Monday 7 March 2016

Oil hit s $40 - rally monkey arrives

We all know markets go up and down.

Commodity markets too are overdue a bit of a rally given the run of disasters since the middle of last year.

But now there are some interesting changes, with oil back to $40 and looking set for a few more days of gains, a lot of the pressure is easing on the markets which as we know have been very dicey.

Interestingly too, with less pressure on oil prices, some of the sovereign issues will ease a little which in turn means they will stop liquidating all their market positions; lending more stability to the markets overall.

Of course, the real economy has clearly slowed down a touch in the last few months, but where are the indicators showing a big plunge?

All this puzzles me, if economics was good at prediction (which it isn't), low commodity prices should be a good thing. But in 2015, they are apparently a bad thing.

The world remains an inexplicable place.


dearieme said...

If it weren't inexplicable we wouldn't need markets.

Nick Drew said...

a perfect observation dearieme

I have tried for years to make people recognise that the forward markets are by definition a useless predictor of out-turn prices

because if they were a good predictor ...

Albert Bullwinkle said...

You only have to go past a BP petrol station to know if the price of petrol and Diesel has gone up in price and then go past as Shell station to confirm the price rise, Asda prices have gone up from 97'7p to 98.9p since last Thursday, I can only go on what I pay for fuel, markets smarkets mean nothing, paying more does,

Ravenscar said...

Oh dear, where to start????

Lets throw in a few random thoughts, shall we...........................

What one trader can do in an instant, a finger, one little pinkie...... taps a key. Up squillions one moment, down squillions the next.......................

The markets are rigged but then, we are stuck fast in this customs union, where the big cartels dictate, AND we ever so meekly obey and there ain't nuffin we can do.

The bankers have been taking the piss for years, as too, does our Chancellor and political elite.

Funny to record, that, falling spot prices and the price of gasoline (mainly tax) it takes a long time for price drops to come about but boy when oil prices rise - at the flick of a computer key - forecourt petrol prices jump to the tune - 'tis a miracle of modern technology! innit?

We are stuck in the European straitjacket, whereas look over in the states - where cars are half the price we pay and oh looky thar - gasoline prices are the equivalent of 70p/litre!

The other problem, because much of British manufacturing and industry shut, off-shored - went to China - falling commodity prices don't much affect us. With Chinese manufacturing going under and in and with competition from Bangladesh and India - clothes etc stay low, low, low and inflation here, does the same, floating pound too of course. And where the fundamentals of the UK economy are dire, it, the £ will continue lolling in the trough.

The supermarket cartels are still robbing us blind, though they feel a certain frisson of fear from those German discount-ees. But if you've not noticed the size of packets have all gone down, then you truly are a mug.

That's what all of EUrope and the rest of the world sees and notes well, that, Britain its consumers are mugs and will pay any price, and though they are abominably over taxed, they really are: just stupid people - who'll vote for more EUrope and more slavery.

FFS. We need to get a life, be free - saying fuck off to the EU would be a start.

CityUnslicker said...

nice rant ravenscar, not without merit.

Jan said...

According to BBC Breakfast petrol/diesel price is approx 75% tax and George has his eye on raising it a bit more.

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