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"Stocks in the Spotlight"
-Futures -
May -- 7 -- 2008
UPDATED WEEKLY
PRECIOUS METALS
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GOLD (CMX) |
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SILVER (CMX) |
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PLATINUM (NYM) |
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| Old Yeller closed at
$885.80, up + 27.80 on
the week and off - 23.20 for May (weekly close). The multi-year "weekly" closing high is $993.80 (3/14/08). The U.S. dollar has continued to set multi-year lows against other currencies with little let up in sight, showing weakness against the metals this past week. Look for the dollar to continue lower over the near term. The Feds continue to tell us they are worried about inflation and recession, and the rule is, once the Feds say they are worried it really means we are in trouble. The out of whack trade and budget deficits and a housing market showing signs of still lower ground ahead, are strong reasons for commodities to keep climbing. The good ole USA is trying to do something about the nationwide housing tumble, but lowering interest rates and bailing out brokers and bankers will not be a solution. Expect the volatility to continue, with a bias to the upside on the metals and continued weakness in the dollar. Precious metals are considered by many countries as safe havens when the world economy has too many problems. As the value of the dollar is questioned many countries and investors buy precious metals. |
CURRENCY
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British Pound |
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Euro |
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Japanese Yen |
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| The pound lost for
week 3 after gaining 1 week after losing 1 week, while the euro
gained gained on the week after losing 3 weeks after gaining
1 week. The yen
gained on the week after losing 1 week after gaining 1 week. The euro has remained over the dollar for 286 straight weeks with the
base near the 121 level, and more recently, the 131 level (center chart above). The euro has been setting all time
highs against the dollar. The dollar is weakening mostly because of very high U.S debt, a weak dollar, turmoil in the housing sector, the ongoing cost of the occupation of Iraq and growing concerns over the increasing signs of a "deep" recession. We will need to watch near term events, interest rates and inflation, in order to get a better idea of what lies ahead, but a "best guess" is the dollar will continue in search of lower ground. It would appear this latest move by Ben and friends, a 1/4 point cut in the Fed Funds rate, following a strong 3/4 point cut in rates in the previous meeting, combined with the $30 billion bailout of his friends, that the Feds' main concern is Wall Street and not the economy. The continued falling rates is driving the dollar to record lows, but the Feds have little concern. Worse yet! The lower rates the banks are receiving have not turned into lower mortgage rates. I guess "greed" is still king. |
OIL - LIGHT CRUDE
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LIGHT CRUDE (NYM) |
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Friday's close (June's futures) is $125.96 a barrel, versus the week before at $116.32, three weeks ago at $118.54 and $116.74 four weeks ago. The record "weekly" closing high is $125.96 a barrel, 5/9/08. The price for a barrel of oil closed
over the $100 mark for the 11th straight week,
Higher oil prices effect the entire world because,
in one way or another, we all use oil
The higher price of oil is one of the strongest single factors that could effect the world economic recovery. We need oil at a much lower level if we want to give any world economic expansion a chance. Crude Oil prices were at a multi-year low of $11.26 a barrel in February of 1999, but surged to over $38 when G.W. Bush was nominated (at the same time) and this was the actual start on the road to over a hundred dollars a barrel. Apparently other counties knew what would happen with GW and his giant oil companies running Washington D.C., and it appears, they were right on target in their foresight. With the Bush administration winning another four years, we can look forward to oil prices staying up for possibly the entire four year period. Keep in mind that the terrorist nations (Saudi Arabia)
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MEMBER LIST |
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J.R. Budke has been a stock broker since 1981, an options principle since 1982 and a branch office manager since 1987. He is currently inactive as a stockbroker as of 12/31/99. J.R. has been writing the articles and opinions for the Stocks in the Spotlight, in conjunction with the editor B.G. Santos, since 1990. The stories and stocks found on this site, or any "Stocks in the spotlight" written material, are the opinions of J.R. Budke unless other wise stated and are opinions only and are not to be construed as advice. You should not purchase any stocks solely on the opinions found on the "Stocks in the Spotlight's" web site or in any of it's written material. You should also be aware that options are not for everybody and carry a high degree of risk. You should always consult with your broker or investment advisor before purchasing any stock. |
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