SHOULD WE WORRY ABOUT THE PRICE OF OIL?
GS looking for a super-spike in oil, to $150-200/barrel over the next 6-18 months.
The consumer is toast, with more and more discretionary funds going toward energy use. That means less for almost everything else.
The equity market does not come close to reflect the energy pricing structure. Why? The belief is we have passed the worst case for financials (debatable) and energy pricing will abate with the domestic and eventual global slowdown (which many people still refuse to consider).
My bottom line: The market has more risk in the second half of the year than the consensus opinion. Watch the SPX 1350-1375 level as critical to judge the near-term trend, which is up but weakening as crude breaks to new highs every day.
3 years ago • Notes