Click to enlarge.
Click to enlarge.
I created the charts out of curiosity.
What would it take to see $5 gasoline at the pumps? It looks to me like a sustained $160 oil level could do it.
If I had to guess (and I assure you that's pretty much all it is), I'd say the global economy can't even handle $100 oil though. Time will tell.
November 9, 2009
I'm Deflationary
That doesn't mean that I think oil can't make it to $100. Who knows? I don't think it will stay there if it does though, any more than it could stay at $140 the last time.
It's certainly trying to stick at $100. I'll give it that.
Keep in mind that although I have been leaning deflationary, the bulk of my nest egg continues to sit in long-term TIPS and I-Bonds.
This is certainly not investment advice. I think you can see my level of certainty here. I continue to lean short-term deflationary but want the long-term inflation protection just the same.
Source Data:
EIA: Petroleum
At least in the US, $100 crude is too high, as gasoline consumption continues to drop. DOE data shows gasoline consumption has been declining continuously for several years.
ReplyDeleteWhat's strange now is that the US has become a net exporter of gasoline.
"...I have been leaning deflationary, the bulk of my nest egg continues to sit in long-term TIPS and I-Bonds."
ReplyDeleteA few years ago I read a comment to the effect that when things are bad, inflation-protection is given away free. So I decided to buy it, free.
Scott,
ReplyDeleteThis is sure to bring us everlasting prosperity. No doubt about it.
*sarcasm*
dearieme,
ReplyDeleteWe were given one last bonus opportunity in February 2011.
That Jeremy Siegel, what a hoot!
Some might try to tie Jeremy Siegel to the pillar of retail strength that is Sears, but that's not my style, lol. ;)
ReplyDelete