A funny thing happened on the way to $200 a barrel oil. The price touched $147.27 and fell back to around $100 per barrel. (Who knew speculators had such power?) And though the danger of expensive oil destroying the global economy might have eased (that’s being done by the credit and mortgage crises), the real problem once again is complacency: complacency in conservation, complacency in not investing in and developing alternative fuel technologies, complacency in not demanding the U.S. government develop a comprehensive energy plan that promises the United States energy independence in less than 10 years.
We cannot be complacent or we’ll find ourselves in the same situation 20 years from now (or less). If we hadn’t been complacent after the first oil shocks in the 1970s, we might not be in this fix. Luckily, our ability to sound off on this happens next month, when two oil men will be leaving the White House and hopefully a more open minded and foresighted administration will take over in January. Even my staunchest Republican friends admit the Bush Administration has been a disaster (the most stubborn echo him and say history will be the true judge of his eight years, but none of us will be around then, so we must deal with the here and now). There is much work to do to get this country back on track, and it won’t be done by debating lipstick, celebrity status or age. It will be done by looking at the serious situation the United States is in on so many fronts and working to fix it. That means reining in spending, shoring up the economy, conserving energy and making tough decisions that will mean sacrifice on our parts.
In this month’s issue, we cover the upcoming U.S. presidential election between Barack Obama (D-Ill.) and John McCain (R-Ariz.) on several levels. We have a long-time trader Bill Pritchard discuss how each candidate’s policies will affect certain markets, including stocks, currencies and commodities (see “Trading the election”). Abe Cofnas discusses potential effects on the U.S. dollar in Forex Trader. And in our markets outlook, we asked analyst Phil Flynn to give a forecast on the energy market, not only because of that market’s volatility (which will continue especially as we go into the winter months), but because the election will affect its direction (see “How the energy landscape will impact the election”).
We also look at the base metals markets so crucial to the construction and communications sectors. The other day there was a news item about how some train signals weren’t working because someone had stolen the copper wiring from them and had mucked up the works. The commodities markets are so hot, even copper is back in vogue to the degree that that type of story has grown commonplace (see “Metal bull getting heavy,” by Senior Associate Editor Chris McMahon). And of course we have several stories on how to leverage trends in the energy and metals markets, with insightful trading strategies (see “Exploiting relationships in metal futures,” page 36 and “Crude companion”).
We also take a special look this month at some of the revolutionary developments in trading. This special section focuses on several areas that have been so important to the expansive growth of the derivatives markets, including electronic trading, advancement of data delivery and charting and product development, such as indexing and the forex markets. (See “Revolutions in Trading”).
As with most elections, this one will be historic. But one thing is certain, markets will respond and traders need to be ready to take advantage of the opportunities. This issue provides many ideas to prep you for those market moves, so at least if your candidate loses in November, your trading account can be a winner.
