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Market Update 10:48am
Posted: July 15, 2008 at 10:49 am by Lisa
Do we bounce from here or fall into the abyss? Wish I knew. That’s why I’m on the sidelines today. Here’s more from Bernanke and Bush:
FED’S BERNANKE: HOUSING MARKET IS THE CENTRAL ISSUE FOR THE US ECONOMY, US BANKING SYSTEM IS WELL CAPITALIZED - Q&A
- Must be careful when changing margin requirements.
- US banks are deleveraging, banks are challenged by current credit conditions.
- Less concerned about solvency than banks’ ability to extend credit.
- IndyMac failure was inevitable, given its bad asset quality.
- Emphasizes the need for a bank-like regulator for the GSEs.PRESIDENT BUSH: REITERATES CALL FOR CONGRESS TO REMOVE BAN ON OFFSHORE DRILLING, MUST ENSURE GSES CAN CONTINUE PROVIDING MORTGAGE CREDIT
- says the GSEs should remain shareholder-owned companies. GSE rescue plan should be part of the housing bill, and FNM and FRE plan is ‘not a bailout’, but provides temporary assistance
- notes US economy shows remarkable resilience, US banking system is basically sound.
- says no immediate fix for energy costs.
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/charts/metals/gold/t24_au_en_usoz_2.gif)
![[Most Recent Exchange Rate from www.kitco.com]](http://www.weblinks247.com/exrate/24hr-jpy-small.gif)
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VIX finally made an appearance over 30 for a while and just now dipped back under but still no capitulation. That said this is definitely not THE bottom. More downside coming….eventually that is.
What is going on with oil….wow
wtf happened to OIL i just nipped out to make a cup of coffee and it down $10
rebs, listen to bloomberg radio now… very interesting
OPEC: EXPECTS DEMAND TO FALL AS ECONOMY SLOWS, CUTTING DEMAND FORECAST, SEES DEMAND FUNDAMENTALS SOFTENING IN 2009
- OPEC says “Market fundamentals have clearly been softening. This trend in fundamentals is expected to continue - and even gather pace - into the coming year.”
- Warns that it sees declining demand for OPEC oil and inventories. Counts slowing economic growth, conservation, NGLs as threats.
- 2009 could see the biggest drop in demand for OPEC oil since 2002. Sees 2009 world oil demand rising by 900K bpd, less than non-OPEC supply of 940K bpd.
- Sees 2009 demand for OPEC oil at 31.2M bpd, down by 710K bpd.
- Cuts 2008 world oil demand growth by 100K bpd m/m.
thanks Lisa
HMMM…Could this be the big break in oil that I have been waiting for??? IF (and that is a big IF) DUG continues to make a strong move up, I might just take my profits and retire from trading for at least the rest of the year. As you know, I have a VERY big bet here and it would be a dream to hit paydirt. I am exhausted after 8 weeks of sweating this out and sticking to the trade. In either case, I think DUG has a lot of support at $30 now. Look at the really nice bottoming pattern on the daily chart.
Are you listening to Bernanke, Opitz? The testimony of Bernanke just has this market chasing it’s tail. Wild.
Good luck Dave! I really hope it pays off for you
Watching DUG along with you.
F*** the word “RESILLIENT” is that a Klingon word meaning “we are f*****”?
Does anyone here think that C or BAC is going out of business? Heck..BAC now has a dividend rate of 13%. At this rate the dividend may be 50% within the next few months.
Someone is going to make a lot of money when these stocks turn, but it probably won’t be me….
Light Sweet crude is in short supply on a world wide basis. This will no change. Prices are going higher. The next shoe to drop will be shortages and product allocations. GASOLINE PRICES will not be an issue within a year. THE ISSUE WILL BE SHORTAGES AND UNCERTAINITY OF AVAILABILITY. THEN THE POOP POOP WILL HIT THE FAN..
The Government bailouts/stimulate plans are puny compared to the massive multi-trillion decline in assets and write-offs that are coming this year. The FED/Treasury are firing blanks.
On any rally, buy skf. On the sell off in oil, buy fti, oii with DUG used as hedge.
Yes, Lisa… Listening for the first time… He sounds quite nervous in his voice…
The numbers OPEC just put out still does not put a dent in the peak oil theory plus the up trend seems to be intact. The level of demand destruction and movement to alternatives does not seem to be enough in the face of ever diminishing supply. But that is more of a long term perspective so we’ll see what happens in the short term. Good luck Dave.
Opitz- Bennie always sounds that way when he’s stretching the truth.
Jim- “Poop Poop”? LOL
Dave- I wouldn’t touch C or BAC with a 10-foot pole. And anything is possible with them, even being sold off or merged or whatever.
Thanks all for the thoughts and advice on DUG.
Just to be clear here…. I completely agree with both Jim and JohnK. I think the long term trend in oil is UP. There is clearly supply issues. Some major oil fields in Mexico are nearly dried up. Until we come up with some meaningful alternative energy, oil has no direction to go in the long run other than up.
My trade in DUG is just that…. a trade. Since I am in at just over $28, I am trying to get 30 or 40% out of this one, then I am out.
Jim - I like your trade setups. Keep posting. You have some good stuff.
P.S. It has nothing to do with my DUG trade, but I used to work on a oil drilling rig in the North Sea for 5 years!!
Ok, Dave, now I’m impressed. Oil rigs? Wow. Tough duty.
Lisa - Yeah..especially in the North Sea. We were drilling off the coast of Aberdeen Scotland on a sem-submersible rig (exploratory drilling). Definitely a rough environment out there (weather). Although I did wear coveralls, hardhat and boots (like everyone out there), I had more of an office job on the rig, so don’t be too impressed. I wasn’t one of the roughnecks, drillers, toolpushers, etc. Mainly warehouse and bookkeeping type stuff back in the early to mid-80’s when I was a young guy.
Working out there was a lot easier than trading this market.
Still impressed.