While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more
Global Market Comments
June 1, 2016
Fiat Lux
Featured Trade:
(JULY 22 ZERMATT, SWITZERLAND GLOBAL STRATEGY SEMINAR),
(WHY I DON?T CARE ABOUT OIL),
(USO), (UNG), (XOM)
United States Oil (USO)
United States Natural Gas (UNG)
Exxon Mobil Corporation (XOM)
With the price of oil closing at a low on Friday of $48.33, you?d think I might be concerned.
In actual fact, I could care less, am indifferent, unconcerned, and couldn't even give a rat?s ass.
In actual fact, oil was exactly at $48.33 a year ago. If you?d taken a one year cruise around the world, as I advised, you?d wonder what all the fuss is about.
Furthermore, I believe that oil could be at $48.33 a year from now. We may visit $60 first, then $40. But basically the price of oil has reached an equilibrium.
It is just high? enough to keep too many producers from going bankrupt, but low enough the keep that juggernaut, the America consumer, in the stores and buying.
There?s nothing like seeing your long-term forecasts vindicated.
When I warned the oil majors in the late 1990?s that fracking technology was about to change their world beyond all recognition, they told me I was out of my tree, in the politest way possible, as is their way in Houston.
Their argument was that the technology was untested, unproven, and a huge liability risk. If they accidently polluted underground fresh water supplies, the ambulance chasers would make a beeline towards the deepest pockets around, and that was theirs.
They were telling me this after I supplied them my data showing my 17 consecutive successful wells drilled in the depleted oilfields of the Barnett Shale, in West Texas (in the old Comanche country).
Some 17 years later and the energy industry has been changed beyond all recognition.
The majors finally jumped into fracking after building legal firewalls against the liability that so concerned them, and started fracking like there was no tomorrow.
The message is pretty clear. In the last five years, US oil production has skyrocketed from 8 million to 11.3 million barrels a day. It has since backed off 1 million b/d from the top.
America can now become the world?s largest oil producer any time it wants, eclipsing Saudi Arabia at 11 million b/d, and Russia at 10.5 b/d and falling. Thanks to the oil crash, there are now 1,000 wells that have been drilled, but capped, awaiting higher prices.
Some 200 large crude carriers are also slow steaming in circles around various parts of the world, awaiting the same.
Oil imports have collapsed from 10.3 to 6 million barrels a day. The share coming from the volatile Middle East has shrunk to a miniscule 2 million barrels a day.
Some 80% of Persian Gulf oil exports now go to China. OPEC surplus oil production capacity is soaring. It couldn?t happen to a nicer bunch of people.
The US will achieve energy independence within three years, or at least parity in its imports and exports of energy and distillates.
The administration is doing what it can to help along this trend, permitting the first exports of distillates in half a century, to South Korea it turns out.
Is it any wonder that president Obama is turning a blind eye to recent horrific developments in the Middle East? This explains why I really don?t care about oil prices anymore.
There is another upshot to all of this. About the time that America gets its energy independence back, it should also get a balanced budget.
That is coming primarily from the big cuts in defense spending. The twin deficits, energy and the budget, are intimately linked. It is no surprise then, they will disappear together.
By the way, did I mention that this is all great news for the long-term future for stock prices? The stock market certainly thinks so, with its stubborn refusal to fall substantially.
And for the price of oil?
I am not big buyer here. Nor am I a seller. We could ratchet back and forth within a $40-$60 range for quite some time.
Ask me again at either end of that range and I might be interested.
Just thought you?d like to know.
?There?s nothing but tailwinds behind the American consumer. You?re creating a boatload of jobs, you?re creating all kinds of jobs. Wage growth is accelerating. The stock market is at record highs. The debt service burden is as low as it has ever been. And consumer confidence is back to pre recession levels,? said Mark Zandi, chief economist at Moody?s Analytics.
Come join me for lunch for the Mad Hedge Fund Trader?s Global Strategy luncheon, which I will be conducting in Florence, Italy on Saturday, July 9, 2016.
A three-course lunch will be followed by an extended question and answer period.
I?ll be giving you my up to date view on stocks, bonds, foreign currencies, commodities, precious metals, and real estate.
And to keep you in suspense, I?ll be tossing a few surprises out there too. Enough charts, tables, graphs, and statistics will be thrown at you to keep your ears ringing for a week. Tickets are available for $227.
I?ll be arriving at 11:30 AM and leaving late in case anyone wants to have a one on one discussion, or just sit around and chew the fat about the financial markets.
The lunch will be held at an exclusive five star hotel in the downtown area of the city, the location of which will be emailed to you with your purchase confirmation.
Florence is one of those bucket list cities that everyone must visit once in their lives. I have been dropping by the Renaissance capitol since 1968.
Michelangelo?s statue of David, a true masterpiece, is a must see. The Galleria dell? Academia is one of the finest art museums in the world, as is the Uffizi Gallery.
The Duomo, the Cathedral of Santa Maria del Fiore, is a highpoint of medieval architecture. The ancient Ponte Vecchio, the only bridge the Germans failed to blow up during WWII, is perfect for souvenir shopping, but watch out for pickpockets!
For my stay in Florence I have rented one of the city?s lesser palaces. You will find me in the mornings at the Piazza del Signoria sipping my double espressos and practicing my Italian with the locals. It?s amazing what you can learn! Ciao!
I look forward to meeting you, and thank you for supporting my research.
To purchase tickets for the luncheons, please click here.
Come join me for afternoon tea for the Mad Hedge Fund Trader?s Global Strategy Seminar, which I will be conducting high in the Alps in Zermatt, Switzerland at 2:00 PM on Friday, July 22, 2016.
The guests and I will engage in an open discussion on the crucial issues facing investors today. Coffee, tea, and schnapps will be made available, along with light snacks.
I?ll be giving you my up to date view on stocks, bonds, foreign currencies, commodities, precious metals, and real estate. And to keep you in suspense, I?ll be throwing a few surprises out there too.
Enough charts, tables, graphs, and statistics will be thrown at you to keep your ears ringing for a week. Tickets are available for $197.
I?ll be arriving early and leaving late in case anyone wants to have a one on one discussion, or just sit around and chew the fat about the financial markets.
The event will be held at a central Zermatt hotel with a great Matterhorn view, operated by one of the village?s oldest families and long time friends of mine. The hotel is just down the street from the town?s beautiful 17th century church. The details will be emailed directly to you with your confirmation.
You are welcome to attend in your mountain climbing gear, but you will have to leave your boots at the door. Socks only are welcome, and if it?s cold, we will throw some extra wood on the fire.
Last year, someone came down from the Matterhorn summit straight to the seminar, sunburned and tired, but elated. He even gave me a valued pebble from the summit.
The Swiss National Day is on Monday, August 1 and Zermatters throw a blowout party to celebrate the event. Citizens converge on the village from all over Switzerland to participate in an hour long parade up the main cobblestoned street, dressed in traditional folk costume and playing mountain instruments.
The Bahnhofstrasse is packed with merchants offering national dishes, fine pastries and plenty of local beer and wine. We usually end up dancing a polka in front of the town church.
If you can still stand up, giant bonfires are lit on the surrounding mountain peaks at sunset, followed by an impressive fireworks display. For the last three years, a torrential downpour followed.
It is all a complete blast, so I attend every year.
I look forward to meeting you, and thank you for supporting my research.
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Come join me for lunch for the Mad Hedge Fund Trader?s Global Strategy luncheon, which I will be conducting in Dubrovnik, Croatia, on Thursday, July 7, 2016.
A three-course lunch will be followed by an extended question and answer period.
I?ll be giving you my up to date view on stocks, bonds, foreign currencies, commodities, precious metals, and real estate.
And to keep you in suspense, I?ll be tossing a few surprises out there too. Enough charts, tables, graphs, and statistics will be thrown at you to keep your ears ringing for a week. Tickets are available for $217.
I?ll be arriving at 11:30 AM and leaving late in case anyone wants to have a one on one discussion, or just sit around and chew the fat about the financial markets.
The lunch will be held at an exclusive five star hotel, the location of which will be emailed to you with your purchase confirmation.
Dubrovnik is the pearl of the Dalmatian Coast on the Adriatic Sea, and it?s a favorite yachting destination by vacationing continentals. It's white sand beaches and azure waters are legendary.
It was founded in the 7th Century by refugees fleeing the fall of the Roman Empire. At the height of its power in the 14th Century, it rivaled Venice for the domination of maritime trade in the Eastern Mediterranean. Today, it is a UNESCO World Heritage Site.
The last time I was there during the Yugoslavian civil war in the 1980?s, I was flying a humanitarian mission for the International Red Cross, delivering much-needed drugs to the beleaguered city.
On the way home, I got shot down by the Serbian Army. Fortunately, I managed to crash land my plane in the Austrian Alps and walk away.
While at the Tesla factory in June, amazingly, I ran across a couple of Austrian car dealers who still remember that frightful day.
This time around, I?ll spend my mornings writing deep research pieces for the Diary of a Mad Hedge Fund Trader, and the afternoons roasting on the beach. The evenings are reserved for dancing on the tables in the many local bars, celebrating life.
I look forward to meeting you, and thank you for supporting my research.
To purchase tickets to the luncheon, please click here.
Come join me for lunch for the Mad Hedge Fund Trader?s Global Strategy luncheon, which I will be conducting in Basel, Switzerland on Wednesday, July 27, 2016.
A three-course lunch will be followed by an extended question and answer period.
I?ll be giving you my up to date view on stocks, bonds, foreign currencies, commodities, precious metals, and real estate.
And to keep you in suspense, I?ll be tossing a few surprises out there too. Enough charts, tables, graphs, and statistics will be thrown at you to keep your ears ringing for a week. Tickets are available for $257.
I?ll be arriving at 11:30 AM and leaving late in case anyone wants to have a one on one discussion, or just sit around and chew the fat about the financial markets.
The lunch will be held at an exclusive five star hotel in the downtown area of the city, the location of which will be emailed to you with your purchase confirmation.
Basel is the city in Northwestern Switzerland where the German, French, and Italian cultures meet.
The third largest city in the country, it has been a major trade center since the Renaissance. During the 20th Century, it became the capital of the global pharmaceuticals industry.
Much of the Altstadt, where I?ll be staying, dates back to the 15th century. Basel offers a wealth of museums and other cultural amenities. It is also the site of many international conferences.
I know Basel well from my days as a director of the former Swiss Bank Corporation (now a subsidiary of UBS).
I look forward to meeting you, and thank you for supporting my research.
As a potentially profitable opportunity presents itself, John will send you an alert with specific trade information as to what should be bought, when to buy it, and at what price. Read more
While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more
