September 20, 2009 5:30 PM MDT
You will soon be paying under $2 per gallon again for gasoline and diesel fuel and crude oil will go back down into the 40's. So you can make plans for that trip to see the grandparents for the holidays as well as give the economy a much needed boost. Demand for gasoline in the United States typically falls after Labor Day due to vacation season ending. For the week ending September 4, 2009 demand for gasoline was at its lowest point since January 9, 2008 according to MasterCard Advisors LLC.
Inversion of diesel fuel versus gasoline prices has not been the case in the United States since the Rita and Katrina hurricanes hit the Gulf Coast in August 2005. That event had a major long term impact on inventories of gasoline, distillates and lube stocks on both side of the border. About 25% of the U.S. refinery capacity is located on the Gulf and was severely affected by the weather phenomenon.
Money has been poured into the commodities markets recently as the U.S. dollar fell against the Euro. Crude oil prices have risen from a low of $33 to $72 a barrel last week.
For month investors months have used crude oil as their hedge against inflation, betting that oil prices will likely increase as the economy improves and global supplies start to shrink.
So far 2009 has turned into the first normal year for the petroleum markets since 2004 due to the absence of the high roller speculators and adverse weather conditions. Those investors were burned in the big oil price freefall during the second half of 2008 by following bad advice from their investment brokers.
In August 2009 the U.S. Security and Exchange Commission took initial steps to enforce the strict limitations on dealings between bankers and stock analysts. The law requires investment firms to engage in “fair dealings with customers” and prohibits in-house analysts from issuing opinions and research reports that are at odds with their true beliefs about the market. These opinions are spread fast, far and wide utilizing today’s high tech communications.
The market is also very nervous after news that the Chicago Mercantile Exchange (CME) Group, which runs the New York Mercantile Exchange (NYMEX), notified traders and brokers of tighter enforcement of existing position limits on NYMEX, CME, and other exchanges as of September 14, 2009.
US oil refiners, who were producing diesel in record numbers last year, reversed course earlier this year and made their refining stream fall in line with the flat demand for gasoline and the ever shrinking demand for diesel fuel. Refinery runs have drifted down to 86.94% of capacity from the previous week's 87.2%. Inventories of crude oil and its finished products are at all time high.
That will have the affect of starting the downward slide for gasoline and diesel fuel prices with the price of crude oil following right along.
Bob van der Valk is the Director of US Branded Licensing and Fuel-Pricing Analyst with 4Refuel Inc. in Lynnwood, Washington and can be contacted at (425) 216-9072 or by email at bvan@4refuel.com and web site: http://www.4refuel.com/
Bob’s professional web site is: www.4vqp.com/ourconsultants/thegasguy.html
Any views expressed in this newsletter are those of the writer, except where the writer specifically states them to be the views of the 4Refuel group of companies.
Showing posts with label economy. Show all posts
Showing posts with label economy. Show all posts
Monday, September 21, 2009
Sunday, July 19, 2009
When Goldman Sachs wins – You lose
Dateline: Terry, Montana
July 19. 2009
By: Bob van der Valk
The taxpayers of the US are the losers with Goldman Sachs (GS) employees the winners in this game called “Last Man Standing”. With most of their competitors being either bought out under duress or allowed to go bankrupt they have been left holding the bag. Even a leprechaun could not have been as lucky as to finding a bag so full of gold.
Nomi Prins, a former managing director for Goldman Sachs in New York, was interviewed by Juan Gonzalez for “Democracy Now!” right after the record profits at GS was announced.
Nomi Prins said that GS paid back the $10 billion Troubled Asset Relief Program (TARP) money in order to avoid the type of media scrutiny AIG received after they announced their employee bonus payouts earlier this year. She went on to explain in the interview:
“The bigger amount of money that has gone to Goldman has come through $12.9 billion from the AIG bailout that went straight to Goldman, its biggest counterpart; $28 billion worth of FDIC-backed guaranteed debt, meaning the FDIC put up a program last fall, and it said, “For banks that deal with consumers”—not banks that deal with multibillion-dollar companies or investors, but people—“we will provide guarantees for debt,” which means that those companies can raise debt to help consumers cheaply. Goldman said, “Alright, fine, we’ll take some of that.” And they took $28 billion worth of that, and they have up to $35 billion that they can take under the FDIC program that was never meant for a company like Goldman Sachs.
In addition, there is a ton of money, there are trillions of dollars at the Fed, not all of that went to Goldman, but that has secretly gone to a number of banks in the system, of which Goldman is one, for which the Fed refuses to disclose any information or any detail, which also goes into this. So when Goldman says—has the nerve to say, feels entitled to say—that it’s going to pay its bankers record bonuses after the travesty that it and other banks have created in the markets, it is on the back of federal subsidies that effectively come from our pockets.”
The result of those record profits is that Goldman Sachs (GS) will be paying out record bonuses to their employees this year on the backs of the US taxpayers. Their public relations department has a bunker mentality and has only opened their gun turrets long enough to shoot down any of the arguments being put up by the pundits who are against them paying out those bonuses.
The stock market investment community is also celebrating this turn of events and points to the record profits at GS as a sign that the economy is recovering. It has at least for the employees of GS but the remainder of the country continues to suffer record unemployment and is still looking for answers that will get us out our economic quack mire.
The actual count in dollars the US government is guaranteeing the banking business keeps going up every day. Right now those guarantees are up to almost 14 trillion dollars. As a form of comparison that amount would pay off every single mortgage in this country, healthcare and subsidizing student loans. Do you know of any individual consumer who has actually been able to walk into a GS bank and borrow money for a business or buy a car?
One way to stop this taxpayer bail out mess is for the Federal Election Commission to include a provision in their rules that would prohibit any of the companies receiving TARP money to make contributions to any candidate for federal office under the Federal Campaign Finance Laws. The time limit will be five years from the date the TARP money was paid out and will put an end to this endless cycle of “You rub my back and I’ll rub yours”.
July 19. 2009
By: Bob van der Valk
The taxpayers of the US are the losers with Goldman Sachs (GS) employees the winners in this game called “Last Man Standing”. With most of their competitors being either bought out under duress or allowed to go bankrupt they have been left holding the bag. Even a leprechaun could not have been as lucky as to finding a bag so full of gold.
Nomi Prins, a former managing director for Goldman Sachs in New York, was interviewed by Juan Gonzalez for “Democracy Now!” right after the record profits at GS was announced.
Nomi Prins said that GS paid back the $10 billion Troubled Asset Relief Program (TARP) money in order to avoid the type of media scrutiny AIG received after they announced their employee bonus payouts earlier this year. She went on to explain in the interview:
“The bigger amount of money that has gone to Goldman has come through $12.9 billion from the AIG bailout that went straight to Goldman, its biggest counterpart; $28 billion worth of FDIC-backed guaranteed debt, meaning the FDIC put up a program last fall, and it said, “For banks that deal with consumers”—not banks that deal with multibillion-dollar companies or investors, but people—“we will provide guarantees for debt,” which means that those companies can raise debt to help consumers cheaply. Goldman said, “Alright, fine, we’ll take some of that.” And they took $28 billion worth of that, and they have up to $35 billion that they can take under the FDIC program that was never meant for a company like Goldman Sachs.
In addition, there is a ton of money, there are trillions of dollars at the Fed, not all of that went to Goldman, but that has secretly gone to a number of banks in the system, of which Goldman is one, for which the Fed refuses to disclose any information or any detail, which also goes into this. So when Goldman says—has the nerve to say, feels entitled to say—that it’s going to pay its bankers record bonuses after the travesty that it and other banks have created in the markets, it is on the back of federal subsidies that effectively come from our pockets.”
The result of those record profits is that Goldman Sachs (GS) will be paying out record bonuses to their employees this year on the backs of the US taxpayers. Their public relations department has a bunker mentality and has only opened their gun turrets long enough to shoot down any of the arguments being put up by the pundits who are against them paying out those bonuses.
The stock market investment community is also celebrating this turn of events and points to the record profits at GS as a sign that the economy is recovering. It has at least for the employees of GS but the remainder of the country continues to suffer record unemployment and is still looking for answers that will get us out our economic quack mire.
The actual count in dollars the US government is guaranteeing the banking business keeps going up every day. Right now those guarantees are up to almost 14 trillion dollars. As a form of comparison that amount would pay off every single mortgage in this country, healthcare and subsidizing student loans. Do you know of any individual consumer who has actually been able to walk into a GS bank and borrow money for a business or buy a car?
One way to stop this taxpayer bail out mess is for the Federal Election Commission to include a provision in their rules that would prohibit any of the companies receiving TARP money to make contributions to any candidate for federal office under the Federal Campaign Finance Laws. The time limit will be five years from the date the TARP money was paid out and will put an end to this endless cycle of “You rub my back and I’ll rub yours”.
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