Google got mad at me again over the past two days...or maybe I just messed up which could be the case but the result was I could publish nada. Which perhaps wasn't a bad thing because nothing that I was writing made sense 24 hours later which gave me time to reflect and pause for a moment in my certitude.
Unlike the mystery of the fault--was it me or Google--I'm pretty sure about this: nothing that I was writing made sense because nothing out there is making any sense at all. I am completely confused as to what is going on as is I think everyone else.
Take oil: WTI traded up to $47 a barrel last week and the sentiment on the Street was that the market had stabilized. Only problem was there was more of a glut last week than ever and there appears to be no end in sight. The U.S. is importing more oil than in the past two years while production has fallen just 3%. Why? Well, according to the WSJ, it is cheaper to store oil in the U.S. than on a ship and surprise, surprise, the U.S. has a great deal of excess storage capacity. Coulda fooled me, but there ya go and on cue WTI traded down to $43 today. Now that's a hell of a lot higher than the $26 of a few months back but apparently Iran is pumping and selling so fast it would make your turban spin and selling it at a discount in Europe to buy back market share. Needless to say, so is everybody else to preserve market share. See what I mean? What's going on out there?
Bond yields, after a brief spurt, seem to be indicating that the future is not bright but in regard to the stock market the talking heads have come to the conclusion that equities are "fully priced," either indicating a satisfaction with things or a complete lack of alternatives for investment. Now if the bond guys are right and the market is fully priced, some people are going to lose a hell of a lot of money pretty soon. I know about losing money.
Puerto Rico had their first default on Monday worth $400 million and seem to be heading for a second of $1 billion in about a month with the Congress playing politics as to how to solve this problem. A mess in the muni market one would think? Nah, nothing moved despite the fact that all the rules of the game could get changed overnight. It restores faith in humanity.
We had a bank failure in Italy the other Day. Big Deal? Not really except that those clever Italians had, in i scuri set up a living will for this institution focusing on it's take-over by Unibanco. Only problem was when Unibanco popped up to announce that they really didn't think they were in a position to do that causing the government to institute an immediate bail-out which of course they are not supposed to do. BUT, not to worry because things are looking up for the Eurozone economy. Yeah sure. The largest bank in the third largest economy announces that it doesn't have the where-with-all to fulfill a previously agreed deal and things are looking up? On top of that, the latest out of the UK has the BREXIT polling just about dead even, tightening considerably in the two weeks post-Obama (gee, did I predict that?) with the referendum barely a month away. After three months without a government, Spain is about to have a new election and whilst there is little shouting thank goodness, Greece and its creditors are still somewhat at loggerheads. Buy Euros as suggested? Sorry can't see it.
And then there is China. I'm not even going to try. The latest big thing in China is commodity specu...ah...investing. Why not. The government in the first four months of the year pumped about a trillion and a half into the economy. Heck, you have to spend it somewhere. Good for the fly-over zone, however. Live Hogs have been up for a week. Who says we're not part of globalization.
I could get onto to Japan but that is a chapter in itself. Besides, the more I write on a wet, miserable day like this the more I get depressed. I should stop writing. I wonder. Did Google have my well-being in mind? What a lovely thought.
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