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Rbs Warns Traders To 'sell Everything'

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http://www.thisismoney.co.uk/money/markets/article-3396092/RBS-issues-sell-alert-fears-mount-10-oil-price.html

$10 barrels of oil. Anyone called that?

'But RBS sounded the strongest alert, issuing advice to clients saying 'danger is lurking out there for every investor' and 'the downside is crystallising. Watch out. Sell (mostly) everything.'

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'But RBS sounded the strongest alert, issuing advice to clients saying 'danger is lurking out there for every investor' and 'the downside is crystallising. Watch out. Sell (mostly) everything.'

Hmm, RBS called the top last time round didn't they!

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gold_div_crude.gif

Oil hasn't been this cheap, in terms of gold, for some time, well maybe in about 1972

Zeal040105B.gif

The spikes indicate, we don't hang about the extremes for too long.

---

And then we had the massive inflation in the 1970s - check it out!

bla3.png

Edited by 200p

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If I could buy oil and store it safely, I would be piling it up for future use.

At least oil can't go to zero.

That's what option contracts are for.

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http://www.thisismoney.co.uk/money/markets/article-3396092/RBS-issues-sell-alert-fears-mount-10-oil-price.html

$10 barrels of oil. Anyone called that?

'But RBS sounded the strongest alert, issuing advice to clients saying 'danger is lurking out there for every investor' and 'the downside is crystallising. Watch out. Sell (mostly) everything.'

..RBS survived because of State rescue....they are not true traders... :rolleyes:

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That's what option contracts are for.

Not a good idea because then you are reliant on a third party. This is what undone the Hunt brothers from Margin calls.

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Rather than listen to RBS, let us listen to some measured commentary on what's going on. Some recent info

http://www.marketwatch.com/story/if-you-think-oil-is-cheap-in-dollars-its-even-cheaper-in-gold-2016-01-08

More from Nic on their website on energy http://www.convergex.com/the-share/google-search-trends-in-energy

So what consumer shifts are occurring as oil and gasoline prices continue their decline? Because this drop really began in the second half of 2014, American consumers have had 18 months to start incorporating structurally lower oil prices into their economic decision-making. Typically, short downdrafts such as the 2008 experience ($140 to $40/barrel in a few months) are not long enough to really sway public perceptions of normalized energy costs. This time around, with a year and half of water under the bridge, is a different story.

And what he thinks 2016 will bring

http://www.convergex.com/the-share/a-2016-survival-guide-top-10-topics-likely-to-dominate-capital-markets-for

Edited by 200p

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At some point, these prices are going to force the fracking/shale operations out of business en-masse and also to result in reduced development of new sources - bound to be a violent swing back in the other direction especially when the money printing starts again in earnest.

Remember that oil was able to trade happily at >$100 for long periods of time during the slump after the 2008 bust even though demand had fallen and more and more sources were coming online, IMO thanks to the availability of lots of printed 'money' being thrown at the financial sector.

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Not a good idea because then you are reliant on a third party. This is what undone the Hunt brothers from Margin calls.

Exchange traded options are guaranteed by the Options Clearing Corporation these days, so basically zero counter-party risk.

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What's up with an ETF for buying? Should one want to?

USO is one, or OIL. they both basically track oil prices. Then there's oil services - OIH - and Oil producers - XOP. Or you could go for XLE, a broader energy ETF.

All on the US markets, but should be buyable in most UK accounts once you've filled in a W8-BEN tax form for your broker.

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Cheap oil is good for us. Just about everything you buy has the oil price factored into it somehow. Not so good for Russia, Brazil, Venezuela, Nigeria etc. I'm filling my car for <£1. Long may it last.

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Nope ETFs no good either - if you plan to hold for a decade. If you don't know what contango, or fees for exchanging £ to $, and $ to £ on exit, and the annual fees, forget it.

When palladium went up 50%, the physical ETF only went up 22%! You just can't beat fictionalization (spell check did the Freudian slip for me) of the markets.

Edited by 200p

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Cheap oil is good for us. Just about everything you buy has the oil price factored into it somehow. Not so good for Russia, Brazil, Venezuela, Nigeria etc. I'm filling my car for <£1. Long may it last.

....when it is cheaper means we can travel further.....the further we go the more we explore, the more people we meet and the further our money can be dispersed....travelling must help the economy......staying at home helps no one, high transport/postage costs and more expensive non-discretionary goods only mean people spend less or avoid spending on the extras over and above what they need... ;)

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Nope ETFs no good either - if you plan to hold for a decade. If you don't know what contango, or fees for exchanging £ to $, and $ to £ on exit, and the annual fees, forget it.

That's where things like XOP, the oil producers, come in. Since it's just a basket of stocks there's no futures drag to worry about - expense ratio (built into the ETF price so not something you pay separately ) is just 0.35%, which is more than covered by the dividend.

Currency exchange should be negligible if you have a decent broker... maybe pound or two commission and 100th of a penny bid/ask spread.

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Cheap oil is good for us. Just about everything you buy has the oil price factored into it somehow. Not so good for Russia, Brazil, Venezuela, Nigeria etc. I'm filling my car for £1. Long may it last.

That's one hell of a small fuel tank. Edited by stoobs

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....when it is cheaper means we can travel further.....the further we go the more we explore, the more people we meet and the further our money can be dispersed....travelling must help the economy......staying at home helps no one, high transport/postage costs and more expensive non-discretionary goods only mean people spend less or avoid spending on the extras over and above what they need... ;)

Networking is vital to business and face to face is far better than skype. The cost of travel in the UK, especially from the most distant regions to London, is one of the major impediments to small businesses and start-ups, and the reason the regions don't do as well as they could IMO, and this affects the whole economy. Unfortunately, other than the petrol in your car, I don't see that train travel, which is the best way to travel as you can work at the same time, will get any cheaper.

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