yeah, and with GS downgrade of GM at 50 year lows? the stock saying that BK is in it's future?
you should read bonner's take on the upward spiral in the price of crude:
Message 24706866
What's going on? Well, what the Saudis give - in proposed, future increased production...the Nigerians take away - with ongoing oil patch carnage that forces the likes of Shell and Chevron to close vast pipeline systems. Apparently the present trumps the future, even in the futures markets. Everything is connected to everything else, isn't it?
"Here is my take on the exit polls from the Saudi Summit...
"Consumers and their representative governments are desperate for an oil pullback. This $135 oil is draining budgets. The poor and working poor are already marginalised in this cruel world of ours. Now it's the turn of the middle classes to get kicked into the cellar of the modern age. People are working time-and-a-half just to put food on the table and gas in the car. Retirees and others on more-or-less 'fixed' incomes are impoverishing slowly. Unless they are impoverishing fast. Bankruptcy filings among the older and elderly demographics in the U.S. are soaring. The bottom line is that the conventional image of a 'decent standard of living' is rapidly receding for many tens of millions of households. The 20th Century is truly over. (I think this has much to do with the meteoric rise of Senator Obama as well... He offers nothing new - mostly just classic, populist Democratic Party bromides - but he offers it in such a sweet and beguiling, Teflon- coated manner...)
"And it will get worse before it gets better. To be perfectly blunt, it might not even get better. Over the next year, and into the foreseeable future, in the developed world people will go broke buying motor-fuel, heating oil and natural gas. (Wait until next winter... Sweet Jeeeezus!) In the less-developed world, people will go broke buying bread. And then the poorest amongst us will starve. Any way you look at it, it's bad for business.
"Fast-rising energy prices are decapitalizing entire nations. Energy prices are destroying wealth faster than people can re-create it. Entire segments of the world economy have hit the iceberg and are filling with cold seawater. Some industries are becoming obsolete in a matter of months. Much of the airline industry is drowning in red ink before our eyes - almost every flight in the sky is losing money, no matter how much they charge to check your suitcase or how few peanuts they put in the small package.
"And down on the ground, most motor transport is just plain uneconomic any more... 'Dead Rigs Driving.' Farewell to the 'Warehouse on Wheels.' Sic Semper Globalisation.
"Large swaths of the auto & truck building industry have become capital-wastelands. For example, GM is closing SUV factories and planning to ditch the Hummer brand. This cascades down to firms that make everything that goes into a set of gas-guzzling wheels. You name it: hot-coiled strip, axles & tires, wire bundles, paints & coatings, window glass and seatbelts, and so much more. Billions of dollars worth of past investment is just gone...bye-bye, poof! And the good-jobs-at- good-wages? History.
"So, is there room for optimism here? Yes, in the sense that high prices are concentrating many minds on energy. 'Energy' is the most important issue of our time, bar none. That is, people are finally beginning to understand the centrality of energy to our collective existence. Take away the cheap energy, and it becomes clear that mankind has spent the past century building the wrong kind of world.
"Another way of saying it is that we've collectively built 'tomorrow's ruins' today. And I don't mean just the physical structures, the bad architecture and stranded infrastructure that is worthless when energy is expensive. Think as well about the social structures that are beyond worthless when energy gets expensive. Tell me when you start to get worried...
"Much of what happens in our time only happens because energy is relatively cheap and abundant. So when energy gets expensive, a lot of what happens is going to stop happening.
"I leave the rest to your imagination." |
