It is starting to look like there is great weakness in the silver and gold bubble that started nearly one decade ago. Recently, the price of silver has plummeted, which commentators have said is partly to do with the COMEX (CME Group’s) margin hikes. An increase in the cost to buy silver on the futures market means the most aggressive buyers and sellers alike have to unwind their positions.
So just how high will gas prices go before they retreat? At the time of writing, the price of a barrel of oil has surged from >$40 in 2009 to $111 in 2011, but where will the final resting place be? We’ll break down oil’s rise, and give a 2011 projection below.
In a recent post we uncovered the effects of high gas prices on economic growth, but it is also important to understand everything that the market has priced into oil. We’ll dissect oil’s pricetag, and seek to find what makes investors so bullish on higher prices for oil now and in the future.
The time value of oil
Wall Street is hopping mad! For seven straight days the domestic markets have rallied, bond yields have steepened and it appears that we’re all ready to go straight back to Dow 14,000. But what’s in the way? What is coming the months ahead, and is inflation as serious as we thought it was?