Sushi Money

Spent a great weekend mostly outdoors enjoying some beautiful Autumn weather.  Don’t you just love this time of year?  The leaves are changing colors, the air is crisp and cool, and it gives us a chance to catch up on things we’ve put off for too long. It’s also just plain fun to explore the countryside and get out a little more, especially with lower gas prices! We even marched in a parade this weekend, listening to the sounds of a high school band.  For all the challenges the nation faces, it’s great to see people involved in the community and enjoying the timeless traditions each year.

Gas prices in our area have fallen drastically in recent weeks.  You can sense relief at the pump when filling up.  It’s all part of the great unwinding of leverage.  The more we read about the financial mess it appears that hedge funds and other large insitutions have caused much of the drop in share prices through liquidation of investments in order to raise cash.   Some people believe this unwinding will continue with more downward pressure on stocks.  Others believe we’re close to a bottom, and even Warren Buffet is pitching to buy stocks right now.

As for oil prices, we don’t see those “experts” talking about $200 or $300 oil anymore. In fact, many people believe oil could fall below $60 a barrel for some time, and OPEC is scrambling to put production cuts to shore up prices.  

“OPEC, supplier of about 40 percent of the world’s oil, may pare output by 1 to 2 million barrels a day in stages to stabilize prices, said Chakib Khelil, the group’s president. Deutsche Bank AG lowered its 2009 crude oil price estimate by 35 percent to $60 a barrel, citing the possibility of a “major world recession.”  

Maybe they’ll succeed for a time, but how anyone can say that consumer demand was the primary reason for the runup of oil prices is beyond me.  Yes, there is huge demand for oil- too much demand as the U.S. is dependent on foreign oil and prices rose sharply. But that is only because supply was so restricted, and speculation by investors also impacted demand.  Speculation has played an enormous role in our oil markets in recent years and now we’re seeing prices stabilize with the unwinding of leverage and credit crisis impacts. 

But guess what?  Lower oil prices may not last beyond a few months or a year or two because the world’s appetite for oil continues to increase and we’re still not producing enough here in the U.S.

There is real demand for oil globally, and there are only so many places we can get our oil from. So yes, the price we pay for oil will be driven by the demand and the supply of oil we can produce or import over time.  Investors will also return to the oil markets and at some point we’ll see prices rise again.  Let’s hope that between increased production in the U.S. and reduced demand through higher mileage and alternative vehicles, that prices won’t rise quite as high as they did this year.

****************

In other news I will say that I was bothered that Barack Obama raised over $150 million dollars during the month of September alone.  That’s more than George Bush and John Kerry raised combined during the 2004 election!   Why does that bother me?  Mostly because he’s taking money from private sources, instead of public funding like John McCain.

With public funding, we know where it comes from, who gives it, and there are detailed records and accountability.  Senator Obama had earlier pledged to stick to public funding, but later changed his mind and broke that promise, taking millions from private sources instead.  Where is that money coming from?  Who are the people and institutions that are “buying their way” into the campaign coffers of one of our Presidential candidates?  

I’m no expert but I thought that campaign finance reform was supposed to reduce that type of thing?  In any event, Senator McCain is not lacking for funding either, although he’s behind Obama.  McCain received a big chunk of matching dollars to help finance his campaign:

“Helping Sen. McCain keep up was the one-time, $84.1 million in taxpayer matching money he received in September. Sen. Obama won’t get such a one-time payment because he opted out of public financing after first suggesting he would participate, a decision that has cost him some political points.”

“Public financing gives candidates taxpayer money for their campaigns, but it also requires them to hew to spending limits and essentially stop fund raising for themselves during the general election. The parties can continue raising money for the candidates; however, much of their spending must be conducted independent of the presidential campaigns. By opting out of public financing, Sen. Obama is free to spend as much as he can raise.”

“McCain spokesman Tucker Bounds said the campaign can overcome the fund-raising mismatch. “We are going to be competitive because, despite Barack Obama’s best efforts, this is an election not an auction,” he said.”

“The Obama campaign has also fielded criticism from Republicans for what they say is a lack of donor transparency. Federal rules don’t require disclosure of donors giving less than $200. Small donors account for about half of Sen. Obama’s 3.1 million contributors.”

I will say that I’m tired of being bombarded with tv advertisements for the candidates. We don’t watch much tv, but do have it on in the evenings.  The “I’m so-and-so, and I approve this message” line is getting really annoying.  I find myself hitting the mute button, regardless of which candidate’s advertisements are playing.

I do have a preference for one candidate over the other at this point, but I would rather not make this a politically focused discussion.  I will say that I think the nation is so much greater than any one candidate, President or their administration.  If I have any concerns, it is more about a possible Liberal Supermajority taking over the nation’s highest offices as President and in Congress.  I don’t think either party should have a lock on both Congress and the Presidency.  That gives the politicians nearly free reign to pass whatever legislation they think is okay. 

Yet regardless of who is elected this year, I think we’ll be fine.  Both Senator McCain and Senator Obama should be able to gather effective representation within their party to lead the country through the recovery over the next four years.  It may be a little more painful in some areas such as taxation or spending cuts, but we’ll get through it.  I think the nation’s political focus also goes in cycles.  It may be time for more change than many of us are prepared for!  But in another four years we can revisit the process once again.  Have a good week.

No comment - Post a comment

« 5.8% Increase in Social Security for 2009 | Uncertain Times: Today is Enough »