Will QE3 result in $5 gas in the US | |
Phennommennonn Forum Administrator 09/09/2012 11:59 AM Report Abusive Post Report Copyright Violation | Why QE3 Is Coming Next Week [link to www.businessinsider.com] political correctness is a doctrine.... fostered by a delusional, illogical minority...... and rabidly promoted by an unscrupulous mainstream media; which holds forth the proposition that it is entirely possible to pick up a turd by the clean end. |
Anonymous Coward User ID: 5944433 United States 09/09/2012 12:02 PM Report Abusive Post Report Copyright Violation | qe3 is pretty much priced into the price of gas. will we see $5 gas by the end of the year? i doubt it, as transportation has been selling off. it would take a major middle east event to get it to move that far up. if were gonna see any move it's to the downside (i'm speaking short term of course), china announced weak economic data last night, germany could rule against the esm this week (though unlikely) and the fed may not ease via another round of balance sheet expansion. most of these things are priced in, so should they not happen expect a sell off (coinciding with transports which are leading indicators) |
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Saddletramp User ID: 740874 Puerto Rico 09/09/2012 12:20 PM Report Abusive Post Report Copyright Violation | qe3 is pretty much priced into the price of gas. will we see $5 gas by the end of the year? i doubt it, as transportation has been selling off. it would take a major middle east event to get it to move that far up. Quoting: Anonymous Coward 5944433 if were gonna see any move it's to the downside (i'm speaking short term of course), china announced weak economic data last night, germany could rule against the esm this week (though unlikely) and the fed may not ease via another round of balance sheet expansion. most of these things are priced in, so should they not happen expect a sell off (coinciding with transports which are leading indicators) This depends entirely on the size and type of QE package they announce...assuming they do announce! A QE of over 1 Trillion will probably result in $150 crude oil (even without war in the Middle-East), meaning gas well over $5.00 per gallon... A QE of Bond Purchases and swaps below 1 Trillion and we will see a slight short term bump, but is likely priced into the market for the most part... Any bump to equities will be short lived, a three to four month rally at best, commodities may fare better due to devaluation of currencies world wide... "And how can a man die better than facing fearful odds, for the ashes of his fathers, and the temples of his Gods..." ~ Horatius "Because he told the truth, and once you've heard the truth, everything else is just cheap whiskey..." "We don't rent pigs!" |
Anonymous Coward User ID: 22162470 United States 09/09/2012 12:21 PM Report Abusive Post Report Copyright Violation | qe3 is pretty much priced into the price of gas. will we see $5 gas by the end of the year? i doubt it, as transportation has been selling off. it would take a major middle east event to get it to move that far up. Quoting: Anonymous Coward 5944433 if were gonna see any move it's to the downside (i'm speaking short term of course), china announced weak economic data last night, germany could rule against the esm this week (though unlikely) and the fed may not ease via another round of balance sheet expansion. most of these things are priced in, so should they not happen expect a sell off (coinciding with transports which are leading indicators) If you believe anything you wrote you are an un-educated fool ! |
Saddletramp User ID: 740874 Puerto Rico 09/09/2012 12:30 PM Report Abusive Post Report Copyright Violation | If anyone wants my thoughts on this, and it's probably worth what it's costing you, here they are... The Fed does NOT want to appear political. Not to say they aren't political, but they do have to work with both parties in Congress, so they hate to change policy in the midst of an election cycle for fear of alienating one side of the aisle. That said, if it means putting a bandaid on a potential collapse of a major U.S. Bank, or the economy as a whole, I think they will do it regardless of the political implications, because I truly believe their number one priority right now is staving off a financial collapse until after the November elections. It's interesting to me that China announced their new QE program a couple of weeks ago, then the ECB announced theirs this last week, that is an indication that the FED won't be too far behind, as these things are usually coordinated. So let's assume there will be a QE3, or whatever number we are really on, before the November elections. What should we expect? First, expect a market rally in equities and commodities. Some QE has already been priced in, but if they make a big enough splash you could see the DOW at 15000, Oil at $150.00 (even without a war in the Middle-East) and Gold at $1900. BUT, how long will the rally last? Even if they do it this month, I don't think it will last much past the end of the year, at least for equities and the DOW. Here's why, QE in a chronically low interest rate environment has a continually deminishing rate of return, and interest rates have been way too low, for way too long. Money, from a depository standpoint, is essentially worthless already. If we were going to get any real financial benefit from all of this QE and effective interest rates of Zero, we would have already seen it, and the ECB is now on their second QE of 2012, if you remember they loaned European Banks over 1.25 Trillion Dollars back at the beginning of the year, and that barely bought them six months before they had to begin slapping more bandaids on. Expect the same thing from a FED QE, only with perhaps a shorter duration of relief. I give the next QE three to four months of effectiveness at the most... You see econommists really have no idea of the fire they are playing with here. I've said several times that the next QE is the last QE, at least for the FED, and I stand by that statement. We've never in our history had interest rates this low, for this long. When you factor in inflation and real currency devaluation, the rates are effectively negative. But still NO GROWTH. You see folks, the problem is not liquidity, so printing cash does little to nothing to fix it. The problem is debt, and their solution is...more debt. So don't expect QE to be a savior of our financial system, it just means the FED has no other tools left in the tool box. Expect to be able to play these equity markets long for a few more months, then you better start looking for shorts. Expect commodities to go to the moon and possibly stay there, because of the amount of currency devaluation we will see with this QE... In any case...Have fun storming the castle... "And how can a man die better than facing fearful odds, for the ashes of his fathers, and the temples of his Gods..." ~ Horatius "Because he told the truth, and once you've heard the truth, everything else is just cheap whiskey..." "We don't rent pigs!" |
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Anonymous Coward User ID: 5944433 United States 09/09/2012 12:33 PM Report Abusive Post Report Copyright Violation | qe3 is pretty much priced into the price of gas. will we see $5 gas by the end of the year? i doubt it, as transportation has been selling off. it would take a major middle east event to get it to move that far up. Quoting: Anonymous Coward 5944433 if were gonna see any move it's to the downside (i'm speaking short term of course), china announced weak economic data last night, germany could rule against the esm this week (though unlikely) and the fed may not ease via another round of balance sheet expansion. most of these things are priced in, so should they not happen expect a sell off (coinciding with transports which are leading indicators) If you believe anything you wrote you are an un-educated fool ! the market has moved 10% up the last few months on weak economic data on the anticipation of cb action. this move is worth ~$1 trillion in anticipated action. given that inflation is keeping china from easing and europe's easing could be ruled unconstitutional the short-run move in gas prices is to the downside. if qe3 is a trillion dollars (keep in mind there are only 540 billion dollars in 10+ years that the fed hasn't bought), the market does nothing. if any the esm is ruled unconstitutional and/or qe3 is less than 1 trillion we will most likely see a decrease in gas prices. also keep in mind that obama may tap the reserves for political purposes. please note this is all short term discussion, qe3 will not likely move gas to $5. will we ever have $5, $7, $9 gas with the current actions we keep taking? absolutely. |
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Anonymous Coward User ID: 22162470 United States 09/09/2012 12:41 PM Report Abusive Post Report Copyright Violation | qe3 is pretty much priced into the price of gas. will we see $5 gas by the end of the year? i doubt it, as transportation has been selling off. it would take a major middle east event to get it to move that far up. Quoting: Anonymous Coward 5944433 if were gonna see any move it's to the downside (i'm speaking short term of course), china announced weak economic data last night, germany could rule against the esm this week (though unlikely) and the fed may not ease via another round of balance sheet expansion. most of these things are priced in, so should they not happen expect a sell off (coinciding with transports which are leading indicators) If you believe anything you wrote you are an un-educated fool ! the market has moved 10% up the last few months on weak economic data on the anticipation of cb action. this move is worth ~$1 trillion in anticipated action. given that inflation is keeping china from easing and europe's easing could be ruled unconstitutional the short-run move in gas prices is to the downside. if qe3 is a trillion dollars (keep in mind there are only 540 billion dollars in 10+ years that the fed hasn't bought), the market does nothing. if any the esm is ruled unconstitutional and/or qe3 is less than 1 trillion we will most likely see a decrease in gas prices. also keep in mind that obama may tap the reserves for political purposes. please note this is all short term discussion, qe3 will not likely move gas to $5. will we ever have $5, $7, $9 gas with the current actions we keep taking? absolutely. You act as if the market got there all by itself through the "Open & Free", honest price discovery free market system with no intervention from the PPT. Everthing you see is an illusion created from a printing press. The price of oil must continue to increase through the demand of Petrodollars or the U.S. dollar will lose it's reserve currency status that it uses to influence and control the world. |
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Anonymous Coward User ID: 20220748 United States 09/09/2012 12:50 PM Report Abusive Post Report Copyright Violation | Indeed....I just bought my bug-out-bike, I knew this was going to happen. [link to en.wikipedia.org] |
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Phennommennonn Forum Administrator 09/09/2012 12:52 PM Report Abusive Post Report Copyright Violation | yeah just in time for my beach vacation. looks like the suvs stayn parked. ill have to travel via the car. political correctness is a doctrine.... fostered by a delusional, illogical minority...... and rabidly promoted by an unscrupulous mainstream media; which holds forth the proposition that it is entirely possible to pick up a turd by the clean end. |
Saddletramp User ID: 740874 Puerto Rico 09/09/2012 01:24 PM Report Abusive Post Report Copyright Violation | qe3 is pretty much priced into the price of gas. will we see $5 gas by the end of the year? i doubt it, as transportation has been selling off. it would take a major middle east event to get it to move that far up. Quoting: Anonymous Coward 5944433 if were gonna see any move it's to the downside (i'm speaking short term of course), china announced weak economic data last night, germany could rule against the esm this week (though unlikely) and the fed may not ease via another round of balance sheet expansion. most of these things are priced in, so should they not happen expect a sell off (coinciding with transports which are leading indicators) If you believe anything you wrote you are an un-educated fool ! the market has moved 10% up the last few months on weak economic data on the anticipation of cb action. this move is worth ~$1 trillion in anticipated action. given that inflation is keeping china from easing and europe's easing could be ruled unconstitutional the short-run move in gas prices is to the downside. if qe3 is a trillion dollars (keep in mind there are only 540 billion dollars in 10+ years that the fed hasn't bought), the market does nothing. if any the esm is ruled unconstitutional and/or qe3 is less than 1 trillion we will most likely see a decrease in gas prices. also keep in mind that obama may tap the reserves for political purposes. please note this is all short term discussion, qe3 will not likely move gas to $5. will we ever have $5, $7, $9 gas with the current actions we keep taking? absolutely. Did you just say China won't move for fear of inflation?!?!? Where were you two weeks ago...when they moved!!! [link to www.businessinsider.com] "And how can a man die better than facing fearful odds, for the ashes of his fathers, and the temples of his Gods..." ~ Horatius "Because he told the truth, and once you've heard the truth, everything else is just cheap whiskey..." "We don't rent pigs!" |
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Anonymous Coward User ID: 5944433 United States 09/09/2012 01:37 PM Report Abusive Post Report Copyright Violation | qe3 is pretty much priced into the price of gas. will we see $5 gas by the end of the year? i doubt it, as transportation has been selling off. it would take a major middle east event to get it to move that far up. Quoting: Anonymous Coward 5944433 if were gonna see any move it's to the downside (i'm speaking short term of course), china announced weak economic data last night, germany could rule against the esm this week (though unlikely) and the fed may not ease via another round of balance sheet expansion. most of these things are priced in, so should they not happen expect a sell off (coinciding with transports which are leading indicators) If you believe anything you wrote you are an un-educated fool ! the market has moved 10% up the last few months on weak economic data on the anticipation of cb action. this move is worth ~$1 trillion in anticipated action. given that inflation is keeping china from easing and europe's easing could be ruled unconstitutional the short-run move in gas prices is to the downside. if qe3 is a trillion dollars (keep in mind there are only 540 billion dollars in 10+ years that the fed hasn't bought), the market does nothing. if any the esm is ruled unconstitutional and/or qe3 is less than 1 trillion we will most likely see a decrease in gas prices. also keep in mind that obama may tap the reserves for political purposes. please note this is all short term discussion, qe3 will not likely move gas to $5. will we ever have $5, $7, $9 gas with the current actions we keep taking? absolutely. Did you just say China won't move for fear of inflation?!?!? Where were you two weeks ago...when they moved!!! [link to www.businessinsider.com] i said they wouldn't ease, e.g. a rate cut. western media keeps believing the chinese will cut rates like the west, but they can't because they have to feed 1 billion people. they ease, the cost of feeding all those people increases, basically netting out any benefit of easing (if not a creating a negative effect). a 150 billion dollar infrastructure plan is minimal in comparison to the unlimited bond buying the draghi wants to do and the 2 trillion + qe3 the fed wants to do. just watch the asian markets tonight, they are going to drop on last evenings chinese economic data. |
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Anonymous Coward User ID: 5944433 United States 09/09/2012 01:45 PM Report Abusive Post Report Copyright Violation | qe3 is pretty much priced into the price of gas. will we see $5 gas by the end of the year? i doubt it, as transportation has been selling off. it would take a major middle east event to get it to move that far up. Quoting: Anonymous Coward 5944433 if were gonna see any move it's to the downside (i'm speaking short term of course), china announced weak economic data last night, germany could rule against the esm this week (though unlikely) and the fed may not ease via another round of balance sheet expansion. most of these things are priced in, so should they not happen expect a sell off (coinciding with transports which are leading indicators) If you believe anything you wrote you are an un-educated fool ! the market has moved 10% up the last few months on weak economic data on the anticipation of cb action. this move is worth ~$1 trillion in anticipated action. given that inflation is keeping china from easing and europe's easing could be ruled unconstitutional the short-run move in gas prices is to the downside. if qe3 is a trillion dollars (keep in mind there are only 540 billion dollars in 10+ years that the fed hasn't bought), the market does nothing. if any the esm is ruled unconstitutional and/or qe3 is less than 1 trillion we will most likely see a decrease in gas prices. also keep in mind that obama may tap the reserves for political purposes. please note this is all short term discussion, qe3 will not likely move gas to $5. will we ever have $5, $7, $9 gas with the current actions we keep taking? absolutely. You act as if the market got there all by itself through the "Open & Free", honest price discovery free market system with no intervention from the PPT. Everthing you see is an illusion created from a printing press. The price of oil must continue to increase through the demand of Petrodollars or the U.S. dollar will lose it's reserve currency status that it uses to influence and control the world. you're putting words into my mount, i never once said its open & free price discovery. is the ppt intervening? probably not directly. most of this run up is a melt up on low volume from algo buying the jawboning easing from bernanke and draghi's mouths. you're going to start seeing growth problems and a slowing of the economy due to high energy costs. this will keep the fed from a massive qe (1 trillion between euro and us combined is already priced in). the last thing they want is to do a shock and awe and spike the price of gas before the election. while obama could certainly tap the reserves, the move would look political and he probably does not want that publicity. |