Phil Flynn: The Recession Is Over!

The recession is over! Now don’t you feel better? Well at least for a day the stock market sure did and oil and the products decided to go along for the ride as the market once again found a reason to believe. Still it appears that the joy that we are seeing in the market place is not all about the fact that the recession is over but a growing belief in the market place that the Federal Reserve is going to lay the ground work at todays FOMC meeting for another round of quantitative easing.

Oh sure, the expectations are not high that the Fed will do anything today but based on market action, if they do not drop any quantitative ease hints, the market will be a bit disappointed. Still the markets that seemed to be showing the most anticipation of Fed action such as gold and treasury bonds, seem to be a bit toppy after their recent spine tingling surge as they seem to be either getting ready to sell the fact after buying the rumor or perhaps they feel that the Fed may just disappoint them.

The oil market also has to look to the Fed as it is the Fed that is keeping the market from collapsing. While the petroleum market may see a big drop in supply this week due to transitory issues such as the Enbridge pipeline outage and the double trisect of tropical storms and hurricanes the truth is that we have more than ample supply. That is being reflected in an increasingly bearish outlook by crude option players. Oil may start to worry more about geo-political issues as we move forward.....Read the entire article.

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