If Oil Gets Smacked Down, Equities Will Run

Quote from empee:

i disagree, when oil breaks the market will also sell off. All the earnings growth is by the oil companies and no one is positioned for this.
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Finally someone who gets it. I am amazed that some people have reached the opposite conclusion, and say it is obvious, when the real conclusion is the opposite of what they concluded. Dollar up, equities down, and commodities down. It may seem strange, but I already explained why in two other posts and in one thread.

Why: read the analysis at this link:

http://www.elitetrader.com/vb/showthread.php?s=&threadid=127543&perpage=6&pagenumber=28
 
Quote from stock_trad3r:

lol oil is not going to collapse and the dollar will continue to fall. Paulson, Ben, and Bush aren't worried about the falling dollar because it is actually beneficial to the US economy.
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"is actually beneficial to the US economy"....can now be read as "WAS actually beneficial to the US economy"

This factor will become more obvious to everyone in late summer/cum fall and therafter.

In the meantime, you had better hope that there is a change in policy,regardless who makes it, that provides a genuine support of the US dollar...
 
Maybe the US could see deflation. That means price of everything on average goes down.

House price down.
Interest on loan down.
Computer price down (8 core CPUs for the price of 1 core)?
LCD price down (two for the price of 1?)
Cell phone price down (unlimited everything for $50? 4 year contracts?)

In a recession consumers have less money. To convince them to buy, producers need to lower prices and try to sell more quantity.

Oil price can go to $200 but who cares. I will just drive (A) slower and (B) less miles.

PS everyone is talking about oil price... It is so bubblicious.
 
Quote from stock_trad3r:

lol oil is not going to collapse and the dollar will continue to fall. Paulson, Ben, and Bush aren't worried about the falling dollar because it is actually beneficial to the US economy.
More...


I do recall you stated in a post sometime again how you think people are morons who are talking about betting on how the market / commodies will do, and mention it's a fools game.

You sure do a lot of speculating.
 
Quote from dividend:

Maybe the US could see deflation. That means price of everything on average goes down.

House price down.
Interest on loan down.
Computer price down (8 core CPUs for the price of 1 core)?
LCD price down (two for the price of 1?)
Cell phone price down (unlimited everything for $50? 4 year contracts?)

In a recession consumers have less money. To convince them to buy, producers need to lower prices and try to sell more quantity.

Oil price can go to $200 but who cares. I will just drive (A) slower and (B) less miles.

PS everyone is talking about oil price... It is so bubblicious.
More...

The problem, as I see it, is that people buy computers, furniture, automobiles and, especially, houses, every several years or longer.

But gasoline, heating oil, natural gas, flour, vegetables, beef, rice, chicken, consumer staples, and everything else that has surged recently, they buy everyday.
 
Oil is a story that will never go away, not from this point forward. Statistical analysis of past wars will show you the correlation between international conflict and the price of commodities. Years from now, God nows how far from now, when we leave Iraq and Afghanistan, theoretically the price of oil should come down a bit, BUT by this time the international oil demand story will be stronger than today, and the supply will be smaller. So, near term (at least 3 years) we can count on war bouying the price of oil. When the conflicts start to wrap up, the price will remain elevated due to a dwindling in supply coupled with the ever rising demand by "turd" world countries that don't care about powering their cars with cellulose based fuels. The writing's on the wall, look at OPEC's actions over the past couple of years. They're not raising output, because they want oil to last until 2025, not 2015. Farewell.
 
1. Oil is in a bubble...Demand for oil has always existed, and what has occured from 2003 is ridiculous. It's speculation.

2. If the American government was not controlled by interest groups, dependence on crude oil would be significantly less. Congress talks about making other sources of energy more efficient, but does little in reality. The people in power are just waiting for oil corporations, like Exxon Mobil, to be the ones to develop more efficiently run natural gas and so forth, so the profits go to them. We could easily reduce our dependence on oil if Congress better funded independent institutions, rather than waiting for corporations to do the research. Why waste money on unjustified wars? If you want to increase the national debt, the least Congress can do it spend the money at home.
 
Quote from empee:

i disagree, when oil breaks the market will also sell off. All the earnings growth is by the oil companies and no one is positioned for this.
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Oil has an inverse relationship to the market (sp500) above 110ish level. When oil drops, sp500 moves up, and vice versa. How the hell do you guys not see that in the intraday chart each day.

If oil breaks and moves below 110, then i believe this inverse relationship will be voided. But right now they are linked very closely.
 
Quote from ByLoSellHi:

Those long non-oil stocks (I'm talking direct as possible; I'm not even referring to refiners, which will shoot to the moon if oil falters), should be absolutely cheering for a total break down in crude.

At this point, a shoring up of the USD and a collapse in crude oil prices (brent and WTI) will absolutely open the floodgates to new cash into the equity markets.
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or USD drops, global economy weakens sending oil down some. the result, gold and silver and shine.
 
Quote from newguy05:

Oil has an inverse relationship to the market (sp500) above 110ish level. When oil drops, sp500 moves up, and vice versa. How the hell do you guys not see that in the intraday chart each day.

If oil breaks and moves below 110, then i believe this inverse relationship will be voided. But right now they are linked very closely.
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oil and the market will rise together
 
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