Time to short the oils, folks. The ride up the past three weeks in the oils was nice...but now it may be time to scale into shorts. Got puts?
Got this from a really, really, REALLY, good TA fellow...bet he's better than Slider's pal :)
<<Here in the United States, the message is clear: End dependency on foreign oil or suffer the consequences. This is why last year a group of U.S. lawmakers unleashed a new plan: to finally unveil a secret U.S. government oil field and unlock the oil trapped inside. Last August, the Energy Department delivered the full report: This new reserve holds more than 2 TRILLION barrels of oil… Enough to meet our energy demands for the next 500 years, according to some estimates.
In other words, this reserve is so big it could put a stop to our foreign oil dependency and end oil worries forever. While you almost never hear about it in the mainstream news, plans are already underway to drill this massive oil field. The government is finalizing the details this very moment...
Time is not on our side in the short run when it comes to oil, but two or three years from now once this vast resource has reached 30 to 40% production capacity, the US oil problem will begin to resolve itself. The sheer size of the find in time could put the US back on the oil export market.
Even more good news took pace this week as the House passed a resolution to open deep water drilling in the Gulf of Mexico. We also know these reserves are vast but vulnerable to storms as we saw in 2005. It is clear that in time the oil component of US problems will resolve itself as these two new resources start to come online.
Our problems and those of the Fed come down to managing the economy during this transition period. In my opinion, keeping the US dollar's global status at some point will outweigh the short term needs of the economy. If true, rates will remain high and demand will slow in a short lived period of stagflation. If my assertions are accurate, 2007 will start the next recession in the US, but as the business cycle turns bleak short term, time will be on our side as the new oil resources come online. The longer term view of US expansion will, as it has in the past, once again return us to a period of prosperity.>> |
