Replies to post #310693 on Zeev's Turnips Patch-No Politics (ZEEV)

[gottfried]

Joe, it's not just you two. Count me in. Do the transports predict oil price? Since August they seem to expect oil to go lower.

Gottfried

[KyrosL]

The transports are dominated by railroads, deliverers and transport service specialists. You can argue that they all benefit from high oil prices. The airlines have been beaten down to bankruptcy prices long ago and are no longer relevant.

[skono4]

More and more of our merchandise is going to be manufactured and transported from the other side of the world, as far away from lawyers and unions as possible. Whatever the increase in fuel costs is more than offset by the savings in wages, benefits, worker's comp insurance, labor law compliance, litigation and taxes. Let's face it. You can scour the globe for the lowest price and lowest standards and cough up the extra few buck per ton to account for fuel. Demand for crude oil, trucking and railroads is only going up unless there is some kind of global recession or we stop buying cheap crap from Walmart.

[basserdan]

Is it just me and the guy that posted these charts that think something ain't quite right.
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Hi Joe,
Veddy Strange indeed..... Unless we blame the PPT or what ever the hell their name might be these days. One thing is highly probable however, and imo, and that is that the tradings desks of JPM and the other bankster cohorts who work hand in hand with the Treasury/AG and his Merry men colossus are prolly raking in bucks by the truckload during this trucking rally. <g>

Here's an interesting perspective from Mike Bolser @ LeMetropole Cafe.

Much has been made by Richard Russell and others regarding the odd rise of the DOW transport index (DTX) at a time of skyrocketing fuel prices and a flat DOW.

I normalized the DTX historical data (Placed on the right axis now with the DOW), inserted a 30-day moving average (Blue) and compared the Repo Pool's red 30-day moving average with the DTX.



You be the judge if there are similar patterns in the moving average of the Repo Pool and the DTX. Indeed, examine the slight lag in the pool's 30-day ma and the DTX ma in December, however today with a far larger and more robust pool size the reaction time between the pool and the DTX is now without delay.

I think this may explain why the DTX is rising at a time when by all logic it should be falling.

If you're interested, Mike has his own website:

http://www.interventionalanalysis.com.