Month: May 2018

Wednesday, 23rd May 2018

Sometimes, I wish I could drink petrol….

The price of oil is climbing….

On Tuesday evening, a barrel of Brent crude was priced-up at $79.35….

That’s an increase of more than 45% across the last 12-months….

Great news if you own an oilfield. For the rest of us, it’s going to lead to further strain on the wallet….

• Limited supply – but no shortage of demand….

America’s recent withdrawal from the Iran deal and renewed tensions in the Middle East are both factors in the most recent price actions in the oil markets….

But oil has been on a charge for a while now. And mainly because production cuts have served to decrease global supply….

But nobody is going to open-up the spigots and let the black gold flow more readily. You can rely on that….

OPEC agreed in 2017 to extend production cuts throughout this year. That means supply will remain limited until further notice….

There will be no shortage of demand though. That’s something else you can be sure of….

It doesn’t matter what economic activity you care to select – it has a clear and direct dependency on oil. There are not too many businesses that don’t need it or use it in one form or another….… Click here to read more

Wednesday, 16th May 2018

No closer to normality….

Cast your mind back to this day in 2007….

Can you remember what you were doing? Probably not….

Can you remember what interest rates looked like back then?

Allow me to refresh your memory….

Back in May 2007, the interest rate set by the Bank of England’s (BoE) Monetary Policy Committee (MPC) had just hit 5.5%….

Don’t worry, that’s not a typo….

I know it sounds fanciful, but I really do mean 5.5%….

• A 6-year high and more to follow….

That figure represented a 6-year high….

It was the result of the BoE increasing the rate for the fourth time in just 9-months….

The rate is the baseline figure that (to some extent) informs borrowers what they can expect to pay for credit and tells savers what they can expect to be paid on deposits….

The bank had been increasing the rate in a bid to curb an inflation figure that in March 2007 had been running at 3.1%….

The hope was that a rising interest rate would encourage consumers to stop spending money and start saving it instead – taking heat out of rising prices….

I don’t tell you these things because I think you’ll enjoy a trip down Memory Lane.… Click here to read more

Wednesday 2nd May 2018

Confidence is a funny thing….

What is confidence?

Is it something real or something imagined? Is it something that can be quantified and measured? Or is it something we create in our minds or hearts and cling onto?

Stoke City manager Paul Lambert is ‘confident’ his team can win their last two remaining games and somehow avoid relegation from the Premier League. But what will his confidence amount to if or when his team drop into the Championship?

Is his confidence a sign that he truly believes? Or is it just something he feels he must say under the circumstances?

Is he trying to convince us or himself? His players or his employers? Is he just genuinely deluded?

Confidence is a funny thing. It either comes and goes, ebbs and flows – or is never actually there to begin with….

If confidence is something real, it might genuinely help us. It might genuinely inform us. If it isn’t, then it might severely misguide its unwitting dupes….

• A dangerous game….

I’ve been thinking about the nature and roots of confidence on the back of something I saw a little earlier this week….

Apparently, British consumers are feeling more confident right now than at any time since January 2017 – about their household finances, about job security and about broader business activity….… Click here to read more