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Bonds & Interest Rates

Looming Tidal Wave of U.S. Oil Supply

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Posted by Larry Edelson - The Edelson Wave

on Friday, 27 January 2017 14:46

Screen Shot 2017-01-27 at 1.30.45 PMSure, the oil markets have responded to the OPEC and Non-OPEC agreement to cut production. But perhaps not quite like the cartel anticipated!

While media headlines are chock-full of reports that parties to the agreement are complying with the cuts, this time it’s different.

And that’s because they’ve underestimated the supply coming out of a new swing producer: The United States.

And that’s going to drive oil prices down in a big way. Consider …

<1> Cumbersome U.S. inventory and surging production. U.S. oil inventories are at their highest seasonal level in 30 years and production is running at its fastest clip in nine months.

And I think this is just the start. Especially on a surge in U.S. oil drilling rig activity, which last week saw the biggest one-week jump in nearly four years.

<2> Surge in corporate spending and oil-patch investment. A recent poll of more than a dozen U.S. players showed an average 60% increase in capital expenditures for oil exploration and production planned for this year! This view was echoed by global investment bank Barclay’s calling for a 50% increase in American E&P spending.

There’s also a flurry of investment activity in the shale-rich Permian Basin.

And don’t forget: U.S. drillers have become nimble and well-funded with some shale producers generating a handsome profit at $45 per barrel. When they’re making money like that, the last thing on their minds is cutting production.



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Bonds & Interest Rates

2017’s Real Milestone (Or Why Interest Rates Can Never Go Back To Normal)

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Posted by John Rubino - DollarCollapse.com

on Wednesday, 25 January 2017 08:01

Forget about NAFTA or OPEC or TPP or crowd size or hand size or any other acronym or stat or concept that obsesses the financial press these days. Only two numbers actually matter.

The first is $20 trillion, which is the level the US federal debt will exceed sometime around June of this year. Here’s the current total as measured by the US Debt Clock:

Debt-clock-Jan-17-2

To put $20 trillion into perspective, it’s about $160,000 per US taxpayer, and exists in addition to the mortgage, credit card, auto, and student debt that our hypothetical taxpayer probably carries. It is in short, way too much for the average wage slave to manage without some kind of existential crisis.

It’s also way more than it used to be. During his tenure, president George W. Bush (2000 – 2008) nearly doubled the government’s debt, which is to say his administration borrowed as much as all its predecessors from Washington through Clinton combined. At the time this seemed like a never-to-be-duplicated feat of governmental profligacy. But the very next administration topped it, taking the federal debt from $10 trillion to the soon-to-be-achieved $20 trillion. And the incoming administration apparently sees no problem with continuing the pattern.



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Bonds & Interest Rates

Bill Gross: Bond Fundamentals Confusing

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Posted by Bil Gross - Janus Capital Group

on Thursday, 19 January 2017 06:52

"Happiness has dominated risk markets since early November and despair has characterized global bond markets."

"For 10-year Treasuries, a multiple of influences obscure a rational conclusion that yields must inevitably move higher during Trump's first year in office. When the fundamentals are confusing, however, technical indicators may come to the rescue and it's there where a super three decade downward sloping trend line for 10-year yields could be critical. Shown in the chart below, it's obvious to most observers that 10-year yields have been moving downward since their secular peak in the early 1980s, and at a rather linear rate. 30 basis point declines on average for the past 30 years have lowered the 10-year from 10% in 1987 to the current 2.40%."

USGG10YR-Index Graph

...reading Bill Gross Investment Outlook January 2017

 



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Bonds & Interest Rates

At beginning of 'long bear market in bonds...

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Posted by Bill Miller via MarketWatch

on Thursday, 19 January 2017 06:32

Screen Shot 2017-01-19 at 6.38.02 AM... which should help banks, investor Bill Miller says.

The bull market in bonds is over and that should benefit financials, legendary investor Bill Miller told CNBC on Wednesday. 

"We're at the beginning of a long bear market in bonds that will last for who knows how long," he said in an interview with "Closing Bell."

.... continue reading/listening HERE

...related:

The 2017 Bond Strategy Backed By Goldman and BlackRock



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Bonds & Interest Rates

The Global War on Cash

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Posted by Visual Capitalist

on Wednesday, 18 January 2017 11:52

Screen Shot 2017-01-18 at 10.37.10 AM

All around the world, lawmakers are making an urgent push to eliminate the use of physical cash.

It's not only the recent demonetization in India - it's also the Western nations that want to eliminate big denomination bills, including the U.S. and Europe.

See who declared war - and who is going to get caught in the crossfire - in today's "can't miss" infographic for The Money Project.

Screen Shot 2017-01-18 at 10.36.14 AM

....also from Martin Armstrong:

The War on Cash – One Giant Leap Forward For Government



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