Oil limbo continues: how low and long can it go?

As the talking heads are all doing their usual–confirming a downtrend that has already been progressing for many months–the next consensus view is that the downturn in oil prices will be short-lived.

This long term view of WTIC since 1985 offers an alternative perspective on the extreme price spikes orchestrated by financial intermediaries the past 10 years, and why below $40 a barrel (green bar area) may actually be the natural resting place for West Texas Crude (lower for Canadian Crude) in the post-financial bubbles era…
WTIC Dec 15 2014
The energy debt market is not feeling optimistic, as bond prices are evaporating in the once reckless ‘hot’ sector. But not to worry, investment bank ‘strategists’ remain universally bullish, the most recent Barron’s survey could not find one person to say stocks would fall in 2015.   There’s some comfort for frazzled nerves…??

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How the NFL leaves players broken–and broke

In a world preoccupied with ‘getting money’, far too little is understood about the high incidence of losing it once obtained. A new book discusses the reality in the context of Football players, but there are lessons here for everyone:

Life after football“Is There Life After Football?” brings us inside the lives of NFL players to show why so many wind up in dire straits after their time on the field, from depression to debilitating lifelong injuries to catastrophic financial mismanagement…

The book seeks, among other things, to dispel the myth that everyone who plays in the NFL is financially set for life.

The average NFL career is only 3.5 years long, and while even rookies currently earn around $400,000, the types of money we hear about for superstars — $22 million a year for Green Bay Packer Aaron Rodgers, for example — is rare. Most players never come close.

But how ever much money players make, it’s often far more than they know how to handle…if using family and friends as financial advisors is a bad move, actual advisors can be worse.

Regulated or not, shady advisors have made quite a mark on the NFL financial scene,” the authors write. “Before closer scrutiny was instituted, at least 78 players lost more than $42 million between 1999 and 2002 because they trusted money to agents and financial advisors…”  See:  NYP:  How the NFL leaves players broken–and broke

Author Malcolm Gladwell offered some social and historical context on the NFL last month. Here is a direct video link.

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World Outlook Panel

Is the US Equity Market the Only Game in Town? Danielle Park, Partner & Portfolio Manager, Venable Park Investment Counsel, Grant Williams Senior Advisor, Vulpes Investment Mgmt / Things That Make You Go Hmmm … and John Kaiser, Kaiser Research at the Toronto Investment Conference on September 25, 2014. Here is a direct video link.

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Skilled workers wanted

Over the next 15 years, as populations continue to age and retire, bargaining power will increase for the smaller pool of skilled workers coming after the boomers.

It sounds counterintuitive, but by 2030, many of the world’s largest economies will have more jobs than adult citizens to do those jobs. In this data-filled — and quite charming — talk, human resources expert Rainer Strack suggests that countries ought to look across borders for mobile and willing job seekers. But to do that, they need to start by changing the culture in their businesses. Here is a direct video link.

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High debt and over-valued housing haunt Canada

As oil revenues recede and jobs wobble, over-indebted Canadian households are extremely vulnerable. No wonder CMHC is downsizing, and Canadian bank shares (hideously over-valued) are falling…

Consumer debt loads and house prices that could be as much as 30 per cent overvalued are the two biggest risks to Canada’s economy, the Bank of Canada warned in its semi-annual Financial System Review on Wednesday. Here is a direct video link.

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Captured Congress still at Wall Street’s bidding

So long as investment banks remain the bit in the government’s mouth, we will struggle to get the real economy back on a constructive, sustainable path.  We the people, will continue to be bankrupted by reckless risk-seekers backed by the public purse.  The derivatives market is something in the area of 600 trillion today and taxpayers are being pledged to back stop the solvency of ‘players’.  This is truly insane.  With empty speeches but policies that continally favor Wall Street, Barrack Obama as a leader, has failed his country miserably.  See:  Wall Street’s win on Swaps rule shows resurgence in Washington.

“Wall Street is re-emerging as a force in Washington as it closes in on one of its biggest wins against regulation since the financial crisis.

With must-pass spending legislation making its way through Congress this week, banks seized on an opportunity to attach a measure that would halt a planned restriction on derivatives trading they had long opposed. The industry’s lobbying extended to the highest levels of finance with JPMorgan Chase & Co. (JPM) Chief Executive Officer Jamie Dimon pressing lawmakers to support the change.

Wall Street’s success, after four years of struggling to persuade Congress to ease the Dodd-Frank Act, is a precursor to more fights next year against some of the law’s hallmarks: the consumer protection bureau and stiff oversight of big financial companies whose failure could threaten the financial system.”

Also see: Jamie Dimon himself called to urge support for the derivatives rule.

And watch: Elizabeth Warren fights back on spending bill provisions

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