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OIL!

May 21, 2008 – 1:23 pm

The leading economic indicators report released the other day actually increased. It was not flat or down as expected but actually moved up. Granted it was a small move at .1% which certainly reminds us that the economy is still weak, but remember this is a report on what is going to happen in the future. It appears we are no longer shrinking our economy. 

However, oil prices are rising sharply and that has swamped any other news. At $131 dollars a barrel and still rising, pressure on the economy is assumed and inflation is very much in play despite recent reports saying inflation is not out of control. It may not be out of control but it is here to stay.  

The stock market is holding up well despite the ever increasing oil price rise. What happens if it starts to fall? The speculators are the driving force now not the underlying fundamental demand. Yes, demand is going up but not enough to justify current prices. 

Good Trading
Steve Peasley 

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