A new high (or high of the day)

[peternap]

Oil is over $129.00 today and with the holiday coming, I expect gas to go up quickly.

Larry and I were talking to a fellow last night, that was adding used motor oil to his diesel, with good results. He's doing 50/50 but I don't think the Green Hornet will run that. But.....if I can do 20% oil, it moves back the hands of time. I think I'll try next week.

I just heard on the commodities report to expect a .20 cent increase per pound for beef soon. I think it may be higher because of the fuel prices.

[Homegrown Tomatoes]

You know, Peter, the crazy thing is I watched the news for the first time in eons the other day (I'm talking TV news... something I almost never watch) and they keep trying to say that the economic slump is very "temporary" and on the verge of a rebound.  I am wondering what planet they are on?  Do they think that just by saying things are getting better that they will?  I think to a degree a second Great Depression would do more good than an economic rebound, anyway.  It was just bizarre to watch the newscaster reading her teleprompter and saying that the downturn in the economy would be short-lived, etc. 

[muldoon]

I think were gearing up for some more trouble in the coming 10-30 days.  As for todays spike in oil, you had all the classical elements of inflation fear, devalued currency and supply and demand mismatch.  the indicators are on tilt. 

USDX dollar dropped -
went down to 72.3 earlier, still .5 down now.  http://quotes.ino.com/chart/?s=NYBOT_DX&v=i

gold & silver spiked - gold up 16 bucks, and silver up a whopping 5%. 
http://www.kitco.com/market/index.html

news from UAE - seems they are importing coal to keep their lights on .. wait what?
http://www.timesonline.co.uk/tol/news/world/middle_east/article3958606.ece

news from kazakistan, they are suspending crude exports.  wait, if were in a commodity bubble shouldnt they be selling it as fast as they can? 
http://www.forbes.com/feeds/ap/2008/05/19/ap5026184.html

and this morning looks like cnbc did a spread on "peak oil"  causing more fear in the market.  While this may not be "news" to some, being shown on Squawkbox at the beginning of the investment day is certainly new to me.  This is usually happytimeTV, exactly as homegrown tomato indicated above - its all rosy.  Speaking of peak oil is not the norm in financial news.   
http://www.cnbc.com/id/15840232?video=747947551
http://www.cnbc.com/id/15840232?video=742031646

inflation fears keep ramping with the cool CPI out this week, giving less and less confidence in US numbers. 
http://www.bls.gov/news.release/pdf/cpi.pdf
come on, how dare the fed actually report a 0.2% increase in food prices year over year from march, 0.9% in april!!?  Is food only up 1% from last year for anyone?  The good news is that in the month of April gasoline only went of 0%, or 5.9% collectively for the annular rate.  It's completely unbelievable for anyone in the real world.  If people cannot believe the statistics, they are going to think the worst regarding cpi, and thus inflation in general. 

They also have been propping up 79 year old Volcker to speak of inflation, and as the IRX rises around 1.86 another fed EFF cut seems very unlikely (if you watch the trend of the last 3 decades that is).  I expect rates to increase or hold for the time being.  yeah, this is starting to leak out as well.  They seem to be telegraphing this everywhere, not the message - just the framework for the message to come later. 
http://www.marketwatch.com/News/Story/Story.aspx?guid=5fbde748da5e44b6b4d1e7fcc8483e1e&siteid=nwham

The dow is down 214 points, to the 12800 number that has been the resistance/support for months.  It hit the 200day moving average and has trended down since.  It could go either way from here.  If it drops under this number with any significant strength, the next support level is way down at 12350 level, then 11700ish that it saw earlier this year. 

in short, ALL indicators point to it will take more dollars to buy anything of value in the near to medium term future, as this understanding plays out expect equities to continue to drop as the realization hits that profits will continue to be lower for the foreseeable future across the board.  oil is of value and will go up because it takes more dollars to chase real goods.  as people leave tanking stocks, expect some to chase commodites as they go up -- thus making them move even faster.  There are many variables in how this plays out from here, but I dont really see anything good on the horizon.   Sorry if I'm being too negative.  Can someone see some silver lining and share it with me? 

[peternap]

Damn Muldoon, you spend more time glued to the news services than I do.

I don't see any silver either. I'm just playing the game for now. One thing I'd love to know though is how the hell the hedgefunds always know in advance. Did you see all the short drives yesterday. They were tripping stop losses all over the place even though the market was up.

Today, they didn't need to keep driving the prices down. CNBC did it for them. It doesn't really bother me money wise, I just bought on the low yesterday but it'll be Monday before it goes up enough to take a profit.

The only long stock I own that hasn't been hit yesterday and today is SOLF. I bought that at $10.00 but I'm watching it hard. The quarter wasn't THAT good.

[Homegrown Tomatoes]

I don't think either of you are too negative... just honest on it.  The good I can see coming out of it though is hopefully a change in the way Americans live... maybe not a silver lining, but good for us.   A lot of things that are good for us don't feel so good. 

[Redoverfarm]

Peter I hope you are right about the cattle.  As far as the deisel goes.  I slipped into your state today. Filled the truck, 2 =5 gal gas, 3 -5gal off off road and it was still $212.00 and that doesn't count the coffee. 

Local has been making his own fuel from resturant oil.  Has about $.75 a gallon in it. Down side is that with the cold weather it wants to gel up in the winter. Well at least he can run it a few months now since the dawn of summer is on us.

Oh yeah I heard on the news that the housing slump will be Ok by 1st of the year.
They just failed to say which year.

[Homegrown Tomatoes]

Oh yeah I heard on the news that the housing slump will be Ok by 1st of the year.
They just failed to say which year.

Oh, heck, on the news I was watching the other day, they were claiming it is already coming out of the slump!  Hilarious.

[MountainDon]

Down side is that with the cold weather it wants to gel up in the winter. Well at least he can run it a few months now since the dawn of summer is on us.

The way to handle the cold weather with veggie oil is to run the veggie oil in a separate tank. Have regular diesel in the truck tank. Have a selector valve. The special veggie tank also needs to have some heat exchanger coils in it that circulates hot engine coolant. You start the engine on regular diesel. When the veggie oil warms up enough to be able to flow you switch to the veggie oil. It is important to remember to switch back to running straight diesel long enough before you shut down to allow all the veggie oil to be flushed clear of the fuel system. Otherwise you'll be waiting for a warm day or you'll be tearing down the injection system, before it'll start again.

[Redoverfarm]

I think he found the solution of sort. Diluted it with something. I am sure it wasn't kerosene.   Why not alot of the old time truckers used it in the winter to eliminate the gel.  Don't know what DOT would think about it. Probably the same thoughts as Off road in On road vehicles.

[MountainDon]

I used to add kerosene when I wasn't sure if the fuel 'on tap' was the winter formula.

No road tax on the kero, so 'they' wouldn't like it. 

[glenn kangiser]

I thought this discussion was going to be about some new kind of shrooms Peter found.

[peternap]

The same thought crossed my mind when I wrote it.