Value Buy
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Post by Value Buy on Jan 1, 2019 15:47:23 GMT -5
MAGA. I am having a great time. Gas prices are down. falling energy prices are an indicator of economic weakness. So two years ago when they fell as hard and fast as they did this fall what was the excuse? It sure as heck was not economic weakness. Production numbers are way up. America is no longer facing price spikes at Opec's desire anymore. We are consuming more natural gas in America than ever before because on NG eletrical production and the price of natural gas is still cheaper than a decade ago. Same damn reason. More production. Also, check out the variance between Brent crude and WTI. It is in the $8 premium per barrel range. Historic pricing is closer to $5 or $6 range. The money market centers are more worried about European and Asian slowdown than here and Brent is higher priced. Why? By your statement Brent should be cheap.
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djAdvocate
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Post by djAdvocate on Jan 1, 2019 16:01:07 GMT -5
falling energy prices are an indicator of economic weakness. So two years ago when they fell as hard and fast as they did this fall what was the excuse? It sure as heck was not economic weakness. don't take my word for it. read this: Roberts attempted to illustrate in the chart below, sharp declines in energy prices have actually “been coincident with lower economic growth rates,” as he termed it. In other words, falling oil prices have typically been a harbinger of difficult economic times to come. i should point out, however, that since oil is a global commodity, i was referring to GLOBAL economic growth. there may be some winners and losers in this (ie- Macedonia is doing great these days), but OVERALL, it is a harbinger of lower economic growth. and YES, that was the case two years ago, and is still the case. one more thing: falling oil is really bad for me, in terms of investment. that is why i watch it so carefully and know a lot about how it impacts markets.
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djAdvocate
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Post by djAdvocate on Jan 1, 2019 16:03:44 GMT -5
Production numbers are way up. overproduction is a serious problem for commodity prices. i have a heavy investment in Uranium. the fact that U308 has been selling for under $30/lb for a LONG time now drains investment from the area, and causes mines to shutter. eventually, this will cause prices to spike, because when demand picks up, supply won't be able to match it. the same is true for oil. consumers celebrate stuff like this, but ultimately, it comes back to bite them in the ass.
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Value Buy
Senior Associate
Joined: Dec 20, 2010 17:57:07 GMT -5
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Today's Mood: Getting better by the day!
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Post by Value Buy on Jan 1, 2019 16:07:16 GMT -5
Production numbers are way up. overproduction is a serious problem for commodity prices. i have a heavy investment in Uranium. the fact that U308 has been selling for under $30/lb for a LONG time now drains investment from the area, and causes mines to shutter. eventually, this will cause prices to spike, because when demand picks up, supply won't be able to match it. the same is true for oil. consumers celebrate stuff like this, but ultimately, it comes back to bite them in the ass.
And yet my observation of over production of oil does not beat your observation of a slowdown which may or may not be happening. Please explain brent versus wti crude prices for me and why brent is so high if we are facing an economic slowdown.
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djAdvocate
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Post by djAdvocate on Jan 1, 2019 16:11:14 GMT -5
overproduction is a serious problem for commodity prices. i have a heavy investment in Uranium. the fact that U308 has been selling for under $30/lb for a LONG time now drains investment from the area, and causes mines to shutter. eventually, this will cause prices to spike, because when demand picks up, supply won't be able to match it. the same is true for oil. consumers celebrate stuff like this, but ultimately, it comes back to bite them in the ass.
And yet my observation of over production of oil does not beat your observation of a slowdown which may or may not be happening. Please explain brent versus wti crude prices for me and why brent is so high if we are facing an economic slowdown. 1) i never said that it "is happening". 2) i am not following your second question. just because it is cloudy does not mean it is CERTAIN to rain. but it is certainly not cause for celebration, if rain is going to ruin your wedding.
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djAdvocate
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Post by djAdvocate on Jan 1, 2019 16:19:39 GMT -5
VB: i think i get your question, now. you might be able to ascertain WHY this is happening by looking at this chart: my understanding is that WTI includes everything shown on the right side of this chart. if so, then the recent activity in the Bakkan is driving UP quality, which further differentiates it from Brent (driving up the premium). thanks for pointing this out. i had not noticed the effect, because i don't follow WTI.
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countrygirl2
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Post by countrygirl2 on Jan 1, 2019 19:28:59 GMT -5
I don't know, guessing soybeans. I don't hear much news on the farmer front. We are in the middle of farm country but no one really talks about any of it to us lay people, so I don't know whats happening.
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