Fed meeting on Wednesday.
Trump didn't do anything too crazy over the weekend (but Turkey did), so we haven't got much to do while we wait for the Fed to officially raise rates 0.25%. Oil's fall is calling a big stir in the news but it's hardly news to us as we were shorting it all the way to our goal at $48.75 and now, at $48 (/CL), we're more interested in finding a bottom while everyone else begins to panic. So far, so wrong on Gasoline (/RB) and we've tried to play that long off the $1.60 line and now $1.58 but we're sticking with them as refineries are rolling over to summer blends and production goes off-line.
And yes, by the way, the analysts you are seeing on TV and reading in the MSM all know that the refiners roll over every spring and that this week is always the peak of inventories (see chart above) but they are not giving you that information because it doesn't fit the narrative of getting you to panic out of Gasoline ahead of the summer driving season (May) because the Wall Street Criminals these analysts work for want to buy into Gasoline for as little as possible and, to do that, they send out their lackeys to push your panic buttons.
Gasoline fell to $1.525 last March and stayed low into April but then topped out at $1.80 in may. 27.5 cents up on a Gasoline Futures Contract (/RB) at $420 per penny is a gain of $11,550 per contract, which is why we began buying at $1.60, though we're happy to buy more if it gets cheaper – we just don't want to miss the fun!
Speaking of fun, this chart from BAC/Merrill sums it up nicely for the human race – game over!
1. Long Robots, Short Humans
"You can’t build a wall to keep the robots out"
- Number of global robots by 2020 = 2.5 million; in 2010 was 1 million
- Until we “tax the robots” (which we are likely to end up doing) Disruption, Demographics, Debt likely caps rise in inflation & interest rates
- The “deflationary D’s” won’t prevent cyclical rise in inflation; but are likely to prevent a secular rise in inflation
Now, you may look at those numbers and think 2.5M robots is not that many but, sadly, that's because you don't know how fast technology ramps up. Robots replace workers and save the buyer (who has access to capital) money over the course of their "lives" so we can expect more rapid adoption than say, Autos, which took about 25 years to catch on and then voom!
Imagine our children, in 20 years, watching the influx, not of immigrants but of robots – replacing their jobs one by one, relentlessly, for the next 20-30 years. Our grandchildren will barely know what a job is – if, of course, they are allowed to live, that is. Not by the robots, I'm sure they will be very nice – I'm talking about people who own the robots who will, of course, have all the money and will have to decide whether or not our grandchildren deserve to live in their world.
Obviously, we've just voted for the robot-builders and hopefully their treatment of immigrants and the poor is not a good indication of the indignities they will heap upon our grandchildren though, honestly, what will the point be to their lives if they don't work, right? People who don't work and can't afford to take care of themselves are society's garbage – even if there are no jobs because they are all being done by machines – it's their own fault for not educating themselves and buying their own robots.
What do you expect the robo-job creators to do, take care of the non-workers? That would be ridiculous but, if we give them huge tax breaks that allow them to buy more robots – I'm sure they will create some human jobs as well. It's only happened once under a Republican President since 1920 but hey – let's keep trying the same thing over and over again!
If we do not start rethinking the entire concept of wealth and labor in our society now – BEFORE it is all confiscated by the Top 1%, then our grandchildren will effectively be born into lives of poverty – unless they are lucky enough to be born into a family of robot-controlling overlords, in which case they will be set for life. Last year, I would have told you that we need to vote for people like Bernie Sanders, who understands that our entire system needs to be questioned but, seeing how many people are voting for their own oblivion – my recommendation is to be a robot owner.
We're probably the last generation that will actually be able to simply decide to invest in the companies that will ultimately control the World. You can see their grip tightening as we speak. There were 8,000 publicly traded firms in the US in 1997 and 20 years later there are only 3,700 – that's 50% less stocks that the public is allowed to buy.
Intel (INTC) is buying robo-car tech Mobileye (MBLY) this morning for $15Bn and we will see more and more of their mega-deals as the Global end-game of Capitalism begins to play out. As with Highlander, in the end – there can be only one (worker)!
So of course you elected a guy who will dismantle the environmental regulations and bring manufacturing back to America now that those factories can be built free of those pesky workers and super-profitable (with low taxes too!). It's what they call selling you a pig in a poke and you fell for it hook, line and sinker but, sadly, it's your Grandchildren who will suffer from this folly – unless Global Warming gets them first…
Happy Monday!
– Phil
