EconMatters's blog

Depending upon the time frame natural gas is either in a distinct downtrend channel or a parallel trading range. 

Whether it is the price of a car, a new house, the price of gasoline, a movie ticket, or a good stock there is going to be more money created each year chasing these assets in the system. 

That`s all I heard for two straight months, “Gee everyone is waiting for a pullback to get in on the rally”.

Well Gold hasn`t had a particularly good start to the year, in fact, a good pairs trade would be going long the S&P 500 and short the Gold market for a nice 12% return in two months.

Hence the cost basis of their investments is much higher with each artificial liquidity injection. This is great for current retirees, but at the expense of future retirees who now have inflated assets that will deflate once the Fed takes away the proverbial punch bowl. 

But if we examine the history of lumber prices relative to the strength of the housing sector, lumber prices may be getting slightly ahead of themselves from a valuation standpoint. 

There are just too many variables, too much information, and even unknown variables that play into market dynamics. 

There was corn planted in makeshift small lots, open fields, small farms, and bigger farms. 

This is why before and during almost any major up move in markets traders go to the EUR/USD and USD/JPY funding crosses for the juice to propel the move. It all starts with the juice, that is what determines price in markets. 

We have gone from a supply and demand market to a funds flow market and this really sucks for consumers. 

Now that Enterprise Products Partners LLP has let the cat out of the bag that less than a month after expanding the Seaway pipeline capacity to 400,000 barrels per day, The Jones Creek terminal has storage capacity of 2.6 million barrels, and it is basically maxed out in available storage. 

The first two months of the year have seen volatility crushed downward in this two month bullish rally in assets as new money came rushing into markets needing to get off to a positive start for the year. 

It seems that to exclusively focus on one side of the equation can be human nature at times, and with regard to inflation concerns humans never see the other side of the equation, i.e., areas where they are actually experiencing deflation in their lives.