As markets continue to yo-yo, and commentators deliver mixed forecasts, investors are faced with some tough decisions and have a number of important questions that need answering. On a daily basis we are asked; what’s happening with oil prices alongside questions on China’s slowdown, which commodities or instruments will provide safety in the current environment, will the Euro-zone split in the future and what impact the American presidential election is going to have on the economy and markets?
To help Oilprice.com look into these issues and more they spoke to award winning economic commentator Mike "Mish" Shedlock. Mike’s blog, Mish’s Global Economic Trend Analysis, is one of the most popular and informative economic blogs online. His millions of dedicated monthly readers find his advice invaluable and we recommend anyone interested in learning more about the global economy and financial markets to stop in and take a look: http://globaleconomicanalysis.blogspot.com
In the interview, Mish discusses:
- Why global trade will collapse if Romney wins
- Why investors should get out of stocks and commodities
- Why we have been oversold on shale gas and renewable energy
- Why oil prices will likely fall in the short-term
- Why the Eurozone is doomed
- Why there may soon be an oil war with China
- How government interference is ruining the renewable energy sector
- Why we need to get rid of fractional reserve lending
Oilprice.com: With oil prices now in the high 80s and news out of Europe getting worse every day, do you expect prices to stay in this range, or do you see them dropping in the short term?
Mish: There are two conflicting forces here. One of them is oil prices over the long-term and the other is oil prices over the short-term.
Even in the short-term you will find there are conflicting forces at play. For example, stress in the Middle-East puts an upward pressure on oil prices. However, economic problems in Europe, a slow-down in Asia and a slow-down in the United States put downward pressure on oil prices. New orders are falling at a staggering rate across the board in Asia, China, Japan, Europe and the United States which also puts further downward pressure on oil prices.
Long-term, forces such as peak oil and population growth in China are putting pressures to the upside.
One needs to balance all of those factors out when they are about ready to give a prediction on oil prices. My opinion is that over the short to mid-term, oil prices will go down. Long-term, energy is a good place to invest.
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