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Shorting The Bond Bubble? Hold On
As per AustinESW's comment about EDV, be wary of that EFT's very short history (it was launched only 1 year ago) and very poor liquidity.
Who's Piloting U.S. Treasury Bonds' Flight to Safety?
But the most worrisome point however is this: the US debt is not $11 or $11 trillions. That's the on-balance sheet portion. Over the last few years the government has started to keep new debt off balance sheet, resulting in a real deficit closer to $55 trillion. At least according to David Walker, former U.S. Comptroller General. In the long run, who is going to finance that in exchange for a 2% or 3% return?
Treasuries Topping Out
Have We Reached a Near-Term Bottom?
Interestingly, if you look at Friday volumes for some ETFs, they are all much lower than Thursday. And a short selling ban is a desperate measure that could potentially increase instability, and not reduce it.
Most of all, whatever the plan is, it will do nothing to address falling consumer spending, falling housing prices, and higher unemployment. Banks are not going to rehire those who were laid-off over the past few months and manufacturers are not going to see a surge in demand. Ultimately, in my opinion this is why the market has been falling. The collapse of part of the banking system is only part of the bigger picture
No Happy Endings in the Credit Crisis
The question is: what are the consequences of this huge liquidity injection? Inflation. We are already in a global inflationary environment and this will just make it worse. High inflation + flat salaries + increased unemployment = depression?
No Happy Endings in the Credit Crisis
The question is: what are the consequences of this huge liquidity injection? Inflation. We are already in a global inflationary environment and this will just make it worse. High inflation + flat salaries + increased unemployment = depression?
Everyone Wants the Commodity Bubble To Be Pricked
Do Oil and the Market Still Have a Lot of Downside?
I'm long SPY 2010 puts and planning on adding more as soon as November comes.
Is Natural Gas Down for the Count?
Oil and Gas: Perfect Investment Tsunami
Here're my two cents: if you don't have time to investigate single stocks, don't rry to guess: futures or ETF can do the job pretty well. With declining oil supply, eventually there will be a shift: probably from oil to gas, perhaps from oil to nuclear.
ETF Update: Oil Service ETFs, Natural Gas Plays
Thanks.
I didn't know about it.
On May 15 10:06 AM lminsky wrote:
> I'm starting to hear more about nuclear energy. I see that Invesco
>
> has a new ETF, PKN - a global nuclear energy fund. Any chance you
> could give us a sense of where we are with nuclear and potential
>
> future profit directions?
Oil and Natural Gas Due for a Pullback?
3M average volume on GAZ is about $1.5M vs. UNG $65M.
On May 15 10:40 AM Tomas T wrote:
> Check ticker GAZ, I did very well for the past 2 weeks (10% +), (from
> user 193917)
UNG
Thanks
We're Nearing Crunch Time for Oil
However, I think as the conversation progressed some lost sight of the point the author was making.
In my view, this is not about how large potential oil supplies might be. As all the above comments suggest, people have different, often conflicting opinions. The truth is that we don't really know, not does it matter. What does matter is the perception that the (negative) spread between supply and demand is widening. But even that is not really the point. The issues, I think, are:
1- At what price are we going to see a real shift from traditional to new sources of energy?
2 - Who is going to pay for the research?
3 - How long will the entire process take?
Question 1: At what price? Europe has been paying for decades almost four times what we pay in the US, and still not that much has happened there in terms of a serious changes
Question 2: Who is going to pay? Well, not the oil companies, who would have the resources, but not the interest. Not the auto industry, which might have the interest but not the resources. And not the governments, at least until they are buries under a pile of debt.
Question 3: How long? Your guess is as good as mine.
On one point I think most of the above comments seem to agree: natural gas looks like a good bet.
Not All Commodities Are Created Equal: A Look At Agriculture
Thank you for your comments. You are absolutely correct in pointing out the importance of current stockpile levels. I have gathered the following data: At the end of 1999 the world grain reserves covered 119 days of consumption. Today, we are looking at 50 days for corn and 70 days for wheat. During the period 2000-2005 cereal reserves covered 18 weeks on average. Today we are at 12 weeks, with corn at 8 weeks. The most striking aspect of these numbers is, in my opinion, the velocity at which reserves are contracting despite slightly increase in production.
As far as the relationship between foodstuff prices and commodity prices, it was my intention to point out that the correlation is less intuitive than one may expect due to a variety of factors, such as labor and transportation costs. Thus, commodity prices are not always a satisfactory leading indicator of where Food CPI inflation is headed.