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Freedoms Truth

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  • The Crash In Oil Prices Offers The Opportunity Of A Lifetime - I Beg To Differ [View article]
    I agree. They are explicitly talking down oil now, as if they want to take the bandaid off fast.

    IMHO, its a mistake. They could easily rebalance the market with $70/bbl oil, it will still take out future development.
    Jan 13, 2015. 10:53 PM | 2 Likes Like |Link to Comment
  • The Crash In Oil Prices Offers The Opportunity Of A Lifetime - I Beg To Differ [View article]
    Actually, it DID happen - oil prices cratered in 1985 along the same way it has this past 6 months - Saudis decided they needed a shakeout of the market to regain market share.

    I have yet to see an article analyzing what happened to global growth etc.
    The only comparison I have heard is that it was hard on Texas back then.
    Jan 13, 2015. 10:49 PM | Likes Like |Link to Comment
  • The Crash In Oil Prices Offers The Opportunity Of A Lifetime - I Beg To Differ [View article]
    Oil stayed above $100 even while markets were well-supplied because of that fear. But maybe when it was realised even ISIS sells oil that wars dont matter - the oil will be sold anyway. Libya crude came back and Iraq is increasing production. The point is, geopolitical fears take a backseat when the markets are oversupplied.

    As for: "My contacts state it could be possibly six months before we actually see a significant drop in production."
    That seems to be what most analysts are saying, but we are seeing the news of rig counts down sharply already so while production continues, the trajectory of lower production is starting to get realized.

    I'd like to see some earnings estimates to back up any price estimates.
    Jan 13, 2015. 10:46 PM | 2 Likes Like |Link to Comment
  • Alcoa Reverses Again As Q4 Earnings Near [View article]
    Better to be proven right in your call in the interim than wrong!
    Jan 12, 2015. 05:36 PM | Likes Like |Link to Comment
  • S&P 500 Weekly Earnings Update: 'Ex-Energy' Q4 '14's Expected S&P 500 Earnings Growth Rate Around 7% [View article]
    Thanks for a good article. And I do wonder if the upside in low energy costs will come out in a down-the-road upside surprise for some businesses.
    Jan 12, 2015. 05:33 PM | Likes Like |Link to Comment
  • What The Whisper Number Indicates For Alcoa Earnings Today [View article]
    They beat the whisper bigtime. Good for them.
    Jan 12, 2015. 05:06 PM | 1 Like Like |Link to Comment
  • A Little Fear About The 'Fear Index' [View article]
    "The VIX is near a low point (~12)"
    Wrong. it's at 17.50 as of Friday. Below-average by a bit for markets overall, but on the high side for past 2+ years of our current market. In the past 2 years, volatility above 20 was rare and signalled a short-term correction low. Many bull markets stay a lot calmer for a lot longer.

    The market has been in a different dynamic lately. The obvious culprit has been oil volatility driving market volatility, but more things may be afoot (Europe etc.).
    Jan 11, 2015. 11:04 PM | Likes Like |Link to Comment
  • The Ingredients For An Imminent Bear Market Are In Place [View article]
    "In less than two years, GDP growth expectations have dropped from 3.40% to 2.72%. I would not be surprised to see it drop farther in the coming months due to the crash in oil prices."

    Actually, most knowledgeable analysts say the opposite - low oil prices are good for global growth overall, in China, Japan, Europe and some EM especially ... but US as well benefits on a net basis as the largest oil user. 0.1% growth increase for each $10 drop in oil, so a net 0.5% increase in global growth this year.

    Latest Economist estimate is 2.9% which is up from 2.5% in 2014:

    Many points in this article's analysis is equally suspect / ill-informed. US growth is steady/increasing not decelerating and 2015 growth may be higher than 2014. economist says 3.5% and current data is supporting that pace for right now, if not more. The author says 'grow weakly' but 3.5% would be the best year in this recovery if it happens.

    ... I haven't even read most of this article, as I stop reading after I find 4 things I know are wrong (like the above).
    Jan 11, 2015. 10:53 PM | 1 Like Like |Link to Comment
  • An electric Bolt from GM [View news story]
    "Two companies were suffering the consequences of years of incompetence and inefficiency exacerbated by persistent overcapacity and a deep recession. Normal bankruptcies for the two automakers were viable options, but certain stakeholders didn’t like their prospects under those circumstances."

    That's correct. We didn't bailout the automakers, what we actually bailed out were the auto unions and their pensions, which were at risk in a 'normal' bankruptcy. Taxpayer money was used to payoff the unions and save the pensioners a haircut. Meanwhile, debtors in Chrysler and some others were given a worse deal than if it had been a regular Ch11. Liquidation was never in the cards, but given the credit freeze, one could argue the bailout did save jobs, as they would have cut more and harder without it.
    Jan 11, 2015. 06:49 PM | 1 Like Like |Link to Comment
  • An electric Bolt from GM [View news story]
    I agree 100%. We've done 1,000 mile trips, which you can do in a minivan in a single day, driving 60 mph and taking short stops, takin 10 mins to fill the tank or 30 mins to eat. OK, an 18 hour day but it works for a vacation. Charging stations don't cut it.

    The other 50 weeks of the year are commuting and you don't need the range beyond 200 miles. So any such car is an urban/commuting car.
    Jan 11, 2015. 06:45 PM | 1 Like Like |Link to Comment
  • Oil Deflation Destabilizing The U.S. Economy [View article]
    You could argue that QE has helped the US but it is interesting that we've had the taper, then ended it, and the economic growth has been speeding up.
    Jan 11, 2015. 02:47 PM | Likes Like |Link to Comment
  • Oil Deflation Destabilizing The U.S. Economy [View article]
    Correct. This is a commodity price deflation and not a reduction in the core prices. Note also that dollar strength is a part of this trend.
    We are seeing effects of ECB and Japan easy money:
    1. lower interest rates. (Via carry trade)
    2. Higher dollar.
    ... and 3. Cheaper commodities in dollar terms.

    The article's analysis is wrong. Within a year, we will be seeing a global economy racing forward and worried brows discussing 'overheating'... and oil will creep back up and they'd start worrying about oil inflation again.

    Jan 11, 2015. 02:46 PM | Likes Like |Link to Comment
  • Energy Stocks: The Opportune Time Is When Both A And B Occur [View article]
    That is an interesting point about the strengthening of the dollar. Could the dollar's strength be in part caused by the decreasing dependency of the US on foreign oil? "

    It's a self-reinforcing feedback cycle (Soros had a name for that).

    Fracking has created oil supply-demand changes in US. Less oil imports more domestic production. That means stronger US economy and less imports, helping our trade balances and inflation expectations. That means stronger dollar. The stronger dollar has further weakened oil, which has fed on itself to give us 50% haircut in dollar price of oil. Ruble price of oil hasnt changed as much. Oil is down in Euros and Pounds too, but not 50%.
    Jan 10, 2015. 08:47 PM | Likes Like |Link to Comment
  • Energy Stocks: The Opportune Time Is When Both A And B Occur [View article]
    "Energy investors should keep an eye on these constantly changing moving averages."

    That's all that needs to be pointed out.
    I don't know when and where oil will bottom, but the 'experts' suggest it's in H1 2015 and it looks to be starting the bottoming process now, after going through the 'slump' phase (phase 4) since last year.

    When the crude oil price is above the 50 DMA, it becomes interesting on the long side again.
    Jan 10, 2015. 08:43 PM | Likes Like |Link to Comment
  • Putin Overestimates Russia's Economic Strength [View article]
    Lol. Shell oil was in the Baku in 1910.
    Dec 29, 2014. 07:03 PM | 5 Likes Like |Link to Comment