Thursday, October 7, 2010

Phil Flynn: It’s A Barrel Buster!

Crude oil rises after a barrel busting report. US total petroleum supplies hit the highest level in 29 years. Crude stocks are the highest since 1980. Gasoline supplies, the highest levels since 1990. The forward demand covers for supply, the highest since 1995. Demand for petroleum products dropped a whopping 6.4% and prices rise! So I guess this quantitative easing thing is a way to help oil companies and their bottom line. The Fed wants inflation and the Fed gets what it wants and is even thinking about going beyond their informal target rate. The Fed fear deflation and believe that the best weapon against it is inflation real or not.

The Wall Street Journal says that, “the rationale is that getting inflation up even temporarily would push "real" interest rates nominal rates minus inflation down, encouraging consumers and businesses to save less and to spend or invest more” Let’s see how that works for you. At the same time the US and China are getting testy about the currency rate as the Chinese are saying that forcing them to revalue or devalue their currency would lead to a disaster for the world. The set up is so bullish and commodities continue to......Read the entire article.

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Anonymous said...

crude oil dropped from over 84$ to 82.5$ in last european session and your posting this bullshit,since when overprised petrol and low dollar is good for economy ?

Ray @ The Crude Oil Trader said...

High oil prices are great for the economy....the economy of those who are long oil of course.

Thanks for your comments "Anonymous", we see your posting's all over the internet. Great to finally see you here. ;-]