Daily Brief – Oil

Oil

Why is oil at the year’s low? Look no further than the litany of reasons affecting the market as a whole. In no particular order: economic slowdown in China; vertiginous drop in Nvidia share price; disappointing economic releases in the USA particularly on Jobs and Manufacturing and last for good measure the expectation that Libya is about to restore production. To counterbalance the weak oil price, OPEC is likely to postpone the expected increase of 180,000 barrels a day. The other boost to the global economy lies in the possibility of the Federal Reserve cutting by 50 basis points instead of 25bps. The reasoning for that deeper interest rate cut is supported by another weak private sector jobs figure for the least week of August yesterday afternoon with 99,000 new US jobs created versus the expected 145,000.

Brent USD 73.39.

ABM

Was it a case of Anyone But Melenchon the Left Wing candidate for Prime Minister of France that led President Macron to select 73 year old Michel Barnier who to date has been best known for being the EU Brexit negotiator? Whatever the reasoning, Jean-Luc Melenchon is claiming that the election was stolen from the French people. So it is not just the USA that is experiencing such accusations from the losing party and of course the selection of a senior as a leader. More positively for France, their political leaders should now be able to do the job that they were elected to do such as setting France’s budget.

EUR/USD 1.1107.

Bruges, Belgium

The picturesque cobbled streets of Bruges, the canals, the pretty architecture and …8.3 million tourists a year. Such is the deterioration caused by such numbers  to the city that the authorities have capped any further hotel construction and the issuance of holiday home permits. Bruges has 120,000 inhabitants and like other places in Europe such as Venice and Barcelona the arguments in favour of allowing these numbers of tourists have given way to the acceptance that measures need to be introduced. Just try parking : many drivers give up and drive on to one of the many other Flemish destinations that are less well known and which still retain their charm-defined as being able to order and be served moules frites and a Belgian beer in half an hour.

EUR/GBP 0.8431.

Supply and Demand

An object lesson lies in the story of pop star Adele’s announcement that she is to take an indefinite leave from performing this weekend. Seats for Adele’s last scheduled concert on November 23 at Caesar’s Palace were trading at USD 2800 on Saturday but following her announcement on Sunday they rocketed to USD 4700. Alternatively Adele fans could buy her four studio albums and have change to take a luxury break anywhere in the world. But of course that’s not the point….is it?!

GBP/USD 1.3168.

Lay Lady Lay

One of Bob Dylan’s greatest songs which at this time in 1969 stood at Number 7 in the chartsand subsequently was recorded to great effect by The Band, Lay Lady Lay was originally written for the cult movie Midnight Cowboy but was not included because it was not submitted to the makers of the film in time. A truly 1969 rock and roll version of the dog ate my homework excuse.

Lay, lady, lay
Lay across my big brass bed
Lay, lady, lay

Lay across my big brass bed

Whatever colors you have
In your mind
I’ll show them to you
And you’ll see them shine

Lay, lady, lay
Lay across my big brass bed
Stay, lady, stay

Stay with your man awhile

Until the break of day
Let me see you make him smile

His clothes are dirty, but his-
His hands are clean
And you’re the best thing that he’s
Ever seen

Stay, lady, stay
Stay with your man awhile

Why wait any longer for the world to begin?
You can have your cake and eat it too
Why wait any longer for the one you love?
When he’s standing, in front of you

Lay, lady, lay
Lay across my big brass bed

Have a Great Weekend!

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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