[MrBill]

Sorry no comments here. Kind of a nothing day. Tried to sell short last night near the close, but instead of getting a surge higher to sell into at the close, it dropped, so my thoughts of where I could get short turned out to be too ambitious. Too bad. It is lower today. Better short with something in the $70-71 range than $68-69.

With copper hitting a high and a 3-4 day long weekend (US/UK) coming up, it is hard to see the market aggressively selling off today, but will stay with the charts, which tell me at the moment to be short on the hourly until proven wrong. Will keep a tight stop loss and likely get chopped around once NY comes in as they test both sides to find the direction of least resistance.

Here is something interesting from the FED:
$this->bbcode_second_pass_quote('', ' ')The study projects a slower pace of workforce growth than most economists now forecast, suggesting the economy can't keep growing at the present-day pace without generating pressure for higher wages and inflation. To prevent that, the Fed will have to enforce a lower speed limit on the economy by pushing up interest rates.

The study suggests that growth over the next 10 years will average less than 3 percent, instead of the 3.3 percent of the last decade, economists said. A 0.3 percentage point difference in growth in the $12 trillion U.S. economy translates into $360 billion over 10 years, equal to the size of Switzerland's economy. Payroll gains, which averaged 200,000 a month in the 1990s, may be half that.

[seahorse]

Mr. Bill,

I have BTU and also ACI (as far as coal stocks). I've also bought some rail stocks, as coal is transported by rail. Our rail capacity is maxed out in the States.

[MrBill]

$this->bbcode_second_pass_quote('seahorse', 'M')r. Bill,

I have BTU and also ACI (as far as coal stocks). I've also bought some rail stocks, as coal is transported by rail. Our rail capacity is maxed out in the States.

[MrBill]

A very strong close the trading week ahead of the Easter weekend. It is very rare that the market does exactly what you would expect it to, and that is close strong ahead of a long weekend, as normally when everyone is expecting the same thing to happen, the market does the opposite. This time it did what it was expected to do. Hmm?
$this->bbcode_second_pass_quote('', 'O')thers watch the price charts, looking at particular patterns for clues on how to play the market on any given day. But these chartists might just as well gaze at the stars to predict the next move, their critics say.

[MrBill]

Ah, the Sudan's & Chad's of the world are catching onto Iran's & Nigeria's game of oil as a weapon in all disputes. Asymetrical warfare. This makes the topside the path of least resistance. The UN, World Bank, & IMF? Totally irrelevant going forward.

$this->bbcode_second_pass_quote('', 'W')ASHINGTON (MarketWatch) -- Chad's oil minister threatened Saturday to shut down a pipeline delivering oil to the international market unless a dispute with the World Bank is settled in the country's favor.
Mahamat Hassan Nasser told the Associated Press that Chad wanted the World Bank to release $125 million in oil royalties held in an escrow account in London.
The World Bank has suspended the payments when Chad used a portion of earlier proceeds for military purposes, which violated a bilateral agreement.
Chad export 160,000 barrels per day.
The government of President Idriss Deby needs weapons to combat rebels who unsuccessfully attacked the capital N'Djamena on Thursday.

[MrBill]

From Market Watch. Some good points, but not all.
$this->bbcode_second_pass_quote('', 'A')RROYO GRANDE, Calif. (MarketWatch) -- Behavioral finance took center stage a few years ago when the Nobel Prize for Economics went to a psychologist. Behavioral finance is the psychology of investment decisions, a science that shows investors are irrational. The award should have killed off Wall Street's myth of the "rational investor."

Unfortunately, investors are still asleep: Most investors don't realize they're in denial. They still assume they're making rational investment decisions. Worse yet, most investors are not only clueless about being irrational, they're clueless about being clueless.

There are three reasons for this ongoing psychology of denial. First, many investors hate being irrational. Their weak egos need the myth of rationality. Second, Wall Street loves having investors trapped in the myth. A clueless investor is easy to manipulate when it comes to fees and commissions. The third reason is that most behavioral-finance books are dull, boring texts filled with jargon and cryptic formulas.

So here's my quickie 10-question behavioral-finance quiz. Maybe it'll help you become a little more aware of how you're trapped in denial, playing an irrational game which is controlled by Wall Street and your friendly fund industry. They write the rules and fix the odds in their favor, like a Vegas casino.

Here we focus on historical realities, avoiding short-term quarterly-report nonsense. Here are 10 facts Wall Street would rather you continue denying. These 10 facts will reveal the intensity of your denial. See how many of the 10 you can accept.

1. Regardless of the facts, you cannot admit failure

What causes failure? "Confronting Reality" co-authors Larry Bossidy, former Honeywell CEO, and management guru Ram Charan say: "The greatest consistent damage to businesses and their owners is the result not of poor management but of the failure, sometimes willful, to confront reality." Same with investors and governments.

2. The market loves making fools of everybody
Ask yourself: Does 2006 look good because the first quarter closed with the best gain since 1999? Or is it a sucker's rally? History's more important than quarterly reports. Looking back six years the market's a loser: the DJIA, Nasdaq and S&P 500 are still below 2000's record highs. In "Stocks for the Long Run" Jeremy Siegel studied history, the biggest up and down days from 1801 to 2000. His conclusion: Markets are random. There's no rationale for 75% of the moves that trigger most long-term gains or losses. Investing is unpredictable.

3. Optimism is the investor's worst nightmare

Morningstar put together some long-term price-to-earnings ratios for us: All nine fund categories and eight sectors, about 10,000 funds. Why focus on P/E ratios? Yale economist Robert Shiller did in "Irrational Exuberance," the psychological profile of 1990s mania. P/E ratios reflect optimism, your worst nightmare. Long-term, P/Es are still high. They've been under 15 most of the last century and peaked at 44.3 in 2000. They spiked over 15 twice before, once in the 1920s before the Great Depression. Again in the 1960s bull, before an 18-year sideways market. Today P/Es are 21.4, below the peak but still deceptively high. Are you overly optimistic?

4. America is like an addict who can't stop
In "American Mania: When More is Not Enough," psychiatrist Peter Whybrow says we're addicts; "more" really is never enough. Our savings rate is below zero so we borrow $67 billion a month to feed our addictive consumerism. We're insatiable, only crashing will stop us. If you're not saving 10%, you're spending too much.

5. Kids will rebel against their out-of-control elders
Kids rioting over labor laws in France; immigration in America. More ahead! In "The Coming Generational Storm," economists Larry Klotnikoff and Scott Burns warn us about the massive debt we're piling on our kids: Social Security, Medicare, government deficits, trade debt, corporate pensions, mortgages, credit cards. Our kids will rebel against the $70 trillion legacy created by today's reckless out-of-control spenders.

6. We're selling our power to Asia and the world
Thomas Friedman warns: "The World is Flat." And getting flatter and more competitive as the global playing field levels, according to "Three Billion New Capitalists: The Great Shift of Wealth & Power to The East." Back in his 1997 "Megatrends Asia," John Naisbitt predicted: "the 21st Century belongs to Asia." Our egos still can't accept that we're giving away our power, mortgaging our future, selling key assets, self-sabotaging.

7. Failure to plan for crises guarantees failure
In "Collapse: How Societies Choose to Fail or Succeed," geologist Jared Diamond shows that throughout history surviving cultures are always the ones that focus on long-term planning, well in advance of crises. Failed societies are the ones whose leaders "focus only on issues likely to blow up in a crisis within the next 90 days." Sounds like Wall Street's fixation with quarterly earnings or Washington rebuilding Category 3 hurricane-resistant levees.

8. 'Greed is still very good" ... for Wall Street
Vanguard founder Jack Bogle confronted the toxicity of greed in his "Battle for the Soul of Capitalism." So does Yale Portfolio creator David Swenson in "Unconventional Success." The problem is obvious: Despite all the scandals, Wall Street is sinking deeper into a culture of greed, where investors come second. And unfortunately, Washington and Corporate America back Wall Street, not you.

9. God, oil and skyrocketing debt don't mix
Former Republican strategist Kevin Phillips' new "American Theocracy" examines the rise and fall of great nations. Rome, Britain and others lost power following a convergence of three trends: diminishing resources, ballooning debt and militant religions. The mix creates a blind obsession for world domination, which ultimately self-destructs. Are we in denial, or is he?

10. You can't trust 'them,' they're lying to you
Here's a survival manual once you admit you're clueless and decide to get out of denial. Begin with this assumption: You cannot trust anyone out there, not Wall Street, not Washington, not cable, not ads, nobody. "They" are all trying to control your mind, spinning and lying all day. Skepticism wins. To survive, make "you" No. 1. Seth Godin's "All Marketers Are Liars" has a powerful yet inspiring message about focusing energies. It will change the way you think about reality, and the way you invest.
What's your score? Anything less than eight and you're definitely clueless, trapped in denial, clueless about being clueless ... and easily manipulated by Wall Street.

If you do see what's going on, then you can choose to either get out of denial and use the new concepts of behavioral finance to your advantage or continue letting Wall Street spin your cluelessness against you.

[shakespear1]

Looks like this card will be played a lot in the future for all kind of reasons.

[mefistofeles]

I've been watching the Nymex prices for weeks and this sudden jump form $61 to $70 is frightening. I wonder if this is truly the moment that the world understands what peak oil is. Here are some frightening facts that support current and future price increases:

1. Militants plan more attacks in Nigeria
2. IEA increased its consumption projections
3. GLOBAL OIL and OPEC output is down versus last month.
4. Russian output growth will be pathetic that .
5. Iran continues to expand its nuclear program
6. Iraq continues its metamorphisis into "Arabslavia"

I look at the Nymex in order to see how my funds are doing for my clients. The expanded session data is pretty scary too we're in contango until the start of 2009. Although I don't believe the price of oil will go up forever if you run a two or three year graph of NYMEX prices there is a definite upward slope. From the point view of buying funds no matter how "high" the price oil may have appeared these last few years it was always better to buy than hold off.

I guess for those of us who work in the investment community its time to something that may be considered both dangerous but prudent in the light of the current market: invest our clients heavily in energy.

We are riding a tiger and if lose our nerve and get off it will surely devour us.

[MrBill]

$this->bbcode_second_pass_quote('mefistofeles', 'I')'ve been watching the Nymex prices for weeks and this sudden jump form $61 to $70 is frightening. I wonder if this is truly the moment that the world understands what peak oil is. Here are some frightening facts that support current and future price increases:

1. Militants plan more attacks in Nigeria
2. IEA increased its consumption projections
3. GLOBAL OIL and OPEC output is down versus last month.
4. Russian output growth will be pathetic that .
5. Iran continues to expand its nuclear program
6. Iraq continues its metamorphisis into "Arabslavia"

I look at the Nymex in order to see how my funds are doing for my clients. The expanded session data is pretty scary too we're in contango until the start of 2009. Although I don't believe the price of oil will go up forever if you run a two or three year graph of NYMEX prices there is a definite upward slope. From the point view of buying funds no matter how "high" the price oil may have appeared these last few years it was always better to buy than hold off.

I guess for those of us who work in the investment community its time to something that may be considered both dangerous but prudent in the light of the current market: invest our clients heavily in energy.

We are riding a tiger and if lose our nerve and get off it will surely devour us.

[smiley]

As you said the oil market isn't as emotional as the gold market due to the fact that one cannot store a tanker in ones basement. If you look at the fundamentals there is reason for high prices. The oil glut that is so often portrayed in the media does not exist. Oil production has not moved in the past 2 years.

That said there is a certain risk premium to the price, which is fueled by speculators. But even that risk premium seems to be fully justifiable. The oil market is in no shape to handle a large disruption. So as long as the US keeps locking horns with Iran and Venezuela, that risk and thus the premium will be there.

Barring any spectacular events, I don't think we see a large correction, a correction to $62 perhaps, but $53-60 seems wishful thinking to me. Past years I heard a lot of traders venomously predicting an imminent and sharp correction of $15 and more. They lost a lot of money as their turbo's bit them in the nose.

Besides, the market has a knack of doing the exact opposite of what the majority of people seem to think

[cube]

$this->bbcode_second_pass_quote('smiley', 'P')ast years I heard a lot of traders venomously predicting an imminent and sharp correction of $15 and more. They lost a lot of money as their turbo's bit them in the nose.

[highfructose]

Oil could easily correct back to its trendline at around 60-62 without anything major happening.

Since I just got back in after oil was able to clear 70 let's not have any shaking out of weak hands until about 78, okay?

[gt1370a]

$this->bbcode_second_pass_quote('MrBill', 'm')ay seem impossible right now, but who would have predicted the correction lower that we saw post-Katerina when there were real supply interuptions versus now where the supply interuptions are mostly upstream and not affecting storage numbers in the consuming regions?

[Doly]

$this->bbcode_second_pass_quote('gt1370a', 'A')nyway, I have read that one trader, I think it was somebody from Fimat or one of those oft-quoted groups, said that after the next major supply disruption he expects a huge price drop due to coordinated conservation measures globally.

[Marklar]

doesnt have to be all that long if you think about it. speculators have pushed it up over $10 in one month on the chance that oil supplies might drop due to Iran halting exports. When its apparent that there is no imminent threat to supplies and/or a massive conservation effort is underway it would be the bears turn to take the hotseat

[cube]

*blink blink*

Was that a "spinning top" I just saw combined with an RSI = 75?

I'm looking forward to tomorrow friday. Hopefully my "suspicions" will be confirmed.

*takes a sip of some <b>strong</b> coffee* I don't know about you guys but I don't plan on getting much sleep tonight if you know what I mean.

[kochevnik]

$this->bbcode_second_pass_quote('MrBill', '
')My feeling here is that we may see $57-63 in the front month on a nasty correction if the world does not blow-up on schedule? Time to shake some weak longs out of the market. Maximum pain for limited gain. It may seem impossible right now, but who would have predicted the correction lower that we saw post-Katerina when there were real supply interuptions versus now where the supply interuptions are mostly upstream and not affecting storage numbers in the consuming regions?

[joewp]

$this->bbcode_second_pass_quote('kochevnik', '
')IMO, absent bird flu, a total capitulation by Iran, we will never see sub $60 oil EVER again.

[mefistofeles]

$this->bbcode_second_pass_quote('', 'I') quite agree. Another thing that tells me there's a supply problem is that the buyers lately are seeming to wait until after lunch to come into the market. They seem to be hoping for a big morning sell-off so they can get a bargain, but it never is enough and they run the price up.

Anyone who shorts this market is crazy.

[Concerned]

$this->bbcode_second_pass_quote('mefistofeles', '
')I don't mean to be rude Mr. Bill but I think it is time to shake people out of this market but its not going to be the longs. Its difficult to see a correction until we have some price stability for at least a week.