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Brent Passes $110

Tyler Durden's picture





 

A $10 move in a week is just what the doctor ordered to destroy the last trace of surreality in the whole "economic recovery" story. At this rate we will take out all time high crude prices by mid March. As we have been saying since December, a rapid move in oil will undo years of carefully planned propaganda and money printing. Yet the weakness that "nobody could have possibly predicted" is just as we had forecast: global and US weakness in late February/March, market swoons in March/April (as per DeMark's repeat appearance), Fed releases early indications of QE3 in May. In the meantime, we also get a war as a bonus to boost the US military-defense industrial complex. Pretty much a rerun of the first great depression to the dot.

 


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Wed, 02/23/2011 - 11:21 | Link to Comment tmosley
tmosley's picture

Weird correlation.  Silver is also up 10% over the same time period.

Wed, 02/23/2011 - 11:41 | Link to Comment Cindy_Dies_In_T...
Cindy_Dies_In_The_End's picture

Ah, the sweet smell of irony. Ben totally completes the circle of life here didn't he?

 

 

(Okay, I could have said something more dirty than circle of life)

Wed, 02/23/2011 - 11:45 | Link to Comment MarketTruth
MarketTruth's picture

A circle? Ben? Oh, you mean Ben Shalom Bukkake.

Wed, 02/23/2011 - 12:17 | Link to Comment Calculated_Risk
Calculated_Risk's picture

"completes the circle of the toilet bowl"

ftfy

Wed, 02/23/2011 - 12:05 | Link to Comment tmosley
tmosley's picture

Ok, I looked back, and there's not really that much of a correlation.  Silver has clearly been kicking oil's butt.  At least, WTI's butt.  Can't seem to get Brent to display on stockcharts.

http://stockcharts.com/h-sc/ui?s=$silver:$wtic

 

Wed, 02/23/2011 - 11:22 | Link to Comment Xibalba
Xibalba's picture

Silver and Gold! 

Wed, 02/23/2011 - 11:27 | Link to Comment nontaxpayer
nontaxpayer's picture

And oil!

Wed, 02/23/2011 - 11:30 | Link to Comment snowball777
snowball777's picture

Oh my!

Wed, 02/23/2011 - 11:42 | Link to Comment UnRealized Reality
UnRealized Reality's picture

+++1939

Wed, 02/23/2011 - 11:32 | Link to Comment Cash_is_Trash
Cash_is_Trash's picture

Tungsten!

Wed, 02/23/2011 - 11:34 | Link to Comment UninterestedObserver
UninterestedObserver's picture

Silver and Gold flying, copper going down - I wonder how JPM is doing?

Wed, 02/23/2011 - 11:23 | Link to Comment MsCreant
MsCreant's picture

Gold looking interesting too.

Wed, 02/23/2011 - 11:59 | Link to Comment jus_lite_reading
jus_lite_reading's picture

Dr. Deficit is working overtime these days. The destruction of the entire financial system could occur from a single natural disaster. That is how close we are.

Wed, 02/23/2011 - 12:52 | Link to Comment VegasBD
VegasBD's picture

Yea, good point. =\

Wed, 02/23/2011 - 11:24 | Link to Comment SpeakerFTD
SpeakerFTD's picture

Sweet.  I await Lazlo Birinyi's forecast on Brent.  

Wed, 02/23/2011 - 11:24 | Link to Comment iDealMeat
iDealMeat's picture

OT:  Guess who's mayor of Chicago....  

expected..

 

 

Wed, 02/23/2011 - 11:26 | Link to Comment sudzee
sudzee's picture

Gov't may have to issue oil stamps to augment food stamps.  

Wed, 02/23/2011 - 11:33 | Link to Comment Rainman
Rainman's picture

GAPS and SNAPS...got a nice ring to it.

Wed, 02/23/2011 - 11:28 | Link to Comment RobotTrader
RobotTrader's picture

I'm gonna be screwed this summer....

I should have bought double the shares in UGA, but I waffled and missed out.

LOL....

Wed, 02/23/2011 - 11:29 | Link to Comment Internet Tough Guy
Internet Tough Guy's picture

A clueless classic from the master trader himself:

Crude Oil might have topped out tonight
RobotTrader - Mon, Feb 21, 2011 - 09:18 PM

Nice reversal, looks like crashing equity markets are now factoring plummeting demand.

Wed, 02/23/2011 - 11:34 | Link to Comment taraxias
taraxias's picture

++++

Wed, 02/23/2011 - 11:35 | Link to Comment UninterestedObserver
UninterestedObserver's picture

ouch

Wed, 02/23/2011 - 11:49 | Link to Comment lieutenantjohnchard
lieutenantjohnchard's picture

eight ball in the side pocket. rack `em! excellent, itg.

Wed, 02/23/2011 - 12:56 | Link to Comment VegasBD
VegasBD's picture

Someone say 8ball? Good idea. Better call that in before the weekend.

Wed, 02/23/2011 - 11:32 | Link to Comment tmosley
tmosley's picture

Shoulda got a real job.  Maybe then you wouldn't have bankrupted yourself six times in the last five years.

Wed, 02/23/2011 - 11:34 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

Always buy out of money crude calls for summer driving season... guaranteed to make you some bucks some of the time.

Wed, 02/23/2011 - 11:38 | Link to Comment lieutenantjohnchard
lieutenantjohnchard's picture

as mentioned many times the old catfish mouth doesn't even take his own advice so why should anybody else. meanwhile, as the catfish mouth would say, oil, gold and silver are rising quite nicely, the opposite of what the catfish mouth said would happen.

btw: are we fighting the fed city hall today trying to pick a top, as you mentioned yesterday? or has that codicil been rescinded for today, or at least until the wind changes?

ps: the old scroomer, as you call him, gentleman jim sinclair sends his regards.

btw: i notice that egypt is still on the front pages a month after the fortnight you said it would gone. any other predictions i can fade today?

Wed, 02/23/2011 - 11:59 | Link to Comment Cindy_Dies_In_T...
Cindy_Dies_In_The_End's picture

Robot! Say it isn't so! You know Summer is all Hamptons, all the time. How will we ever BBQ without you!

 

Hookers in the city during the summer is so 1990.

Wed, 02/23/2011 - 11:28 | Link to Comment HedgeFundLIVE
HedgeFundLIVE's picture

DBO- an oil ETF that has been on a roll, has low correlation to an unpredictable market = good for hedging purposes. thoughts?:

http://www.hedgefundlive.com/blog/ways-to-hedge-a-market-that-depends-on-the-actions-of-crazy-people

Wed, 02/23/2011 - 11:28 | Link to Comment slackrabbit
slackrabbit's picture

Is it a bird?

Is it a plane?

No, its fleet of black swans, and the f***ers are about to s**t all over us!

 

Wed, 02/23/2011 - 11:49 | Link to Comment Aquiloaster
Aquiloaster's picture

I'm not sure I would necessarily call it a black swan (an unexpected extreme outlier that, in all, plays a larger role than regular occurances). If Tyler predicted it, I think that from the point of view of ZHers, it cannot be. Every major event is not a black swan.

Wed, 02/23/2011 - 11:54 | Link to Comment UninterestedObserver
UninterestedObserver's picture

? isn't that the definition of a black swan - major market moving event that wasn't predicted

Wed, 02/23/2011 - 12:29 | Link to Comment Aquiloaster
Aquiloaster's picture

My point with that comment was the Tyler predicted it. Therefore not a black swan. If President Obama asked for a task force to assess stability in the middle east, he was not surprised either. In addition, bloggers such as Charles Hugh Smith, James Kunslter etc. also stated in late December/early January that the middle east was going to descend into violence which would destablize the recovery. The long and short of my comment is that enough people saw this coming to consider it predictable.

Wed, 02/23/2011 - 11:52 | Link to Comment tmosley
tmosley's picture

Then we shall count our silver in the shade!

Wed, 02/23/2011 - 11:29 | Link to Comment Zero Debt
Zero Debt's picture

Now if there's a gold:oil ratio and a gold:silver ratio, isn't there a oil:silver ratio?

Wed, 02/23/2011 - 11:30 | Link to Comment Temporalist
Temporalist's picture

Gold just shot straight up. 

Wed, 02/23/2011 - 11:32 | Link to Comment nontaxpayer
nontaxpayer's picture

Silver too!

Wed, 02/23/2011 - 11:31 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

Gad-off-ee... should I stay or should I go... The Clash

Wed, 02/23/2011 - 11:33 | Link to Comment SheepDog-One
SheepDog-One's picture

Rock the Casbah!

Wed, 02/23/2011 - 11:39 | Link to Comment snowball777
snowball777's picture

As soon as the shareef was
Chauffeured outta there
The jet pilots tuned to
The cockpit radio blare

As soon as the shareef was
Outta their hair
The jet pilots wailed

Wed, 02/23/2011 - 11:35 | Link to Comment Dick Darlington
Dick Darlington's picture

Tyler, You forgot one thing. JCT hiking rates just before the wheels come off.

Wed, 02/23/2011 - 11:34 | Link to Comment Sutton
Sutton's picture

George Melloan in WSJ op-ed blames Ben B for the turmoil in the  Islamshittistans .

Tyler was way ahead.

Wed, 02/23/2011 - 11:40 | Link to Comment earnyermoney
earnyermoney's picture

Actually, let's give credit where credit is due. Bruce K. called this a month ago.

Wed, 02/23/2011 - 11:54 | Link to Comment Tyler Durden
Tyler Durden's picture

Our first note that Bernanke will be responsible for global genocide in October 2010 was not met too favorably.

Wed, 02/23/2011 - 11:59 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

I recall that one... I knew he would print, what I did not know, and found very had to believe when others were saying it, was just how much Ben would print.

I suppose that I thought his 'helicopter speech' was simply more jawboning. Boy, was I wrong about that one!

Wed, 02/23/2011 - 12:06 | Link to Comment CrashisOptimistic
CrashisOptimistic's picture

Altogether way too glib a presumption that Bernanke is the cause of oil price rise.

Yes, it is red meat to the folks that generate click revenue here, but reality is rather more important than that.

North Sea oil production (Brent) has been in freefall for a decade now.

Wed, 02/23/2011 - 12:15 | Link to Comment tmosley
tmosley's picture

Blah blah blah.  Just keep ignoring the facts.

If oil supply were the issue, oil would have lead everything else up in price.  It hasn't, so shut up with the peak oil crap.  We can cross that bridge if we make it that far.

Wed, 02/23/2011 - 12:26 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

Oil is settled almost exclusively in dollars and now there are lots more dollars available for settlement/speculation...my shorthand is 'too much slosh in the system'.

Who is to be faulted for the slosh?

Granted, Brent is in decline, Cantarell is in decline, Venesuela is probably in decline except the asphalt reserves...and, BP is a disaster waiting for another opportunity, and some others.

I was a regular at 'The Oil Drum' when crude shot up to ~ $147... On that board everyone was screaming 'this is it!, it's Peak Oil, and the price is only going up from here!' I said 'bs, the Persian Gulf is full of tankers loaded with Iranian Crude and there is NO market to sell to.' SA was also saying they were making more crude available than the market wanted to buy. Naturally I was booed. I shorted oil and made a tidy sum. When it hit $121 on the way down I cashed out my winnings. I gave a blow by blow account to the Oil Drum of what I was doing, and why. I received another round of boos. I laughed all the way to my gold dealer.

So, what is to be learned from of all this... Not every run up in any commodity is driven by shortage. Occasionally there is too much slosh looking for higher returns and when ROI is not available in the normal markets lots of money piles into commodities. The fact that shortages do exist, some due to potential shut in production, weather, etc, isn't helping either.

Maybe we are seeing the perfect storm. No way I am short crude now!

 

Wed, 02/23/2011 - 13:40 | Link to Comment CrashisOptimistic
CrashisOptimistic's picture

 

You do not understand the problem.  This is not about trading.  Price is not informative about this matter when so much China supply is in non public contracts.

The New Normal is precisely that.  No past lessons were lessons.  There is no history to learn from because this world never existed before.

Wed, 02/23/2011 - 11:35 | Link to Comment topcallingtroll
topcallingtroll's picture

Spxu

The triple short etf.

Come on Ghadafi....stay in the game....

Wed, 02/23/2011 - 11:40 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

US to enforce no-fly zone over Ga-da-fee-stan... details at 11... with pictures!

Wed, 02/23/2011 - 11:45 | Link to Comment topcallingtroll
topcallingtroll's picture

Dangit! That's no fair!

Wed, 02/23/2011 - 11:47 | Link to Comment I Am The Unknow...
I Am The Unknown Comic's picture

This should be no suprise to anyone...after all The Bernanke told us clearly that he is an "expert" on the Great Depression.  He did NOT say that he had learned anything from it, or had anything to add or to do better this time.  No, he did not.  Instead he has stated clearly that he has got this whole Great Depression thing down to a science. 

Expect hyperinflation, war, and rationing.  Scarcity of resources is the plot of the greedy.

Upcoming headlines:

War Bonds to replace Build America Bonds program!

Pennies To Be Made With Tin Instead Of Copper (it happened in 1943)! 

Save A Soldier - Recycle and Give Blood!

Report Suspicious Neighbors....oh wait, that's already here....

5 More Sullivan Brothers Die As Navy War Heroes - Mother Asks "Why Us Again? (Then Curses Banksters)"

Wed, 02/23/2011 - 12:09 | Link to Comment Dantzler
Dantzler's picture

Copper has been mostly gone from US pennies since 1982.

And they were steel, not tin in 1943.

I got the gist though...

Wed, 02/23/2011 - 13:35 | Link to Comment I Am The Unknow...
I Am The Unknown Comic's picture

yes, I stand corrected on both....and I did know better so it's my own fault....just got caught up in the moment.

Wed, 02/23/2011 - 14:07 | Link to Comment r101958
r101958's picture

One thing Ben forgot to consider when he was determining a course of action. The U.S. is not in the same financial/resource position that it was in during the 1930's. We are no longer an oil exporter nor are we anywhere near being the biggest oil producer. Our financial situation is much different now. We have huge amounts of public and private debt now and didn't in the 30's. Those are just a couple of differences but the list is quite long.  

Wed, 02/23/2011 - 11:48 | Link to Comment scratch_and_sniff
scratch_and_sniff's picture

This move is blowing me away, a little freaked out by whats brewing tbh.

Wed, 02/23/2011 - 11:50 | Link to Comment Ethics Gradient
Ethics Gradient's picture

Is there any irony in that Greeks are now hurling ever more expensive oil based produce onto their police in a protest regarding austerity?

http://www.telegraph.co.uk/news/picturegalleries/worldnews/8343215/Riot-police-and-photographer-on-fire-after-petrol-bombs-thrown-in-Athens-during-general-strike.html

Wed, 02/23/2011 - 14:36 | Link to Comment andybev01
andybev01's picture

Maybe they're saving money by using ethanol...

Wed, 02/23/2011 - 22:05 | Link to Comment StychoKiller
StychoKiller's picture

You can't drink ethanol...oh wait. :>D

Wed, 02/23/2011 - 11:49 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

It must be offical cause FORBES said so... 'Higher Inflation Is On The Way'

Plus a bonus photo of Ben demonstrating how long his weeny is... not very.

See it all here...

http://blogs.forbes.com/charleskadlec/2011/02/22/higher-inflation-is-on-the-way/

Wed, 02/23/2011 - 11:51 | Link to Comment GOSPLAN HERO
GOSPLAN HERO's picture

Comrades,

Silver is your best bet!

 

Wed, 02/23/2011 - 11:55 | Link to Comment falak pema
falak pema's picture

If he stays... the tap stays open...if he goes...the tap closes...oil spot explodes like geyser...and the sheikh of Saud will have more holes in his belly than gruyere cheese..as all commodities will rocket like throb titty of a rogue she-camel who needs dicky like no one this side of the parched empty quarter. What a night-mare for Benocide who must need a shag like no other lonely camel in the Sahara. It's a lonelier world in the ivory tower of DC pillared oracle temple than in the empty quarter of the Rub al Khali.

Wed, 02/23/2011 - 12:11 | Link to Comment Oh regional Indian
Oh regional Indian's picture

falak, you write really well. Very visual and evocative. Fuller length posts from you and Slewie the Pi Rat would be welcome.

And Brrrrrent. Cold snap coming to Europe (Piers Corbyn) and Italy in Nat Gas supply trouble. Double trouble.

More sure than ever this will end badly for the Vatican....

ORI

http://aadivaahan.wordpress.com/2011/02/23/ihumor-for-un-funny-days/

Wed, 02/23/2011 - 13:00 | Link to Comment falak pema
falak pema's picture

Thanks ORI,

But while we are doing hat tipping to contributors let me make my humble bow to those who have animated this forum since I've joined it :

Tyler Durden's letter to Benocide is a masterpiece of clarity and intensity. I loved it like all he has to say.

GW 's honest portrayal of political choices and logical, factual inputs is so rare in a society that's fallen into limbo since that day and age when a man said : The torch has now been handed to a new generation...we know the sequel only too well... It's time to relight that torch  as crass materialism and political hubris is not the solution.

WB7's pictorial genius is like Picasso in wonderland! 

Many, many more intelligent contributors. As a foreign element I feel like an ice skater in Central Park or Rockefeller center enjoying the ride!

More seriously in these troubled times, this ZH forum feels like the conclave of the 300 as they wait at Thermopylae the invader. Long live the legend of King Leonidas!

I appreciate your comment. I hope to keep contributing in my own impenitent, sincere  way. I lack your wisdom. Please accept my irrepressible desire for lightness in the pursuit of enlightenment.

 

Wed, 02/23/2011 - 16:03 | Link to Comment Oh regional Indian
Oh regional Indian's picture

Thanks for the response. your brand of lightness is good medicine.

ORI

Wed, 02/23/2011 - 11:58 | Link to Comment brunoaa
brunoaa's picture

An exploding  combination of surging oil prices and abundant liquidity... welcome back to the seventies... stagflation here we come!!!

Wed, 02/23/2011 - 11:57 | Link to Comment props2009
props2009's picture

EU yields are flying. 2 Year at 1.5%. EUR/USD responding. takes out 1.3755.

Where are the @#$@ jokers here who said EURO was going to 1.1

http://dawnwires.com/investment-news/eu-yields-rising-and-indicating-but...

Wed, 02/23/2011 - 12:06 | Link to Comment scratch_and_sniff
scratch_and_sniff's picture

Its wasn't a wild call by any standards... anyway, its only february. (for the record i made no such call)

Wed, 02/23/2011 - 12:04 | Link to Comment ak_khanna
ak_khanna's picture

The stock, commodity and currency exchanges have been reduced to gambling dens whereby the more powerful traders with deep pockets move the markets to maximize their own profits at the expense of the remaining not so powerful players. The big boys have enormous money power to move the markets in the direction which results in maximum profits for themselves. They effectively use the media to lure the other players in the market to a position where they would incur maximum loss.

The markets will fall only when the banksters have eliminated all the short positions and only they themselves have positioned themselves to profit when the market falls
OR
When an unexpected world event catches the banksters with their pants down and the softwares they use to rig the markets go berserk beyond their control.

http://www.marketoracle.co.uk/Article24581.html

Wed, 02/23/2011 - 12:10 | Link to Comment Dr. Porkchop
Dr. Porkchop's picture

Rising oil prices are an indication of a recovering economy!

Wed, 02/23/2011 - 12:30 | Link to Comment Atomizer
Atomizer's picture

Rising oil prices are an indication of a recovering economy!

 

Nancy Pelosi says, “Unemployment checks are the fastest way to create jobs.”

Your comment is pure comedy!

Wed, 02/23/2011 - 12:09 | Link to Comment trav7777
trav7777's picture

maybe IEA wasn't lying when they said peak was in the rearview mirror

Wed, 02/23/2011 - 12:24 | Link to Comment slow_roast
slow_roast's picture

robotarded

Wed, 02/23/2011 - 12:33 | Link to Comment ArkOmen1
ArkOmen1's picture

Um... anybody see this?

 

http://www.debka.com/article/20692/

 

 

 

USS Enterprise parked opposite Iranian flotilla at Suez Canal entrance

Wed, 02/23/2011 - 13:04 | Link to Comment Sizzurp
Sizzurp's picture

Welcome to post peak collapse.  GDP growth without growth in oil production is impossible.  Any growth we experience will be nominal only as the Fed and central banks create the illusion of growth with money printing.  As the real economy gets a little steam going, the price of oil will rise until we fall back down into endless waves of ever worsening recession.  Unfortunately, we are likely to have more problems than just rising oil prices.  Civil unrest, massive food inflation and wars will be bigger issues as basic survival becomes more of a challenge.  Carrying capacity of the planet is being reduced along with availabilty of cheap energy.  Peak oil equals peak population. Given the fact that we are currently witnessing these types of problems at the very beginning of post peak collapse, I shudder to think what things will be like as production declines really start to accelerate in coming years.

Wed, 02/23/2011 - 13:38 | Link to Comment RmcAZ
RmcAZ's picture

Do we have $112? Yes I think so... prices going parabolic just like on Monday.

Wed, 02/23/2011 - 15:12 | Link to Comment FrankIvy
FrankIvy's picture

Your free awesome thought for the day:

The last 100 years of "prosperity" have been nothing more than man's converting stored energy (coal, oil, NG) into work.  The standard of living of your average 1900-2010 man that exceeded the SOL of men before the oil age is directly and virtually solely attributable to converting the energy in oil into useful product.  This means that the rise in GDP per capita was not so much dependent on technology as it was dependent on the cheap energy that fueled that technology.  The technology that led to modern excavators didn't allow the digging production of one man to be multiplied by 500 - the diesel did, and if you don't believe that, wait until the diesel's gone and see whether the man digs with a shovel or runs the excavator with technology.

Conclusion: this has all been just a blip in the history of humans.  A wonderful, temporary period of one-time expansion allowed by stored energy.

Final Conclusion - GDP per capita was 400 bucks at the time of Jesus and was 400 bucks at the time of Mohamed and 400 bucks just before George Orwell arrived on scene.  GDP per capita is now thousands of dollars and falling.

Conclusion that you can only understand if you understand the criticality of oil to everything in your life, including the web page you're looking at - in the not too distant future (decades at most), per capita GDP will again be, in real terms, 400  bucks per person.  Amen.

Thu, 02/24/2011 - 04:15 | Link to Comment techperson
techperson's picture

He'll run the excavator with technology.  Locomotive-size electric motors and batteries charged by PV.  Electricity produces the most torque at the lowest speed.  Excavator is a great application.  So is a farm tractor.  (I am converting a 1953 Allis-Chalmers G cultivating tractor to electric power.)

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