Cheapest ever fill up

[Perfectlap]

Originally Posted by Giller

Not necessarily. There is a lot of talk that oil could go down down down much more. If that's the case, it could cause a lot of grief to both the US and Canadian economies. If oil prices fall too much - it just won't be cost effective to get the oil out of the ground - will be cheaper to bring it in from overseas.

It's sad - but we actually need oil prices at a 'higher' level for the good of the whole economy. (not crazy high, just high enough to make it profitable).

When people talk about those low oil prices and cheap gas - remember, that oil all came from the middle east. So we can go back to depending on them for our oil or we can pay a bit more for it and dig it up here.

That's all it is talk. Oil prices will be back up because lower prices globally will lift aggregate consumption. Some analysts project a half point increase in global GDP from ~$50 oil. The longer these low prices stick the more consumption of just about everything will pick up (the best stimulus there is for the U.S. consumer) which of course shifts the all important expectation of demand back in a bullish direction. Global production was exceeding actual demand even back when oil was pinned above $100. Yet the prices would not budge! Evidently the speculators expected demand in the faster growing economies to keep plowing ahead despite the excess production.
Obviously they don't expect that to be the case in the near term anymore but you can't stop countries with low debt, growing populations, easy access to capital, and improving infrastructures to just grind to a halt forever. The expectation of demand can turn on a dime. I remember in 2008 or there abouts when oil prices shot north in the middle of the trading day because some news site reported a gun boat battle in the Gulf... that happened two days prior.

Originally Posted by thstone

I think a more accurate statement is that the rich are getting richer by leaps and bounds as the truly poor merely inch upwards over time.

The bottom line is that everyone, rich and poor alike, get richer each year (but by differing amounts).

I believe that the middle class are actually getting poorer when you factor in all their long-term commitments and their higher expected household contributions. For instance, the savings rate in America is still barely 1-2% but the cost of just about everything but oil is rising. Unless the typical American has some portion of their savings in aggressive investments, (that ends well) this math of what's coming in vs. what's going out doesn't really add up over the course of a working life. I'm not sure how any growth in net worth can be expected running a household deficit and the fact that people are no longer getting rich from owning their homes. Wage increases for the majority haven't been anything to write home about since we were putting people on the moon.
Agree on the wealthy. This is about the best time ever to be an investor. Low taxes relative to just about every other advanced economy, plenty of corporate global growth to see your LTCG rise indefinitely.

[Giller]

Originally Posted by Perfectlap

That's all it is talk. Oil prices will be back up because lower prices globally will lift aggregate consumption. Some analysts project a half point increase in global GDP from ~$50 oil. The longer these low prices stick the more consumption of just about everything will pick up (the best stimulus there is for the U.S. consumer) which of course shifts the all important expectation of demand back in a bullish direction. Global production was exceeding actual demand even back when oil was pinned above $100. Yet the prices would not budge! Evidently the speculators expected demand in the faster growing economies to keep plowing ahead despite the excess production.
Obviously they don't expect that to be the case in the near term anymore but you can't stop countries with low debt, growing populations, easy access to capital, and improving infrastructures to just grind to a halt forever. The expectation of demand can turn on a dime. I remember in 2008 or there abouts when oil prices shot north in the middle of the trading day because some news site reported a gun boat battle in the Gulf... that happened two days prior.

I read a ton of 'articles' relating to mutual funds and the stock market, and of course Oil is heavily mentioned. For every article I read saying oil is going up, I can find one that says it's going down. A lot of 'conspiracy theories' out there - the biggest being that oil is being forced down in price in an attempt to cripple Russia economically. Others think the mid east is pushing prices down to hurt US production. Many experts claim it's about China and how their growth has stabilized and therefore demand is down big time. At the end of the day, it's a whole bunch of speculation - and you might be very right and it'll shoot back up - or my gut might be right and it keeps going down. Either way, there is money to be made in the markets right now - just might be a bit longer term.

[Perfectlap]

Originally Posted by Giller

I read a ton of 'articles' relating to mutual funds and the stock market, and of course Oil is heavily mentioned. For every article I read saying oil is going up, I can find one that says it's going down. A lot of 'conspiracy theories' out there - the biggest being that oil is being forced down in price in an attempt to cripple Russia economically. Others think the mid east is pushing prices down to hurt US production. Many experts claim it's about China and how their growth has stabilized and therefore demand is down big time. At the end of the day, it's a whole bunch of speculation - and you might be very right and it'll shoot back up - or my gut might be right and it keeps going down. Either way, there is money to be made in the markets right now - just might be a bit longer term.

If you are talking about actively managed mutual funds, I would use their articles for bird cage liner. 99% of those guys missed the obvious as the Sun economic collapse in the first place. You didn't need to be a genius to see the lend-to-securitize frenzy of everything and the kitchen sink. When your investment firm misses something that big I no longer trust your ability to predict anything. The best articles are those that predict nothing and simply tell you what has changed. Armed with that, you'll be as good at predicting as they have ever been. And any conspiracy theorists that think they can assemble a group to move the price of a commodity like crude down 50% have to change the tin foil on their hats. The expectation of demand is a global soup that no one group or group of nations can manipulate. Those days are long gone.

[Giller]

Originally Posted by Perfectlap

I believe that the middle class are actually getting poorer when you factor in all their long-term commitments and their higher expected household contributions. For instance, the savings rate in America is still barely 1-2% but the cost of just about everything but oil is rising. Unless the typical American has some portion of their savings in aggressive investments, (that ends well) this math of what's coming in vs. what's going out doesn't really add up over the course of a working life. I'm not sure how any growth in net worth can be expected running a household deficit and the fact that people are no longer getting rich from owning their homes. Wage increases for the majority haven't been anything to write home about since we were putting people on the moon.
Agree on the wealthy. This is about the best time ever to be an investor. Low taxes relative to just about every other advanced economy, plenty of corporate global growth to see your LTCG rise indefinitely.

I missed this part earlier. I would counter that the savings rate is irrelevant and history shows that the savings rate closely matches the inflation rate and therefore, you never actually 'make money' in a savings account-type investment. And then factor in taxes on that income, you actually have less buying power. Higher rates typically mean higher inflation and therefore nullify those high rates.
You definitely have a point on the house aspect. People are now carrying mortgages well into retirement - something that didn't happen even 10 years ago. Therefore people now have to work longer into what normally would be their retirement, which can have a huge impact on a person's stress levels and therefore overall health.
I still argue a portfolio filled with a variety of blue-chip, dividend paying stocks will provide you the best return over the long term, with a small portion in savings to cover those emergencies. (don't want to have to cash out if the markets are down) The key of course is not panicking and selling when the markets go down. That's when you buy!

[Perfectlap]

Originally Posted by Giller

I missed this part earlier. I would counter that the savings rate is irrelevant and history shows that the savings rate closely matches the inflation rate and therefore, you never actually 'make money' in a savings account-type investment. And then factor in taxes on that income, you actually have less buying power. Higher rates typically mean higher inflation and therefore nullify those high rates.

Well most wealth is NOT inherited so savings in whatever vehicle (cash, equity, fixed income, etc.) that the worker chooses has to be at some level above negative to expect the average person's net worth to rise in a significant way. If the average worker is only putting up 0 - 2%, then that contribution has to be doing some pretty heavy lifting on performance to ensure 20+ years of security in retirement. The home mortgage as you say is just a liability these days.

I think your comments on savings/inflation rates were based on a time when central banks weren't as active as they are now. But even if we weren't into this ZIRP era, the growth of global corporate wealth would still push the average investor to lean heavily on equities to 'make up' for lost time. Global growth is just too tough an act to follow for competing non-equity investments, especially to someone whose time in the workforce is ending soon.

[coreseller]

Many things factor into savings rates, a VERY interesting chart concerning savings rates over the past 56 years for US Citizens:

United States Personal Savings Rate | 1959-2015 | Data | Chart | Calendar

A paradigm shift of retirement vehicles should start rearing it's ugly head in the next 15 to 20 years (baby boomers started retiring in earnest in 2011) if not sooner, conventional pensions and what were otherwise structured retirement programs will begin petering out / become a thing of the past. The other 800 lb. gorilla, health care costs will be burdened by whom?

Think of the average Joe and the look they have on their face when confronted with anything resembling financial acumen and preparing for the future, they totally zone out and want to hear none of it. As the comedian said, You can't fix stupid.