Financial Markets Meltdown

[barsik]

serious situations always separate competent and capable elected officials from idiots, opportunists, and charlatans. so far, I haven't identified anyone who is not from this class although I must say South Korea seems to be minimizing the spread of the virus. I really hope it doesn't mutate into something much more deadly because it sure is communicable.

[Justfishin73]

That 20,000 DOW is looking like a reality now ---last hour today should be brutal

[fishnguy]

Yep. Pretty sure we are looking at another couple thousand day.

[raab]

We may hit the circuit breaker again. Getting close

[raab]

On the good side, with cheap oil, the economy should come roaring back after the corona virus is dealt with. How long that takes is anyone’s guess at this point.

[AndrewM]

Originally Posted by raab

On the good side, with cheap oil, the economy should come roaring back after the corona virus is dealt with. How long that takes is anyone’s guess at this point.

I think oil prices will be back up long before Corona virus is dealt with. Prices will stay low long enough to kill the US shale plays as most were already on the edge of failing. Then it will jump back up. Doubt it will take long with the steep declines and shale needing over 45 to be remotely economic.

[raab]

Originally Posted by AndrewM

I think oil prices will be back up long before Corona virus is dealt with. Prices will stay low long enough to kill the US shale plays as most were already on the edge of failing. Then it will jump back up. Doubt it will take long with the steep declines and shale needing over 45 to be remotely economic.

The last time OPEC and Russia faced off it was a 2 year stand off. No end in sight right now as both boosted production yesterday.

[Justfishin73]

Originally Posted by raab

We may hit the circuit breaker again. Getting close

No, has to be a certain percentage within a time frame--has been sporadic up and down all day

Key Parameters of the Circuit Breaker System
Acceptable up-or-down trading range (9:45 am-3:35 pm)
Acceptable up-or-down trading range (9:30-9:45 am and 3:35-4:00 pm)
Security price, listing
5%
10%
Tier 1 National Market System (NMS) securities: S&P 500- and Russell 1000- listed stocks, some exchange-traded products; price greater than $3.00 (price > $3.00)
10%
20%
Tier 2 NMS securities: other stocks priced over $3.00 (p > $3.00)
20%
40%
Other stocks priced greater than or equal to $0.75 and less than $3.00 ( $0.75 ≤ p ≤ $3.00)
Lesser of 75% or $0.15
Lesser of 150% (upper limit only) or $0.30
Other stocks priced less than $0.75 (p < $0.75)

[AndrewM]

Originally Posted by raab

The last time OPEC and Russia faced off it was a 2 year stand off. No end in sight right now as both boosted production yesterday.

Saudi's cannot sustain low prices or the high rates they are stating they can for very long. Russia hasn't really cut anything over the past few years. I think think this is designed to kill the shale plays and has little to do with competing with each other as neither wants to give their oil away.

[AndrewM]

https://www.marketwatch.com/story/wh...war-2020-03-09

[raab]

Originally Posted by Justfishin73

No, has to be a certain percentage within a time frame--has been sporadic up and down all day

Key Parameters of the Circuit Breaker System
Acceptable up-or-down trading range (9:45 am-3:35 pm)
Acceptable up-or-down trading range (9:30-9:45 am and 3:35-4:00 pm)
Security price, listing
5%
10%
Tier 1 National Market System (NMS) securities: S&P 500- and Russell 1000- listed stocks, some exchange-traded products; price greater than $3.00 (price > $3.00)
10%
20%
Tier 2 NMS securities: other stocks priced over $3.00 (p > $3.00)
20%
40%
Other stocks priced greater than or equal to $0.75 and less than $3.00 ( $0.75 ≤ p ≤ $3.00)
Lesser of 75% or $0.15
Lesser of 150% (upper limit only) or $0.30
Other stocks priced less than $0.75 (p < $0.75)

7% in a day is the number and time range for 15 minute reset. 7% again and another 15 minute reset. If it hits 20% in a day, the market shuts down for the day.

[raab]

Originally Posted by AndrewM

Saudi's cannot sustain low prices or the high rates they are stating they can for very long. Russia hasn't really cut anything over the past few years. I think think this is designed to kill the shale plays and has little to do with competing with each other as neither wants to give their oil away.

You can look at this another way OPEC is an American Ally due to petro dollar. Russia is not. This is a economic war between Putin and Trump. Trump also wants low oil prices. It’ll be here for awhile, and the market is expecting that.

[Deer Hunter]

Originally Posted by AndrewM

https://www.marketwatch.com/story/wh...war-2020-03-09

Even though the US shale guy has more debt, they have a president who respects the business and wouldn't see the entire industry go belly up with out a fight. He will likley offer some sort of bailout financing.

Canadas oil companies on the other hand have no one to help. Our Prime Minister wants to rid the country of oil. And the majority of the people in Canada enjoy cheap fuel even though the entire economy is circling the bowl. Kenny may need to kick in some sort of funding but he really has no money to play with. Let's hope the global supply shrinks quickly due to price and 30$ oil is shortlived, regardless of the corona virus decrease in demand.

[Deer Hunter]

Originally Posted by raab

You can look at this another way OPEC is an American Ally due to petro dollar. Russia is not. This is a economic war between Putin and Trump. Trump also wants low oil prices. It’ll be here for awhile, and the market is expecting that.

I don't think Trump wants 30$ oil. Nor 100$ oil. His economy was doing quite well with 50-60$ oil.

[raab]

Originally Posted by Deer Hunter

I don't think Trump wants 30$ oil. Nor 100$ oil. His economy was doing quite well with 50-60$ oil.

I think Trump wants it as cheap as possible. High oil, makes for a bad economy. Low oil usually improves everything. Alberta it’s different because of our reliance on oil. Most of the industry here is involved in oil one way or another.

[Deer Hunter]

Originally Posted by raab

I think Trump wants it as cheap as possible. High oil, makes for a bad economy. Low oil usually improves everything. Alberta it’s different because of our reliance on oil. Most of the industry here is involved in oil one way or another.

You can't have energy independence and 30$ oil in the same sentence. He doesn't want to be dependent on Middle East oil does he?

[AndrewM]

Originally Posted by Deer Hunter

You can't have energy independence and 30$ oil in the same sentence. He doesn't want to be dependent on Middle East oil does he?

No doubt. lol

[AndrewM]

Originally Posted by Deer Hunter

Even though the US shale guy has more debt, they have a president who respects the business and wouldn't see the entire industry go belly up with out a fight. He will likley offer some sort of bailout financing.

Canadas oil companies on the other hand have no one to help. Our Prime Minister wants to rid the country of oil. And the majority of the people in Canada enjoy cheap fuel even though the entire economy is circling the bowl. Kenny may need to kick in some sort of funding but he really has no money to play with. Let's hope the global supply shrinks quickly due to price and 30$ oil is shortlived, regardless of the corona virus decrease in demand.

Hard to bailout finance if the industry is uneconomic. If cheap oil for long, demand will rise and it will go back up as well. 6-12 months and we could have better prices than we entered this with.

[Scott h]

Originally Posted by raab

On the good side, with cheap oil, the economy should come roaring back after the corona virus is dealt with. How long that takes is anyone’s guess at this point.

Absolutely, but it could be quite awhile.

[Deer Hunter]

Originally Posted by AndrewM

Hard to bailout finance if the industry is uneconomic. If cheap oil for long, demand will rise and it will go back up as well. 6-12 months and we could have better prices than we entered this with.

It's hard but the US government bailed out the auto industry in 2008 with $18 billion. It was unpopular at the time however Bush cited the importance of the auto industry long term...

[fishnguy]

Originally Posted by AndrewM

Hard to bailout finance if the industry is uneconomic. If cheap oil for long, demand will rise and it will go back up as well. 6-12 months and we could have better prices than we entered this with.

Russian ministry of energy stated today that they are expecting oil prices to rebound to about $45 by the second half of this year and remain there abouts. In 2021 they are forecasting $45-50 a barrel.

There is your story. They will kill shale and keep the price just low enough to keep it killed. They are fine with a $45 barrel; at $50 they are laughing.

[raab]

Originally Posted by Deer Hunter

You can't have energy independence and 30$ oil in the same sentence. He doesn't want to be dependent on Middle East oil does he?

Why not, they’re allies? He also has Canada who can be profitable at 30 dollar a barrel oil.

[AndrewM]

Originally Posted by fishnguy

Russian ministry of energy stated today that they are expecting oil prices to rebound to about $45 by the second half of this year and remain there abouts. In 2021 they are forecasting $45-50 a barrel.

There is your story. They will kill shale and keep the price just low enough to keep it killed. They are fine with a $45 barrel; at $50 they are laughing.

Biggest unknown is what the corona virus does the the world economy.

[fishnguy]

Interesting how it picked more than 300 points there in just a couple minutes coming up from below -1,700 before loosing some again in the last minutes. I wonder what hit the news or went through their minds.

Any bears out there yet?

[Deer Hunter]

Originally Posted by raab

Why not, they’re allies? He also has Canada who can be profitable at 30 dollar a barrel oil.

He's smarter than basing his entire energy needs on the Middle East circus.

Canada isn't profitable at 30$ oil. Look at the energy companies and how they have been reduced to a fraction of their value post Saudi Russia oil war

[AndrewM]

Originally Posted by raab

Why not, they’re allies? He also has Canada who can be profitable at 30 dollar a barrel oil.

$30 WTI? Not many in Canada are anywhere near profitable at those prices.
Kill shale oil and depend on other countries that rely on oil sales who can manipulate the price at will makes zero sense to me.

[raab]

Originally Posted by Deer Hunter

He's smarter than basing his entire energy needs on the Middle East circus.

Canada isn't profitable at 30$ oil. Look at the energy companies and how they have been reduced to a fraction of their value post Saudi Russia oil war

That’s because we have huge inventories, and trade about 15 dollars lower then WTI as a result. Once the market stabilizes and a few companies shut in. We’ll see inventory drops and Canadian oil price will narrow the gap with the WTI. It’s sustainable long term at 30 dollars a barrel, and good for the economy as a whole. Although not great for Albertans

[raab]

Originally Posted by AndrewM

$30 WTI? Not many in Canada are anywhere near profitable at those prices.
Kill shale oil and depend on other countries that rely on oil sales who can manipulate the price at will makes zero sense to me.

OPEC already controls the price, that doesn’t change.

[AndrewM]

Originally Posted by raab

That’s because we have huge inventories, and trade about 15 dollars lower then WTI as a result. Once the market stabilizes and a few companies shut in. We’ll see inventory drops and Canadian oil price will narrow the gap with the WTI. It’s sustainable long term at 30 dollars a barrel, and good for the economy as a whole. Although not great for Albertans

We still don't have WTI quality oil so we will never get par to WTI.

[bdub]

Anyone watching the press conference with Trump and Wall St exec's?

Trumps also saying words on decisions they have made at 6 PM our time.