Crude

The mainspring of Islamic extremism and militancy isn’t the moderate and democratic political Islam, because why would people turn to violence when they can exercise their right to choose their rulers? The mainspring of Islamic militancy is the despotic and militant political Islam of the Gulf variety. The Western powers are fully aware of this fact, then why do they choose to support the same forces that have nurtured jihadism and terroris?

In March 2014 Wall Street’s ex-items S&P 500 earnings forecast for 2015 was about $133 per share; it ended up 20% lower at $106. Yet here they go again - the consensus for 2016 started out at $137 per share last spring, and is just now beginning to make its way back toward the high $120s. It is a barometer of the abject complacency and intellectual sloth that has descended on the casino owing to two decades of Fed coddling and seven year of free money for the carry trades. In the case of Chipotle, it was always just a burrito. In the case of the US and world economy and financial markets, it’s not even that.

While one can never be entirely certain about these things, as they always play out slightly differently, it could well be that the upturn in the Rand gold price and SA gold shares is once again a leading signal for the entire sector. The canary in the gold mine so to speak, only this canary isn’t dying: instead it is a dead canary that is coming back to life.

Free Corzine!!!  Hasn't he already served enough time?

The oil rig count dropped 20 to 516 in the last week - the biggest weekly drop in 4 weeks to new cycle lows. Crude was unimpressed, jumping modestly and then fading...

It's getting worse... faster! These two stunning overnight developments in crude oil prices should shock investors...

"Saudi Aramco confirms that it has been studying various options to allow broad public participation in its equity through the listing in the capital markets of an appropriate percentage of the Company’s shares and/or the listing of a bundle its downstream subsidiaries."

The half-life of the latest "market supporting" intervention by the Chinese government: just about 12 hours.

The problem of reaching limits in a finite world manifests itself in an unexpected way: slowing wage growth for non-elite workers. Lower wages mean that these workers become less able to afford the output of the system. These problems first lead to commodity oversupply and very low commodity prices. Eventually these problems lead to falling asset prices and widespread debt defaults. These problems are the opposite of what many expect, namely oil shortages and high prices. This strange situation exists because the economy is a networked system. Feedback loops in a networked system don’t necessarily work in the way people expect.

"They keep saying things like Mohammed is the prophet. Similar to Bin Laden. They are paving the way for him in North Africa."

Daniel Yergin and other experts say that U.S. tight oil is the swing oil producer of the world. They are wrong. It is preposterous to say that the world’s largest oil importer is also its swing producer. There are two types of oil producers in the world: those who have the will and the means to affect market prices, and those who react to them. In other words, the swing producer and everyone else.

While the "sell in 1973, and go away" plan had worked out for some in the commodity space, the destruction of the last decade has only one historical comparison... the middle of The Great Depression.

Earlier today everything changed when Saudi Arabia's unveiled what may be a stunning Hail Mary: one which is great news for the suddenly liquidity challenged Saudi government, and is very bad news for the future price of oil. According to the Economist, Saudi Arabia is contemplating taking Saudi Aramco - arguably the world's most valuable company - public. Here are the implications.

• Weakness in the Canadian Economy driving its currency lower
• Inverse relationship between commodity prices and USDCAD exchange rate
• Why there could be a reversal in trend

How did the Canadian currency reach a twelve year low?

The US Dollar reached a recent high against CAD at 1.41081 on January 6^th a level not seen since August 2003. The general bull trend the green back has been in picked up momentum since talk begun by the Fed of a return to higher interest rates.

With WTI trading with a $32 handle, collapsing below December 2008's $32.40 lows briefly overnight, OPEC's broad basket price for crude has also reached a worrisome milestone. Amid Saudi price cuts to Europe, the basket price was set at $29.71 today - the first print below $30 since April 2004.