The price of WTI index crude has fallen back below $50 again as inventories rise far more than expected. That has been the theme of late despite the recent retracement in crude. However, looking at WTI via the futures curve, trading habits are increasingly locking in the outer years (especially past 2016) around $65 - $70 per barrel. That is [...]
After months of hearing about how the fracking “miracle” is totally, fully and comprehensively responsible for the drop in oil prices there is finally penetrating reality. After the continued disruption in the Chinese economy as well as the close onset of recession in Europe, plus full-blown recession in Japan and Brazil, all that is left is really the diminutive hope [...]
Given the attention to oil prices lately, it sure seems as if the media is determined to make a case for supply causation rather than anything of demand that might harm the established recovery narrative. In almost every major financial outlet, and more than a few “mainstream” “news” centers, there is a uniform tale of how lower oil prices are [...]
The surge in Japanese GDP in the first quarter has given back some cautious optimism that eroded significantly in the fourth quarter of last year. The increase in activity was not unexpected, only the degree to which it reached. Given the household spending data from earlier, this result was foreshadowed. And I think that the analysis of spending applies equally [...]
Apropos of the GDP outlier, Jason Fraser of Ceredex Value Advisors forwarded an article from CNBC, of all places, on the impact of this inventory cycling on US trade. Specifically, container traffic in imports has turned lower in November when it normally would do otherwise – and had for the three previous years. Traffic had been slightly below 2012 levels [...]
Holiday sales estimates are already being trimmed, with the current year set to be the weakest since the Great Recession. Of course, it matters whether or not you have access to asset inflation, as retailers for the more affluent are expecting better results. Reuters spells it out succinctly, “As result, low-income Americans will again have a less-merry season than affluent [...]
If ever there was a case of “recession fatigue” it was Europe in the summer of 2013. There has been nothing but optimism from the Continent throughout, and sunshine purportedly reflected a burgeoning recovery that was far more broadly situated than the vagaries of Germany’s export economy. Spain and Italy were to be among those that could proudly proclaim, as [...]
Global trade is one of the primary “headwinds” facing the global economy, and it does contribute to the lack of dollar flow impeding exchange functions in troubled currency areas. A large part of the “solution” proffered by central banks is an appeal to currency devaluation in order to boost export activity. The primary impediment, something that flies in the face [...]
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