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Could the High Yield and Oil Collapse Mean a Bubble?


RV_

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According to statistics and damn statistics the average longest bull market has been typically 10 years and we are 6.5 into ours.

 

While many here have posted negatives, and that the market is about to turn, few have gotten my attention as has the fact of the oil price and other commodity drops. I don't claim any expertise and certainly don't have the crystal ball, so I leave speculation to the speculators.

 

However here is a very good short article that rings true to me. Won't have any effect on my holding Tesla. I agree with the bottom line, which is to stay well diversified, but stay.

 

Excerpt:

 

"The rather obvious question after looking at that chart becomes: “Is this the peak?”

 

FINDING THE TOP

Bull markets typically last 6-10 years (Source: Forbes). We’re 6.5 years into ours. Much of the big win has always been in the last ecstatic rise, so we don’t want to get out too early. How can we predict the top of this one?

 

Clearly we can’t put an exact date on the top. But, using some history and some brain power, there’s a lot we can say to get us closer to a crystal ball than “in the next 3 years” because of “no one knows.”

 

The rest of the article with some interesting charts and comments is here: http://ophirgottlieb.tumblr.com/post/135523578139/could-the-high-yield-and-oil-collapse-mean-a

 

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Some Middle Eastern oil producers have very low-costs of production and the U S producers are simply unable to drive their costs to compete so all those bumper-stickers encouraging N. Dakota drillers to........."Drill Baby Drill" ........has a really ugly "downside".

 

I have friends that Gambled and have...........lost HUGE.......

 

Drive on..........(Cheep oil can be a blood-bath for some.....)

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Dolly,

Did you reads the article? I'm posting about the current Bull Market and oil is but one indicator that along with several other commodities must fail together, for the bull market to end, according to his extrapolation of the previous indicators prior to the previous "corrections" and swings to a bear market. He makes a good case.

 

Besides copper and other commodities are dropping, it isn't just oil, and the lowest common denominator pat answers do not cover it. I do not believe most folks are actually aware of who produces the most oil and other gases and liquids. It's not the Saudis. Russia is neck and neck with them in production. https://en.wikipedia.org/wiki/List_of_countries_by_oil_production

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Companies producing oil in the US are now able to legally export the crude. Watch the price rise here at home.

 

Why? It's a global market. Saudi's cost of production is minuscule and they can keep lowering the price to make up for transportation costs and maintain market share. If US Producers want to sell into that market, the US producers must be price competitive. Conversely, why would refiners pay US producers more than word market price? So why would prices rise here at home?

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For the same reason it spiked in 2008 when the Hedge funds used a loophole to allow them to invest in commodities. They were exposed for manipulating the markets by the California delegation to the senate and the price dropped within a few weeks. Since, they have made billions. As the article points out, our production exceeds Saudi counting all the gas and other liquids.

 

This is not ignorant conspiracy theory for this example. We are producing a lot of gas. The natural kind, er, I mean underground gas. I live over the biggest shale gas producing underground reservoir. We export it. I still see fuel surcharges on my bills. They have not gone down one penny from what they were before the local shale field was tapped under the Bossier Parish area where we live. When I ask the answer is that they don't produce more because the price is too low. But they can sell it offshore?

 

Let me be clear. The oil and gas under our country are my and yours, and all our people's resources. They pay royalties to drill and I even get a check from them. They also are contaminating our groundwater and allowing gas to flow into wells resulting in flammable water from our spigots. Here is a 26 second video from here in my home area that was reported on our local news. This is real. And since we get no real compensation for leases, not even a break on our natural gas prices here where it is produced a great cost to our safety and clean water, it isn't conspiracy or some made up video. It is likely too late here. I am moving to the Denver area at some point in the near future once we are no longer needed here. 12 seconds here: http://www.bing.com/videos/search?q=pic+of+gas+coming+from+sink+and+lit&view=detail&&mid=AA39032CBD735AF24564AA39032CBD735AF24564&rvsmid=1609D32AF6BF9A0949201609D32AF6BF9A094920&fsscr=0

 

The answer Duff is that the price is controlled/manipulated with loopholes in the laws the Hunt brothers caused to be enacted after they tried to do what the hedge funds are doing now. For those who don't know their history, look it up.

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Dolly,

Did you reads the article? I'm posting about the current Bull Market and oil is but one indicator that along with several other commodities must fail together, for the bull market to end, according to his extrapolation of the previous indicators prior to the previous "corrections" and swings to a bear market. He makes a good case.

 

Besides copper and other commodities are dropping, it isn't just oil, and the lowest common denominator pat answers do not cover it. I do not believe most folks are actually aware of who produces the most oil and other gases and liquids. It's not the Saudis. Russia is neck and neck with them in production. https://en.wikipedia.org/wiki/List_of_countries_by_oil_production

 

RV........MERRY CHRISTMAS.......

 

Dolly,

Did you reads the article? Yes RV, I did read the article.........and I just commented about some folks that have "many Mineral-based commodities business's" that are indeed in distress presently. Indeed some of these "small business owners" have several hundred million or more in "minerals" .......However.......just like the rest of us "little-folks" they try to stay "diversified" with a few wheat and cattle ranches and maybe a brewery and a couple of shipping companies as well..........just like us.......

 

My point is that a few folks that have "skin-in-the-mineral-game" seem to be feeling pain right now.........some will likely need to sell that Gulfstream jet that was so easy to buy just some time ago........such is the game when you have your skin at risk.......

 

Regarding the Bull market........whew that's a few notches above my pay-grade to pin down...........

 

Once again RV MERRY CHRISTMAS.

 

Drive on..........(Don't hit the Bulls or the Bears too hard......)

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Good answer, me either. But I've been a recipient of the benefits of this market and have disagreed with the many posts about the sky falling. I'm not changing my tune either, just posting for balance an exceptional and concise analysis I found thought provoking. It won't have much effect on my stock, as it was born in 2008 during the crash, and sold out the first two years production. I believe more of the same is yet to come. As you said.

 

I do believe that after this is done and the oil demand recedes, we need to revisit the market cornering laws and get the banks and hedge funds restricted for obvious reasons.

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