Oil Bubble?

My friend Paul points to this report by Factset, titled:  An oil bubble to rival the internet boom.

The difficulty with the bubble moniker is determining exactly how much of the price is being driven by purely speculative factors. With Crude, a variety of forces are driving prices: A combination of both fundamentals (increasing demand, constrained supply, pipeline problems), technicals (Trend, money flow, etc.), along with the geopolitics of two Middle East wars — as well as some speculation.

Additionally, we have seen the general perception of commodities shift, where they are now seen as a more legitimate asset class for portfolio managers, along with Equities, Fixed Income, REITs, cash, etc. than it has been previously.

Even If I disagree with the bubble thesis, I love any report festooned with lovely charts, and this one is no different:

5_year_perf_energy_it

   

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Source:
An oil bubble to rival the internet boom (PDF) 
FactSet, 3 May 2008
http://www.factset.com/websitefiles/PDFs/outlook/english/03-05-2008english.pdf

Category: Commodities, Earnings, Energy, Psychology, Technical Analysis, Valuation

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Trichet Warns of `Protracted’ High Inflation

Unlike the Federal Reserve, Trichet and the EC are very concerned with high Inflation:

Click for Video


Remember, the EC has a single charge — maintaining price stability — and is not concerned with maximizing growth . . .

Source:
Trichet Sees `Rather Protracted’ High Inflation
Gabi Thesing and Christian Vits
Bloomberg, May 8 2008
http://www.bloomberg.com/apps/news?pid=20601087&sid=aZrZpAw8DbmI&

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