Regarding “how low can they go?” my comment from another thread.

“Interesting indeed. Even more interesting, I can’t think of a single “expert” who has actually made this “prediction.” David Wolf from Merrill Lynch and Douglas Porter from RBC have both suggested that there are similarities in the ways in which the two major markets are unfolding but both economists went out of their way to stress major differences and doubts about whether it would occur. ”

I agree completely with your point. It’s difficult to wrap one’s head around this idea, but stranger things have happened.

And it’s worth noting that a target of $169k still represents a 21% increate from October 2005 values. Who posting here has had their wages go up 21% in the last three years? Not me, yet I still consider myself quite fortunate overall.

While looking at that one, I saw this article in the sidebar:

Saskatchewan, get ready for economic pain

http://tinyurl.com/9eb5ts

“[As] commodities’ valueSleep fall, it seems inevitable that the economic health of the province will soon tumble, just as we’ve seen all across the U.S., Canada and beyond.”

To be sure, there’s not a lot of substance to the article… but there wasn’t a lot of substance in the referenced Fortune article (Saskatchewan: Where Business is Booming) either. Just interesting to see that not everyone in the Fortune/Finance/Business sector is equally bullish on the province.

http://network.nationalpost.com/np/blogs/fpmagazinedaily/archive/2008/12/15/how-low-could-they-go-if-canadian-prices-follow-u-s-trends-certain-cities-will-experience-a-major-slide-in-house-prices.aspx

Saskatoon

Start date (Oct. 1999): $110,195

Peak: (June 2008): $310,386

Current: (Oct. 2008): $285,310

Predicted: (Oct. 2009): $169,480

With the economic uncertainty anything can happen.

You can pull up any chart and see what I mean. At first glimpse, the Potash stock chart looks similar to the crude futures chart. A big parabolic move to the upside and then a complete washout. Ugly.

My hat’s off to you folks continuing to buy stocks. I wouldn’t. This bear market has a ways to go still imho. And I’m not trying to be a gloom and doomer, just stating an opinion.

Sad it happened I know at the Vanscoy Agrium Mine over 300 got their notices for this February. But things can change just as quickly in either direction nowadays everything is changing one way or the other in lightning fast motions noone can predict it not even Buffet and he is my hero =op

http://www.thestarphoenix.com/business/Potash+production+hibernation/1094337/story.html

Were they not on strike for about 4 months this year and now they have to lay off 940 workers for 2 months? What if there was no strike, 6 month layoff?

I was pretty surprised by this number of people getting laid off for two months.

Good to see that positive attitude. You’re definitely right about gas prices. I went to fill my tank which was down to 1/4 last night and I had to force it to get to $20. That hasn’t happened in a very long time. It seemed like just yesterday i wasn’t even at half a tank and it would cost close to $35.

I also agree now is the time to buy stocks but I am greedy and I keep trying to get that tiny bit lower before i do. As i am waiting it quickly shoots back up 5-10% and then i have to wait again. Maybe i’ll dive in soon.

I also share your view on oil companies. You will probably see a few bigs swallow a few small ones as the little guys won’t be able to sustain these low prices.

As for today’s oil close of 32.80 that is artificially low as February’s futures’ price is already at $43. what do I mean artificial? At the end of the month you have several people trying to close out positions which tends to cause a rapid price change at the end of the month. However i really have no idea if it can go to $25 or not. If it does you will see more projects stopped.

Are prices getting pounded here yet? For the people that have to sell they sure are. There are lots of speculators (i mean lots) that refuse to lower their price but the people who bought first and can’t keep paying two mortgages have to take that 20-30k hit.

Not sure if or when we’ll see that happen there.

I changed my position from a large to a very small position in BQI as well in Connacher neither have more than $250′s in them and everything except the index money is in Suncor. If anything will happen out of this is that the juniors are gonna get hammered and the big oil is going to get bigger just like what happened with banking. Loss of XIU.TO(TSX 60) to date is 36.98% which is pretty good compared to some of the blue chips I was thinking of switching too. Im not sure how long this downturn in housing will last maybe 6 months maybe couple years but there is no other place I would rather be in the world with all of our opportunities. Merry Christmas or Happy Holidays to those who prefer that =op

Housing sales have fallen off a cliff. They may break 500 this month. Dec 07 there were 846 sales and the slowdown was already upon them at that time. Prices are 30k down yoy and 90k off the peak. Listings are still sky high.

http://www.findcalgary.ca/listings?pathway=127&pageId=19

I should have proof read that post. Sometimes I am thinking one or 20 things and writing another.

If oil hits 150 it will be a combination of oil’s worth increasing and the devaluation of the US currency. Personally, I think oil is good deal right now, great at $20. I am just waiting. Buy low, sell high, right?

have not heard from you in awhile. I am guessing you have shorted BQI. I have felt all junoir oil, gas and mining companies would take the biggest hit and the only way to make money would be to short them. Good job!

A few months ago when oil was at $90 a barrel, I said we would hit $35. ( It was a number based on inflation adjusted data over the longterm factoring in a worldwide recession. Granted, oil has other factors when it comes to pricing but usually not in a recession, just supply and demand) I did not think it would go this low, this fast, but it has. And I think it has further to go down in the short term. Single digits? No, but $20 a barrel is probably not out of the question.

In the next couple of years, if oil is still traded in US dollars, oil may break $150 a barrel, but not because of oil but because of the devaluation of the US dollar because of investors pulling out and inflation. The US fed has few bullets left and their biggest worry at the moment is that the printing press for money does not get jammed up. If and when the credit markets improve, inflation will be rampant in the States ( not sure about Canada, yet)

http://www.inflationdata.com/inflation/images/charts/Oil/Inflation_Adj_Oil_Prices_Chart.htm

All that aside I still own my house and I bought more stock I hope you all drive the stocks and houses down to pennies I will buy more than a few With that how long do you think oil will be this low and houses will be this low do you really think there is thousands of houses held by speculators? Did anyone hear about the mining and exploration tax credit to individual investors….well here it is

http://www.gov.sk.ca/news?newsId=ada232f3-c68d-45f9-97a8-f3ef64b8f312

And yes I bought even more stock I am in the red now and I think pretty much everyone is for this year thats for sure even with my winnings from BQI couldnt save me from the moderate lashing of the TSX 60. But I hope this happy news brightened som1′s day and next time you fill up ur tank I hope u smile because I did =)

“I remember a while ago you stated that there would be a time when US dollar would start declining against other currencies regardless the decrease in oil price. I used to think that whenever oil price declines, no matter what, the US dollar strengths. Do you know the reason why its happening adversley right now?”

The US dollar is going to lose quite a bit of value heading forward for 3 big reasons. Debt, inflation and trade deficit. http://www.iousathemovie.com/ will explain this well.

If I did say that the oil price would decrease along with the US dollar compared to other currencies, I may have to retract that comment because it would not make sense. Oil is traded in US dollars, so when the US dollar gets inflated and becomes devalued this will send the price of oil up even though if oil was priced to something such as the Can dollar the price of oil could have gone down.

Well, I know I’m not worried about deflation, depending on how you define it. I define deflation as an increase in money supply and credit. As far as I am concerned, low gas prices is not deflation–it’s just a result of money and credit going into the abyss.

Does anyone else has any idea? Please share if so!

I’ve been lurking here for a few months. So heck, I’ll weigh in:

From time to time, oil and uncle buck lose the correlation. what we may be seeing is more hedgefund liquidation in crude. and this weeks move in the buck was fear of benny boy firing up the printing press.

the big spike in the dollar index since august could be attributed to a shortage of US dollars in the system. additionally, yen purchases cause added currency volatility.

when cad/yen falls, the usd/cad pair rises. when aus/yen falls aggressively aus/usd falls too. the more the yen strenghtens against the us dollar, the more a particular pair weakens against the us dollar.

sorry to ramble on and hope it makes sense.

http://business.theglobeandmail.com/servlet/story/RTGAM.20081219.wcpi1219/BNStory/Business/home

http://www.thestarphoenix.com/Saskatchewan+population+grows/1095921/story.html

I have to mention there is plenty of anxiety from people who work in Oil and Gas…Usually the riggers and field guys go and then the office guys next. I have heard from several of my friends that their companies are now implenting hiring freezes. This includes my company and we’re not oil and gas.

http://tinyurl.com/4jvuvc

I remember a while ago you stated that there would be a time when US dollar would start declining against other currencies regardless the decrease in oil price. I used to think that whenever oil price declines, no matter what, the US dollar strengths. Do you know the reason why its happening adversley right now?

Does anyone else has any idea? Please share if so!

Trust me, I’m not in danger of getting sopped in any Kool-aid. I chose to come to Saskatchewan from BC, and believe me, my standard of living is far better here. I have not yet bought a house, as the timing still isn’t right for me. I completely agree that prices for many things, including housing, were based on wildly overoptimistic expectations of future revenue. Supply and demand will eventually work it out, but it will be interesting to see how exactly it plays out, for sure.

http://tinyurl.com/49pzsb

http://tinyurl.com/4v6ptx

“Potash Corp. of Saskatchewan Inc., the world’s largest fertilizer maker, cut its full-year profit forecast because the global financial crisis is slowing demand for crop nutrients.

Crop prices have fallen from records in June and July as demand growth slows for food, animal feed and fuel, reducing the incentive for farmers to buy fertilizer to boost yields. In response, producers of the crop nutrients have cut output.

“We believe global production curtailments — the logical economic response to supply/demand imbalances when buyers step away from the market — will significantly tighten these markets when demand returns, which we expect to be during the second- quarter of 2009,” the company said.”

This is unfortunate, but it sounds as if they’re being as flexible as possible under very trying circumstances.

http://www.globeinvestor.com/servlet/story/ROC.20081218.2008-12-18T200015Z_01_TRE49B3Y6_RTROPTT_0_CBUSINESS-US-MARKETS-OIL/GIStory/

Yikes!