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Oil Collapse Threatens Universe

George Ure at Urban Survival blows my mind with this information today about the Oil Collapse:

Oil Price Collapse

Oil Price Collapse

But for the past many months I have been telling you what? ‘

That right: Oil could collapse into the $30s per barrel.

That’s because the world is in the grips of a gigantic deflation the likes of which have never been seen before and that in itself is remarkable and worthy of discussion.

First, however, we need to be clear that a barrel is not a barrel. If you are talking about the ubiquitous 55-gallon drums, popular in American chemical, refining, and coatings, that’s not what a barrel of oil is: Write this down: Oil is 42 gallons per barrel.

Just how cheap is oil, right now? Well, if you drop by the local convenience store this morning, oil is cheaper than your coffee by a damn-sight. Grab a bottle of that water (a large Desani or Aqu-What’s-It) and you will pay more for the water than for oil. (Admittedly, there’s a price off convenience and maybe if water folks made a 42-gallon size. Even so, compare oil to those 5-6 gallon water jugs at the store.

While all of this may sound like really, really good news, oil breaking into the $51 range this morning increases the odds of panic in financial markets this spring. Think you could wake up to a Dow 2,500-4,000 points lower than where we are right now before summer? Don’t bet against it.

Part of the reason oil was so high (for so long) is the Fed’s quantitative easing. Usually when there’s a big recession (remember 2007-2010?) prices come right down, everyone sees a bargain, and recovery begins.

Unfortunately, what the Fed’s money give-aways have done is set a semi-permanent deflation expectation in place. While the QE money kept deflation from becoming obvious (and wage collapsing, and even more massive unemployment) it is now off the table and the price of oil is dropping quickly.

Let’s run a number or two to show economic impacts: Let’s say you bought a car getting 18 MPH highway, $4.25 Gas and drove 100,000 miles. Total fuel bill? $23.611.

Fast forward to my son’s car (Versa) mostly highway and around 37 MPG and gasoline we’ll use Triple A’s national average of $2.199. Driving it the same 100,000 miles, his fuel bill will only come to $5,943 and change.

This is whatcha call an economic shock. Car costs (on a real cost per mile basis) are down to about 1/4 of where they were in the past 7-years. This is deflation and huge deflation at that.

Oil could drop down to the $50 range. But if it can take out $50, why not $48? And then what holds it at $45? You see how this goes.

Race


College Footbowl Upsets

So Far:

NC State (8-5) 34, UCF (9-4) 27

Virginia Tech (7-6) 33, Cincinnati (9-4) 17

UPDATE:

Notre Dame 31, #23 LSU 28

UPDATE:

#1 ALABAMA 35, #4 OHIO ST 42

#5 Baylor 41, #8 Michigan St 42

#7 Mississippi St. 34,#12 Georgia Tech 49

#10 Arizona 30, #20 Boise St 38

#11 Kansas St. 35, #14 UCLA 40

Washington (8-6) 22, Oklahoma St (7-6)  30

East Carolina (8-5) 20, Florida (7-5) 28

AND IN A BUTT WHIPPING: #2 OREGON 59, #3 FSU 20

Mario Cuomo R.I.P.

abcnews.go.com

abcnews.go.com

The accolades are rolling in for liberal, and former Governor Mario Cuomo. He was a great speaker. He could convince a swinging door not to swing. Yet, with all his speechability, he never tried to persuade his party to believe like he did on abortion,

“It seems to me that someone who claims to be opposed to abortion, as Cuomo claims he was (see below), would have spent a great deal of time using his speaking gifts to persuade people that abortion is a moral wrong and thus create a moral consensus against it. Here’s what he said in his address:

“As Catholics, my wife and I were enjoined never to use abortion to destroy the life we created, and we never have. We thought Church doctrine was clear on this, and — more than that — both of us felt it in full agreement with what our hearts and our consciences told us. For me life or fetal life in the womb should be protected, even if five of nine Justices of the Supreme Court and my neighbor disagree with me. A fetus is different from an appendix or a set of tonsils. At the very least, even if the argument is made by some scientists or some theologians that in the early stages of fetal development we can’t discern human life, the full potential of human life is indisputably there. That — to my less subtle mind — by itself should demand respect, caution, indeed . . . reverence.

“But not everyone in our society agrees with me and Matilda.”

Was Governor a coward for not trying to use his wonderous ability to persuade his liberal followers that abortion is just out and out wrong. I am not arguing that a woman doesn’t have the right to terminate a pregnancy, but more time should be spent by all arguing about the morality of such an act. Once again over 327,0o0 babies were terminated by Planned Parenthood in 2014.  That’s a talent pool that was utterly wasted.

 

2015: THE YEAR OF GLOBAL DOLLAR DANGER

By Ambrose Evans-Pritchard at To the Point News
Guest Authors
Thursday, 01 January 2015

America’s domestic economy can handle a surging dollar and a fresh cycle of rising interest rates. Large parts of the world cannot. That in a nutshell is the story of 2015.

Tightening by the US Federal Reserve will have turbo-charged effects on a global financial system addicted to zero rates and dollar liquidity.

Yields on 2-year US Treasuries have more than doubled from 0.31% to 0.74% since October, and this is the driver of currency markets.

Since the New Year ritual of predictions is a time to throw darts, here we go: the dollar will hit $1.08 against the euro before 2015 is out ($1.21 on 12/31), and 100 on the dollar index (already at 90 at year’s end).

Sterling (the British pound) will buckle to $1.30 ($1.57 on 12/31) as a hung Parliament prompts global funds to ask why they are lending so freely to a country with a current account deficit reaching 6% of GDP.

There will be a mouth-watering chance to invest in the assets of the BRICS and mini-BRICS at bargain prices, but first they must do penance for $5.7 trillion in dollar debt, and then do surgery on obsolete growth models. What are the odds for either?

Three Oregon Quakes

M 2.3 – 34km SSE of Mount Hood Village, Oregon

Time
Location
45.082°N 121.762°W
Depth
6.1km

 

M 1.7 – 8km NW of McMinnville, Oregon

Time
Location
45.267°N 123.273°W
Depth
18.6km

M 1.6 – 28km WNW of Klamath Falls, Oregon

Time
Location
42.358°N 122.083°W
Depth
17.6km

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