Wednesday, April 27, 2016

Time to stop being bearish on crude oil

We invoke Lord John Maynard Keynes this morning who said long ago when he had changed his mind on an investment he had previous touted that “When the facts change, I change; What then do you do, Sir?” The facts are changing in the world of crude oil; demand is still rather strong and supplies seem to be rising but only modestly. Further, the term structures are shifting. 

We had been, on balance and really quite openly, bearish of crude for the past several years, erring always to sell crude’s rallies rather than to buy crude’s weakness. That has been wrong for the past two months and it is time to acknowledge that “wrongness.” If the facts are indeed changing… and certainly they seem to be… then we too must change. Lord Keynes did; we must also.


via zerohedge

Monday, April 25, 2016

Alcoa has been working well and I like Alcoa

I've liked Alcoa for quite a period of time. Its my own story, I want to own things that if I drop them on my foot will hurt. I'm a simple guy, I've don't understand Hi-Tech, I never understood Big Pharma but I understand 

 I looked at the chart of Alcoa and it looks awfully strong. More and more aluminum is going into airplanes [and] automobiles.

Aluminum is absolutely incumbent in global economic growth and the economy is growing. So I've liked Alcoa for a long time. 



Wednesday, April 20, 2016

OPEC meeting in Doha ended with no agreement due to Iran

The attendees met for five to six hours and apparently the discussion were both fruitful at times and heated at others, but in the end the Saudis made it clear that unless Iran attended the meeting … then there would be no agreement reached. 

Monday, April 18, 2016

Something bullish could be developing in the Metals market



Click here if the video above does not play

I'll be a buyer of Gold despite the bullishness of Silver market. I'm too old to trade Silver, its far too volatile for me. But watch the Silver relative to Gold. In a bull market Silver gains upon Gold. In a bull market the Gold to Silver ratio falls. Its a very good indicator of the precious metals market.

Thursday, April 14, 2016

Panama papers leak could threaten even Government failure


There will be ‘battalions’ of major political and business names that shall ‘come’ to the fore over the course of the next several weeks and months, exposed for having sent money abroad to be ‘washed’ through the legal and banking system in Panama… and it shall not stop at Panama, mark our words. Governments are going to fall, and not just one or two or three, but many and often



via benzinga.com/analyst-ratings/analyst-color/16/04/7802815/dennis-gartman-many-governments-are-going-to-fail-in-wak

Tuesday, April 12, 2016

Happy to see Gold trading higher specially in Euros


Gold broke out to the upside with spot gold trading all the way to $1,240 before running into resistance. 

We are long of gold in non-US dollar terms and we are grateful to see gold trading higher, especially in EUR funded terms.

Monday, April 11, 2016

Foreign countries possibly losing respect for the US Dollar



What we're seeing is a lesser respect for the U.S. dollar, and a greater use of other currencies to buy commodities. This all began because of a loss of confidence in the U.S. to begin with. We are less strong than we used to be, and we're perceived to be weakening. 

We might be seeing more pricing of crude oil in Asia in renminbi terms. We may be seeing greater pricing of grains in Europe in euro terms. We may be seeing a greater pricing of base metals in yen terms in Asia. I think that's really what's happening here.



Wednesday, April 6, 2016

Uber threatening to lower oil prices

I think Uber is a threat to oil for the simple reason that millennials have embraced it very dramatically. The millennials are saying 'I really don't need an automobile.' That whole mystique of driving an automobile is lost and it's not coming back.

If you take a look at the average amount of driving that has taken place in the United States in the previous 60 years, it was a very well-defined trend line. We have broken that trend line dramatically. We are way off that trend. And I think this is something that's going to continue for a long period of time. I think Uber takes cars off the road. And I think that has long term bearish implications for oil and the automobile industry. 



Monday, April 4, 2016

Janet Yellen wants everyone to know she is in charge

Dr Yellen made it abundantly clear to the other members of the FOMC in her comments to the Economics Club of New York, that she is really the one in charge. She'd like to continue keep these relatively lower rates at least for a bit longer. She probably would not want to see the fed funds rate move more than 1 time this year. Others have argued it should rise 3 times as much, that was Dr Fisher. But she put her foot down. No, I'm more concerned about unemployment, employment rates, lack of inflation, problems of deflation, and I'm going to continue to keep the overnight fed funds rates lower than you'd like to be. 

So she just made it abundantly clear shes in charge and she will allow 1 or 2 people to dissent but there will not be any more dissents than that.






QE may well be back upon the table; monetary expansion is indeed upon the table. The dollar, in Yellen's opinion, has been far too strong and has been cast off from the table.