Brokers

☆ American “Frackers”: Bankers, Brokers, And Investors Can Feel “Seismic” Tremors In The Oil Bubble

News Analysis: The much vaunted “American Oil Fracking Technology” which the Mass Media loves to extol, is now being confronted with World Oil Over-Supply Realities. For American Frackers: Bankers, Brokers, and Investors can feel “seismic” tremors in the Oil Bubble.

Middle East Oil Producers (MEOPs), to their credit, did not cut oil production (as the “Masters of the Universe” for Oil, had forecasted). Instead, they are letting the “Law of Supply and Demand” burn out the vestiges of ‘Oil Frackers and Fracking’ around the globe. Since the “Lifted” costs from traditional oil production methodologies are considerably less, these ‘MEOPs’ can merely continue doing what they have done for decades; This, while the “American Technology Frackers” ‘Bite the Dust’ one by one in seriatim fashion.

Some International Businessmen are in amazement that Bankers, Brokers, and Small Investors were so naively sure about the anticipated behavior of ‘MEOPs’, that they had placed over an estimated $200 Billion Dollars with the ‘Frackers’; now they will feel the Oil Bubble Tremors (before it bursts). So much for the cost of arrogance.

We, at JSPP, had predicted the Reality of Oil Bubble Bursting long ago (even before the Mass Media jumped on the Pro-Fracking Bandwagon). Why? Because the “Law of Supply and Demand” in Commerce, is Inviolate!

Traditional Oil Suppliers typically have lower ‘Lifted Costs’ than ‘Frackers’; this, along with a ready supply of oil that they can send to market at a reduced price. The ‘MEOPs’ logic (with their ‘Deep Financial Pockets’): “These lower prices may be somewhat uncomfortable for our economies, but it is NOT FATAL to our operations”; as is the case for many ‘Frackers’. As the ‘MEOPs’ provide more and more oil, there will be logarithmic damage to the ‘Frackers’.

As the estimated $200 Billion Dollars in loans to ‘Frackers’ becomes due, and is not paid, the tremors felt in the American Oil Business will migrate throughout the economy. Since the price of Oil could go as low as $22 to $28 Dollars a barrel, one thing is for certain, many people filling up their cars with gasoline, at American Gas Stations, will have smiles on their faces.

As for the Bankers, Brokers, and Investors, who ‘bit’, was not it reported that ‘Fracking Can Cause Seisms’?

Reality.

Reference: http://rt.com/business/220619-shale-debt-us-companies/

Investments in 2014: All That Glittered Was Not Gold [But Brown And Black]

News Analysis: Coffee was the Investment Return Leader for the year, thanks to changing weather conditions and increased customer demand for the brew. If one looks carefully, he or she will see that as to Investments in 2014: All that glittered was not gold [but brown and black].

It is interesting to note that most commodities nose-dived in the on-going World-Wide Economic Slump, as did many financial instruments of many types.

Low interest rates allowed many corporations to borrow funds for repurchase of their stocks; thus boosting their prices. Since there is really little, in terms of economic prosperity, of demand for manufacturer’s goods, one can see an artificial economic bubble growing in size and based on mere holograms [for current Stock Markets]. Stock Markets love ‘Freiers’.

In 2015, as we have stated previously, Commercial Aircraft Manufacturers will have had their “Golden Fleece” taken from them i.e., the high prices of Aviation Fuel. Along with this, the Sukhoi Superjet 100 Aircraft, with Italy’s Alenia Aermacchi,  [which is currently Aviation Agencies’ Certified and flying] will cut into “Single Aisle” Jet Sales of the two Major Airframes. At approximately 35-40 percent of cost to Airlines, why pay more?

 Along with this, the Chinese Single Aisle, C919, was just Chinese Aviation Agency Certified, and will cut into the grossly profitable sales manufactured by the other Major Airframes.

Downstream, the Chinese/Russian Joint COMAC 929, 290 Passenger Jet, and COMAC 939, 390 Passengers Jet are being developed. The availability of funding for these projects by Chinese and Russian interests does NOT bode well for the existing two Major Airframes. Both, will “Pooh-Pooh” any suggestion of their losing market share [and huge profits]; they will probably seek government [surreptitious] interventions  to reduce the threats. Since America’s greatest monetary export manufacturer will be affected, International Businessmen can sit back and watch the machinations occur as Washington Politicians get desperate.

The long term outlook for both Major Airframes is one of high profit unsustainablility. The estimated $20,000,000.00 the aforementioned Airframe allegedly receives in Local, State, and Federal Grants PER AIRCRAFT, will help attenuate the pain perhaps.

Long term, a strong “Short Position” is warranted by International Businessmen and may be considered.

In 2015. we suggest focusing on Food for Seven Billion+ World Inhabitants; EVERYONE MUST EAT.

Conjoined with this idea, is that Climate Change should be carefully evaluated for geographic realities in regards to droughts,  rainfalls, severe weather, etc. thus affecting global food production.

There are other key areas in which to focus one’s evaluations and monies on for 2015 and beyond. To those who consult with us, we will be more than happy to share our analyses. To those who have obviously listened to their Financial Bankers, Brokers, and Gurus, we can only say: The Losing Investments outnumbered the Winners by a substantial margin. These ‘Masters of the Universe’ fates for 2014, in following the herd, have already been sealed, unfortunately for them.

Reality. 

Reference: http://rt.com/business/219187-coffee-price-oil-gold/

Confidence Games: If Two And Two Add Up To Five, Investors Are In Trouble

News Analysis: An Istanbul, Turkey, Currency Trader, of apparent British origins, is suspected of bilking his clients for more than 130 Million Pounds ($200 Million Dollars). Using various charades, he communicated to his unfortunate investors that he was not able to pay them back  their monies. Now, this apparent  British “Bernie Madoff” style Trader made off with investors’ funds. They should have realized, in  Confidence Games: If two and two add up to five, Investors are in trouble.

We think that in 2015, many more Financial Deviances will be sprouting up like weeds on Wall Street. Accountants, Arbitrageurs, Bankers, Brokers, Fund Operators, (AABBFOs) etc. will be ‘hard-pressed’ in the forthcoming economy, which we foresee. Flimsy investment advice by self-interested “Professionals” will not be able to cope with then-present economic realities. Investors will lose billions of Euros in such investments; this, both due to fraud but also ineptness of judgement.

As always, we suggest: “Trust, But Verify”.

If you want Business and/or Investment Advice, seek out those Seasoned Professionals who put their Clients First, and they, Second. Beware of those “AABBFO” ‘Professionals’ who have the mentalities of Trollops. They will not give you a ‘Treat’ but a ‘Trick’.

Reality.

Reference: http://www.telegraph.co.uk/news/uknews/crime/11307920/Police-let-trader-at-centre-of-130m-con-slip-through-their-fingers.html

☆ Bermuda Casino Gambling; “Smell Tests” Are Not Required [Due To Sea Breeze]?

News Analysis: The Senate of Bermuda voted to allow for three Gaming Establishments on the island. First one would be built, then the next two would follow. During the Senate debate, the question of strengthening the proposed Casino Law to preclude miscreant behavior was suggested by some Senators. The other Senators thought such negative activities were covered already in Bermuda’s Criminal Code. The “Smell Test”  sought, was dispensed with by the majority.

It is interesting for International Businessmen, of which Bermuda has many, to note that the “Free Market Place” is hardly such. Bermuda Is To Have Casino Gambling; “Smell Tests” Are Not Required [Due To Sea Breeze]?

Internationally, there will always be the lurking “Shtarkers” who want to take advantage of the “Freiers” in all economic activities; the London Interbank Offered Rate (LIBOR) Scandal is just one example. Another example is the “Afternoon Gold Fixing Rate” in London.

One can find many examples of Accountants, Arbitrageurs, Bankers, Brokers, Fund Pool Managers, and others looking to ways to “Game the System”; the ‘Morality of the Marketplace” currently being a giant ‘Sinkhole’. “Smell Tests” can be very helpful to the Wise.

One should realize that while the aforementioned activities are actual, the adage to those who want to enter this melee is: “If you are afraid of receiving ‘fast ball pitches’, do not get up to the ‘plate’ to bat.”

Smart International Businessmen always ‘Sleep With One Eye Open”.

Reality.

Reference: http://www.royalgazette.com/article/20141217/NEWS/141219734