Richie

Interpreting the Fed's 'Neutral Bias': Short Big Oil, Buy Defensive Staples

Yasou Markos,

What does it mean to the price of oil when the XOMs and CVXs of the world just cannot produce as much oil as we are consuming? Several times now, the anticipated build just evaporated.

If housing woes spread (and you aren't smart enough to say unequivocally that that cannot happen) isn't it almost certain we will need more funds cuts?

I think the FED wanted to say that in December, if it is a close call, they MAY NOT cut. This was said to keep froth levels in the market down in the event that they don't see a need to cut. ie., They don't want to see a 500+ point down day, so they are giving investors fair warning. But let's face it, this FED (as is true of most), is truly deficient in its projections. They have no more idea of how the economy will look in six weeks than you or I. So any projection they make really has no merit. In fact, if things are strong enough so that a reduction in rates is unnecessary, next month, why go into defensive mode? Emerging economies will continue to prosper and oils and minerals and all commodities will continue to command big prices --- no?