ManAboutDallas

Inflation Premiums at Odds with Crude Price Behavior

Look, it's simple really. Sooner or later, people are going to get tired of paying for a VALUABLE asset - oil - with an increasingly WORTHLESS asset - the US$.

The trip-wire will be when oil reaches $100 / bbl again, and everyone outside the United States in the position of needing to purchase oil looks at one another and goes, "What are we, stupid or something?".

Inflation Premiums at Odds with Crude Price Behavior

You hit it on the nail in your final sentence...
"At $80 in crude and $1200 perhaps the trends in crude and gold were a little too obvious."

.... and what else would one expect but that Mr. Market would reach over and depress the "FLUSH!" handle once more? And now, the bowl refills itself.

Lather. Shave. Rinse. Repeat.

U.S. Treasuries in a Bubble, Not Commodities

It's the last-gasp attempt by the Fed to manage the yield curve and pretend "everything's ok". The inevitable can be forestalled only so long, however. The pin this bubble will find is when either:

1. Gold tops $1344; or
2. Oil reaches $100 again.

At that point the US$ will be carried off in a body bag and it'll be "Weimar, Part Deux" time.

Friday Outlook: Commodities, Global Markets

The rally has one more upside target, using the Dow as proxy. That target is DJIA 10,344 which is the 50% Fibo retracement of the Oct 2007 top to the Mar 2009 bottom.

A nice two-week, 700-point Dow rally into mid-October will get the Chumps nice and buttered for the Toasting-to-Three-Thou...

Last year was just the warm-up act, boys and girls.

The Stealth Commodity Index

If you want an "honest" commodity index, use the old CRB, which is now carried by most quote vendors as CCI ( Continuous Commodity Index ) or some close variant thereof.

The Deficit Rally

They have, finally, so the "How many times" is now "zero". The first US$ applecart to get kicked over was the recent Japanese election. The second US$ applecart to get kicked over was the Chinese telling their SOE's they could say "GFY" to the Western banks over the derivatives contracts. The next US$ applecart to tumble ? My hunch is when the issue of oil priced in US$ gets raised again, which will probably happen the next time oil tops $100, shortly. When those mutterings become a raucous cacophony, that'll be when the US$ starts its final slide to Weimar-style oblivion.


On Sep 10 11:42 AM Earthizen wrote:

> Call it anything but "inadvertent meddling". Better yet, make it
> "intentional"! How many times can we do this to the rest of the world
> before they wise up?!

Crack Shows Up in the Risk Trade

Or, to put it another way:

The SECOND mouse gets the cheese.


On Aug 24 11:30 AM Tony Petroski wrote:

> The guys who find out "how far to go" are those who stumble onto
> the remnants of those who "found out how far to go."
>
> Cheers.

What Does the Dollar Bottom Mean for Stocks and Commodities?

The US$ is absolutely, positively guaranteed to be the biggest loser in the race to the bottom, because as the current reserve currency, it has the MOST to lose, as such.

It's the basic Law Of The Jungle: everybody wants to knock off the King, as soon as the King shows the signs of fatal vulnerability.

And with the US$ being held up by nothing but lies and posturing, the final chapter is already written. And it's not pretty.




On Aug 24 02:43 PM LT Trader wrote:

>. It's a currency devaluation race to the bottom,
> and perhaps the U.S. won't lose.

What Does the Dollar Bottom Mean for Stocks and Commodities?

Might have one last lunge left up to about 10,334 which is the 50% Fibo of the October 2007 all-time top and the March 2009 panic low. If 9422 ( 38.2% Fibo ) gives way, Katy bar the door, that's all she wrote.


On Aug 24 02:06 PM Roger Knights wrote:

> Bingo! It looks like we'll get a one-day reversal today.
>
> "I would say that the biggest predictive statistic is again the supreme
> sense of optimism that currently permeates the markets and business
> media."
>
> The top is in; the cover story of Business Week's special issue last
> Monday was, "The Case for Optimism."

What Does the Dollar Bottom Mean for Stocks and Commodities?

Sorry, nothing more coming for the $ than a butter-the-chumps rally before the Plunge IntoThe Abyss that'll take out the .72 low like a hot knife through butter on the way to .50. If it's luckier than it has any right to be, we'll struggle back to just under .80 which is the .618 Fibo of the June-Aug drop.

The US$ is T - O - A - S - T.

The Dollar Must Decline for the Market to Rise

It will, briefly. Up to about 10,334 which is the 50% Fibo of the October 2007 all-time top and the March 2009 panic low; and also roughly the tipping point of the October 2008 Massacre.

From there, it's going to be non-stop to 2600 Dow as everyone finally realises the game is over for good and the real panic sets in.


On Aug 24 12:02 PM epeon wrote:

> if your thesis is correct, then the stock market is going to take
> off. Because current administration policies will trash the dollar.