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Rising world oil demand and the U.S. economy. Prof. Hamilton is an expert on this subject, and he testified before Congress’s Joint Economic Committee yesterday. I recommend his complete testimony if you have time. The intro:

Big increases in the price of oil that were associated with events such as the 1973-74 embargo by the Organization of Arab Petroleum Exporting Countries, the Iranian Revolution in 1978, the Iran-Iraq War in 1980, and the First Persian Gulf War in 1990 were each followed by global economic recessions.

The price of oil doubled between June 2007 and June 2008, a bigger price increase than in any of those four earlier episodes. In my mind, there is no question that this latest surge in oil prices was an important factor that contributed to the economic recession that began in the U.S. in 2007:Q4.

Corporate bonds remain on fire. I am of the opinion that bond traders are (much) smarter than equity traders. Apparently, corporate bonds have been catching ever higher bids on increasing volume over the past few weeks, and the pace is accelerating.

Dollar Is Dirt, Treasuries Are Toast, AAA Is Gone: Mark Gilbert. I wonder, what data would I examine to support or to refute this claim?

Currency markets have been in a weird state of what looks almost like equilibrium for the past couple of months. What’s really going on is something akin to an evenly matched tug of war that fails to move the ribbon tied around the center of the rope, giving the impression of harmony while powerful forces do silent battle until someone slips.

If Anyone Understands Mackese, Please Translate. Someone should re-mix this and sell it as a meditation aid.

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