..why is oil 50+/barrel? apart from currency weakness. Who has the most to gain.
..looking at what has happened since the Bush administration came to office:
1) increased spending - military deployments - long term commitments - reactionary policies ie afghanistan, iraq
2) tax cuts
..Does the oil industry benefit from 50+, does the military benefit from a reactionary terrorist policy. Does the Russian economy benefit with state oil industry increasing production. Yeah there was a tax cut but it would seem if oil stays at this price range. We literally fed the oil producers our tax savings. Is there a supply/demand adjustment going on in the world. Do the new economies that are coming online have a sharp increase in demand for oil, ie China, India, it doesn't seem so. All those outsourced back office's in India don't explain 50+ price. The Chinese economic output didn't increase sharply to explain 50+ either.
It just doesn't seem there is a good enough explanation from the evidence around to justify a 50+ barrel. It seems it will stay in this price range as long as we are in the middle east.
The administration inherited a terrorist, economic crisis. Lot of conspiracy theories abound that we looked the other way for such events to unfold, so that Bush would have a clear polarized world to walk through. When Bush came into office remember the 'malaise' in the air. The smell of death for the new administration was so rampant. How convenient was it for them to have events play out as they did. With Sharon's primary goal to release a rabid dog onto the middle east, with the ultimate goal of eliminating a clandestine nuclear threat from Iran.
What does the future hold for us now? How long will we be in the middle east? Why are we there in the first place? Are we positioning ourselves for a unseen threat in the future. What or who is that threat? Will the europeans sit comfortably around without making serious economic commitments as their currencies fluctuate up. With short term reversals in trends. Where is this country headed for the next 4 years?
It would seem consolidation is the key. US will be in the region for quite some time. The longer we are there without gaining the hearts and souls of the people, the more we breed terrorists and hate. Most of the regional conflicts seem to be on the ice at the moment.
China/Tiawan India/Pakistan North/South Korea
It would seem the risk is higher that a Russian city goes up in a mushroom cloud than a US city, with the fanatical Chechnian terrorists.
With the current administration, it would seem wise to bet against the dollar for the next four year with short term reversals here and there. Equities are in a long term up cycle. With yields and inflation to head up.
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