Comments on: Five Reasons Why the $700 Billion Banking Bailout Will Translate into $250 Oil

By: Awake

Awake — Wed, 12 Nov 2008 04:23:43 +0000

“But I continued to make the opposite argument. And a week ago, the markets made my point for me. On Sept. 22, crude oil futures for October delivery soared $16.37 a barrel, or 15.7%, to close at $120.92, after trading as high as $130 a barrel – thanks to a steep decline in the U.S. dollar and to speculation that the Bush administration’s plan to bail out the financial sector might actually jump-start the U.S. economy, fueling inflation in the process. The gain surpassed the previous record single-day-price gain of $10.75 a barrel, a move that occurred on June 6. [The biggest-ever percentage gain in a single day - 20.9% - was recorded on Jan. 3, 1994, according to FactSet Research Systems Inc.]”

I stopped reading this article right here, and any chance of me subscribing to this report died with it.

Mr. Fitz-Gerald, were you in a coma on the day of September 22nd?

You are correct in the statement: “crude oil futures for October delivery soared $16.37 a barrel, or 15.7%, to close at $120.92, after trading as high as $130 a barrel”

But your reasoning is completely false and it calls your credibility into question. Sept. 22nd is the last day to trade the futures contract expiring in Oct. All shorts either had to settle on that day or actually take delivery of the physical product (can you imagine 1,000 barrels of oil delivered to some brokerage house’s doorstep via Navy Pier? neither can I).

It was a classic short squeeze. And, you’ll note that the VERY NEXT DAY, oil opened at $106 per barrel. It didn’t “gap down” from 120. It OPENED at $106. Because there was a new contract being traded (the benchmark front-month contract).

To anyone that reads this: I am a first year analyst at an investment bank and apparently am better versed in the oil futures market than Mr. Fitz-Gerald. Take his advice/subscription service with a grain of salt.

By: John

John — Mon, 13 Oct 2008 15:25:59 +0000

You’re brilliant, that’s why oil has been going straight down since you wrote this. We could see 70 soon and 50 is possible, but I do believe $200 and more is reachable in the next year or two. We could easily be looking at $8 a gallon for gas or even more in the next few years.

By: Jose

Jose — Fri, 10 Oct 2008 18:58:44 +0000

The article is very poor. It mixes different term issues, like reserves in 2030 and bailout in 2008.

I guess oil will remain bellow $70 in 2009. Prices will increase with the combination of economic growth and peak-oil, but this will be in 3-5 years.
Regards,
JL

By: WHAT’S NEWS TODAY IN NABWEEKLY.CA » Oversee Underminding

WHAT’S NEWS TODAY IN NABWEEKLY.CA » Oversee Underminding — Thu, 09 Oct 2008 00:24:16 +0000

[...] If you must invest…invest in oil. Sure something we don’t want more of but if the consumers control oil stocks then they are more likely to be the future dicator of it’s price. As Nabweekly.ca spends much of our day reading and subscribing to many reputable news readers around the globe, and connecting the common links, this is one subscription we have been following for many months and to date, they have been bang on the money…Read more on “Five Reason’s the $700 billion dollar bailout will translate into $250 oil [...]

By: Stephen

Stephen — Mon, 06 Oct 2008 07:44:52 +0000

You analysis is deeply flawed.The bail out will crash the dollar inevitably.

First,how is the bailout financed?China,Russia,The Arabs have had enough of wortless bonds.They will sell once the fed starts merely printing green paper.

Secondly,the US is in its death throes.The muliplicity of deficits are simply unsustainable.The US $ is too faulted to be a serious currency of exchange.Both the US and its citizens have maximised their debt.Banks with money achieve nothing if no consumers borrow more.A spirally pattern of recession leading to depression is inevitable.House prices will drop another 30-50 %.Back to historic means.All returns to the mean.

That is a fast rather limited summation.The fact that markets continue to drop tells you,the public is not conned by government lies.
Regards Stephen

By: Finding the Truth

Finding the Truth — Mon, 06 Oct 2008 03:02:14 +0000

[...] 5 reasons why the banking bailout will result in $250 oil. [...]

By: Pete Hunter

Pete Hunter — Sun, 05 Oct 2008 15:48:22 +0000

When the dollar tanks and hyperinflation becomes imminent won’t the federal government make everyone hand over their gold in exchange for deteriorating dollars.
? Last time that happened you could keep US gold coins, because that is “specie”. So how should we hold our gold? Maybe they will even make us turn in our gold-backed paper.

By: clyde carter

clyde carter — Sun, 05 Oct 2008 11:40:54 +0000

why is the typed letters in your e-mails so much smaller than
most others? Makes them harder to read.Think about thar

By: Alternative Fuels Now » DrumBeat: October 1, 2008

Alternative Fuels Now » DrumBeat: October 1, 2008 — Sun, 05 Oct 2008 08:13:00 +0000

[...] Five Reasons Why the $700 Billion Banking Bailout Will Translate into $250 Oil I’ve been predicting record oil prices for a number of years now, so when crude oil prices recently plunged from their record highs, I warned investors and consumers that the decline was nothing more than a temporary respite. [...]

By: Andy Abraham

Andy Abraham — Fri, 03 Oct 2008 10:44:22 +0000

This is an interesting take on the situation… what does the man on the street do.??? We spoke all week on myinvestorsplace.com …on the forums… in chats… amongest ourselves… but what do we really do…what can we do…????

What are your thoughts..??? Will it make a difference either way the vote goes today?