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Evil Speculators Are Everywhere

By Jeff Clark
Thursday, April 19, 2012

President Obama is right. Evil speculators are pushing up the price of gasoline.  
What else can explain it? Demand for gasoline is way down. Inventories are way up. So common sense argues the price should be lower. But it's not. Clearly, it must be the evil speculators.
Those same demons were causing us pain at the pump last year as well. Take a look at this chart of unleaded gasoline...
The springtime price hikes last year and this year are almost identical. It was only after the president pointed an accusatory finger at speculators last year that gas prices started to fall. This year, he gave them the finger a month earlier. So maybe we'll have lower gas prices this Memorial Day.
Of course, the speculators aren't just hanging out at gas stations. Those evil-doers are all around us.
Look at the stock market...
The S&P 500 is 9% higher so far this year – which makes no sense at all. Retail investors have pulled $25 billion out of mutual funds so far in 2012, and stock exchange volume is 20% lower than where it was last year. How can stock prices be going up when demand is falling? It must be the evil speculators.
Precious metals prices are higher, too. Gold is up 6% so far in 2012. And the evil speculators have pushed silver prices 10% higher in the past four months.
But the worst part is those little demons haven't been confined to just the financial markets. They're everywhere.
My health insurance premium is 15% higher today than it was last year – even though I haven't been to the doctor in the past 12 months. My water bill is 12% higher this year, too – even though my usage is down.
The local dog groomer charges $7 more to clip Fido's nails. My wife's hairdresser hiked prices by 10% last month. And just last night, I shelled out $85 for a sushi dinner for two that didn't even include alcohol.
Those evil speculators are pushing up the prices of everything...  
... Except interest rates. Apparently, the little devils like cheap money. That explains why global interest rates look like this...
Only the combined efforts of the world's central banks can keep interest rates this low while the price of everything else is rising. So we know who the real evil speculators are... It isn't the traders and investors of the world who are scrambling to buy real assets with rapidly depreciating currencies... It's the central banks who are trying to paper over their debts and print their way to economic prosperity.
As long as interest rates remain artificially low, pricing pressures on everything else will continue to rise. At least we know where the president should really be pointing his finger.
Best regards and good trading, 
Jeff Clark

Further Reading:

Porter Stansberry believes what the Central Banks are doing – printing money to cover their debts – will result in a collapse of both the U.S. and European currencies. He calls it "the End of America." And it's a very real threat...  
"The End of America isn't 'out there,'" Dan Ferris writes. "It's right here, right now.The question isn't what will you do if it gets here, it's what are you doing now that it's here." See what important steps Porter and Dan recommend to protect yourself here and here.

In The Daily Crux
Market Notes
Health care stocks avoid the recent stock market weakness... Big health care fund XLV sits 2% off its all-time high.
"Inflation hedges" Hershey and Coca-Cola both sit at multiyear highs.
"Champion of Natural Gas" Chesapeake Energy breaks out to a two-year low... shares are down 50% from last summer's highs.
More than two dozen small regional bank stocks are up 50%-plus in the past three months.
Market Watch
Symbol Price
S&P 500 1385.14 -0.4% +6.1%
Oil (USO) 39.05 -1.5% -8.9%
Gold (GLD) 159.31 -0.6% +9.2%
Silver (SLV) 30.64 -0.5% -27.8%
U.S. Dollar 79.57 +0.1% +6.3%
Euro 1.31 0.0% -7.8%
Volatility (^VIX) 18.64 +1.0% +9.9%
Gold Stocks (^HUI) 446.80 -0.9% -22.5%
10-Year Yield 1.98 -1.5% -41.3%

World ETFs
Symbol Price
USA (SPY) 138.61 -0.3% +8.4%
Japan (EWJ) 9.78 -0.2% -0.2%
S. Africa (EZA) 67.19 +0.2% -0.9%
Singapore (EWS) 12.83 -0.2% -3.7%
S. Korea (EWY) 59.02 -0.6% -7.3%
Taiwan (EWT) 12.88 -1.1% -9.5%
Lat.America (ILF) 45.69 -0.7% -9.5%
Canada (EWC) 27.90 -0.2% -13.1%
China (FXI) 37.54 +0.1% -14.8%
Israel (ISL) 13.74 -0.6% -16.2%
India (IFN) 21.83 -0.6% -27.6%
Russia (TRF) 15.95 -1.0% -28.3%

Sector ETFs
Symbol Price
Retail (PMR) 25.91 +0.1% +23.9%
Big Tech (QQQQ) 66.61 -0.3% +19.6%
Consumer Svcs (IYC) 80.95 +0.0% +15.7%
Big Pharma (PPH) 73.61 +0.6% +14.1%
Utilities (XLU) 34.77 -0.2% +12.8%
Health Care (IYH) 76.83 -0.1% +11.5%
Real Estate (IYR) 61.90 -0.5% +9.0%
Industrials (IYJ) 70.29 -0.4% +3.0%
Defense (PPA) 19.81 -0.4% +1.9%
Transportation (IYT) 94.49 -0.2% +1.8%
Media (PBS) 14.79 -0.4% +1.3%
Financials (IYF) 57.18 -0.7% +0.6%
Software (PSJ) 26.59 -0.5% +0.3%
Construction (PKB) 13.79 -1.3% +0.3%
Insurance (PIC) 16.07 -0.7% -1.0%
Biotech (PBE) 21.50 -0.1% -2.5%
Water (PHO) 18.70 -0.6% -3.1%
Internet (HHH) 70.21 +0.1% -3.8%
Telecom (IYZ) 21.63 -1.1% -5.8%
Semis (PSI) 15.66 -1.1% -6.7%
Basic Mat (IYM) 69.78 -0.4% -9.7%
Oil Service (OIH) 121.00 +2.4% -11.4%
Nanotech (PXN) 6.24 -1.0% -32.0%
Alt. Energy (PBW) 5.14 -2.3% -46.8%

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