Ep. 549 – Markets Overnight

The Kapital News
The Kapital News
Ep. 549 - Markets Overnight

A focus on the overnight trading session on Sunday evening as markets around the globe begin to open. What is of particular interest, is the price increase in WTI and Brent crude oil. Where WTI is trading at over $67 per barrel, levels not seen since 2018, and Brent is trading near $71 per barrel, levels not seen since 2019. Of course, the global economy was quite different only 18-24 months ago. There was no pandemic and there were greater numbers of people employed globally. Now, we are living in a pandemic world with lockdowns, restrictions, and millions unemployed. It would make sense in an environment of full or near full employment to see energy prices increasing. However, with so many people still without work, it becomes a little more of a head-scratcher. That is, when analyzing the energy market from a demand perspective. However, if looking through the lens of inflation and inflationary pressures, then it makes complete sense to see prices rising across the commodity spectrum – from energy, to industrial metals, to agricultural goods.

You see, there is no free lunch and there are consequences to printing trillions of dollars, euros, yen, yuan, et cetera globally. Now, once economies begin to re-open and restrictions are lifted, there is likely going to be a rush of people who want to go out and attempt to live as they were prior to the pandemic. This is understandable, yet this will contribute to the price increases, as inflationary pressures are met with demand for goods and services. And on the other side of the equation is supply. There remains supply chain disruptions, geopolitical risks, and production levels of OPEC+ that will likely contribute to energy prices remaining at elevated levels for the foreseeable future. This will squeeze corporate profit margins for small, mid, and large firms, and also squeeze the consumers’ balance sheet as well due to higher prices. As we stated last year, free was never so expensive! And we are about to find that out the hard way. Stay diversified, stay vigilant, and stay with The Kapital News. #Economy #Oil #Inflation #Gold #Silver #USA #Liberty #EndTheFed #bananarepublic #FireCongress #Leadership

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