{"id":3760,"date":"2011-03-11T05:17:43","date_gmt":"2011-03-11T12:17:43","guid":{"rendered":"http:\/\/www.jasonapollovoss.local\/?p=3760"},"modified":"2018-09-21T02:07:58","modified_gmt":"2018-09-21T06:07:58","slug":"oil-discomfort-is-overblown","status":"publish","type":"post","link":"https:\/\/jasonapollovoss.com\/web\/2011\/03\/11\/oil-discomfort-is-overblown\/","title":{"rendered":"Oil Discomfort is Overblown"},"content":{"rendered":"

Stock market investors are very nervous about the Middle Eastern unrest predominately because of fears about disruptions to oil supplies.\u00a0 The panicked opinion obsesses about the possibility for a double-dip recession.\u00a0 Blah, blah, blah.<\/span><\/p>\n

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I consider this possibility to be almost impossible.\u00a0 The reason is that the most important thing to focus on is not the overall level of oil prices, but the marginal increase in oil prices, and their affect on individuals’ and businesses’ profitability.\u00a0 Resident in the collective consciousness of folks at the top of the power food chain is the oil embargo and commensurate recession of 1973-1974.\u00a0 Back then the United States’ economy (hell, most economies were) was based on machine-intensive manufacturing.\u00a0 So oil was very, very, very important to overall economic stability.<\/span><\/p>\n

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Right now economic growth in the First World is being overwhelmingly driven by innovative ideas and people well skilled in deploying those ideas throughout other businesses (think: consulting, software platforms, server farms, etc.).\u00a0 Oil is a much less important resource to economic stability now than it was almost 40 years ago.<\/strong><\/span><\/p>\n

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Had this shock to energy prices happened even 18 months ago it would have derailed the economic recovery.\u00a0 Right now, it’s my opinion that speculators are manipulating commodities markets and certain momentum-type stock market participants do what they always do when they get a whiff of smoke: they yell FIRE!<\/span><\/p>\n

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In short, I would buy on dips.\u00a0 The economic recovery in North America is SOLID.\u00a0 Who should be afraid?\u00a0 The Europeans; who can’t seem to generate much innovation or economic growth.\u00a0 The Chinese, who already have massive inflation to contend with and do not need increased oil prices pumped through their manufacturing intensive economy.\u00a0 But what will happen?<\/span><\/p>\n

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What will happen is that the perception of the “new radically changed reality” will be seen to be a blip in oil supplies and the panic will subside and those looking for the sky to fall will move on to the next fear-inducing news event.\u00a0 What goes on in Libya can be managed by other oil-producing nations.\u00a0 What is going on in Libya is not a permanent state of affairs.\u00a0 Whomever wins Libya, Ghadaffi and his supporters, or the rebels, will be in the business of selling oil.\u00a0 Whomever wins Saudi Arabia (if it should even come close to going that far) will be in the business of selling oil.\u00a0 Any disruptions are, at most, 5-6 months in the making.\u00a0 Much more likely is that disruptions are in the range of 1-2 weeks.<\/span><\/p>\n

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How can I say this so confidently?\u00a0 Because other than oil, why would anyone want to be in power in these countries?\u00a0 Exactly.<\/span><\/p>\n

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I recommend strongly, buying the market on any dips that take the DJIA below 12,000 points.<\/span><\/p>\n

 <\/p>\n

Jason<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Stock market investors are very nervous about the Middle Eastern unrest predominately because of fears about disruptions to oil supplies.\u00a0 The panicked opinion obsesses about the possibility for a double-dip recession.\u00a0 Blah, blah, blah.   I consider this possibility to be almost impossible.\u00a0 The reason is that the most important thing to focus on is […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[3],"tags":[],"class_list":["post-3760","post","type-post","status-publish","format-standard","hentry","category-the-blog"],"_links":{"self":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts\/3760","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/comments?post=3760"}],"version-history":[{"count":0,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts\/3760\/revisions"}],"wp:attachment":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/media?parent=3760"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/categories?post=3760"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/tags?post=3760"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}