Oil Hits 32-Month High As Unrest Persists in the Middle East

Posted on April 22, 2011 by MN Gordon

Oil prices keep going up. Gas prices too.  We filled up our tank on Wednesday and paid $4.19 per gallon for the cheap stuff.  What gives?

According to the President high oil prices are caused by speculators gaming the oil futures markets…

“It is true that a lot of what’s driving oil prices up right now is not the lack of supply.  There’s enough supply.  There’s enough oil out there for world demand,” said Obama at a reelection campaign event in Annandale, Virginia, on Tuesday.

“The problem is, is that oil is sold on these world markets, and speculators and people make various bets, and they say, ‘you know what, we think that maybe there’s a 20 percent chance that something might happen in the Middle East that might disrupt oil supply.’

“‘So we’re going to bet that oil is going to go up real high.’  And that spikes up prices significantly.”

Perhaps, as the President asserts, speculators are responsible for pushing up oil prices.  But, unlike the President, we don’t consider that to be the problem. Continue reading →

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Something to Believe In

Posted on April 19, 2011 by MN Gordon

Something to Believe In

“Congress is going to have to raise the debt limit,” said Treasury Secretary Timothy Geithner on Sunday’s Meet the Press.

Poor Timothy Geithner.  Aside from the President he must have the worst job in the world.  What could be worse than presiding over the world’s reserve currency at just the moment it blows up?

No doubt, Geithner’s fighting an uphill battle.  His number one product – the U.S. Dollar – has been diluted down like an over breaded meatloaf.  Both its quality and reputation have been compromised by years of moronic fiscal and monetary policy.

On the fiscal side, the government’s run up a $14 trillion debt.  On the monetary side, the Federal Reserve’s artificially suppressed the cost of money and, if you can believe it, they’ve loaned out trillions of dollars they never had to begin with.

Now, after years and years of pushing the tab out into the future, the bill’s due.  In fact, according to Geithner the government will reach its $14.3 trillion debt limit by May 16.  What’s more, the Congressional fight to raise the debt limit may last longer than the money does. Continue reading →

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How to Time the Market

Posted on April 15, 2011 by MN Gordon

Stocks may finally be topping out.  Or, perhaps, they are just consolidating for their next leg up.  How you see it depends on if you are a bull or a bear.  Here’s a look at recent market action…

After trading flat on Monday the DOW dropped 117 points on Tuesday.  Then, on Wednesday, the DOW was practically flat…up just 7 points.  Yesterday, the DOW picked up 14 more.

Do you see how it works? Stocks go down one day.  Then they go up the next.  Stocks go up one day.  Then they go down the next.  Other times stocks go up, before they go up some more.  Except for when stocks go down, after they’ve already gone down.

If you stare at a stock market index chart over time you can see movements that appear to repeat.  Some market technicians call these waves.  And if you stare long enough you can actually see wave patterns.  When you zoom into a wave pattern you can even see wave patterns within wave patterns.  These wave patterns all appear remarkably predictable…down, up…up, down…just before the moment they change.

Do you get what we are talking about?  What we mean is timing the stock market is a fool’s endeavor. Continue reading →

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The Powers of Nature

Posted on April 12, 2011 by MN Gordon

We greeted the news Friday night with the lethargic disappointment that comes with a second helping of cheese cake.  We’d longed for a government shutdown…and to see the army of beltway administrators without a purpose in life come Monday.  Instead we got what President Obama called “the biggest annual spending cut in history.”

We’re not sure what he means by “biggest.”  A quick back of the napkin calculation tells us the $38 billion spending cut amounts to about 1 percent of the estimated $3.8 trillion in total 2011 fiscal year spending.  In other words, it’s a sham.

Former U.S. Comptroller General David Walker recently remarked that the House budget debate over such paltry cuts was “like arguing about the bar tab on the Titanic.”  No doubt, the ship of state has struck an iceberg and is rapidly taking on seawater.  In fact, the entire hull should crack and buckle sometime before May 16th.

That’s when, according to Treasury Secretary Timothy Geithner, the federal government runs out of money for good unless the Congressional debt ceiling is raised.  In a January 6, 2011 letter to Congress, Geithner wrote… Continue reading →

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