What is our economic future exactly? In 2002-2003, with oil prices rising and aggressive interest rate lowering then the obvious assumption was to invest in energy and metals. Back then China was building itself for the Olympics and the BRIC trade was another obvious assumption. So now we are in 2008....interest rates are not going lower, the Olympics is almost over... Tell me what the future will bring. Give me your thoughts and ideas....Lets discuss...
With the fed funds rate at a negative real rate, and expectations of at least 6 more months of it, and a huge bailout of the banks, I would think there is going to be a massive credit bubble formed again very soon. The question is where? Banks will shy away from anything to do with residential and commercial construction. So, where else? Government infrastructure programs. We have a massive need for infrastructure work in the good ole US of A. And banks will want to finance anything backed by the government for the next few years. Also, defense will be huge. We are only at the beginning phases of the Pentagon's ultimate goal of having defense systems all over Europe and the middle east. And don't forget energy. People tend to forget quickly that crude is still at 113-115, which is still very destructive to our economy. There is going to be a massive shift to alternative energy sources in the US. Take a look at synthetic fuel manufactures. They can create diesel fuel from natural gas and coal..etc. The story is not over, it has only begun. Inflation is still going to be a huge problem going forward, this is not the end.
Since I can only push buttons for myself, my economic future looks wonderful. I am 3 years from retirement, when I turn 45. Only took me 20 years to discover futures and another 5 to become profitable. Damn, who is selling that time machine? America IMO has had it's best day. I doubt that either candidate will bring the country out of recession for a few years, but long-term I don't see us ever returning to the greatness and economic powerhouse we were when conservatives ruled government and when government kept its priorities out of people's lives and in priorities of national defense, the gold standard and interstate highways. China has too much momentum to ignore as the new economic power. I have been watching the Chinese stock market for fun. The strides made lately make me think they will pass the USA in terms of economic opportunity for traders by 2015. Make your money now, gentlemen, and put it away for the long haul.
3 years from retirement, 3 years from death. I enjoy working everyday because it keeps me challenged. When you lose that challenge, you die. Most of what you say sounds ideal in theory, but is not able to be put into practice. What happens when you stop working? You die. China is clearly in a bubble that cannot be sustained. Most of the rhetoric I hear is just like 1920s era logic. I see China going through a long drawn out 1930s-like depression before any move higher. I heard all bearishness for the economy from 1980 until 2000. When everyone finally went bullish is when everything went to hell. Now everyone is bearish again which means long term the future is bright. It doesnt make sense, but it will in time and retrospect...
I have much larger challenges awaiting me after I retire. My plan is not to sit in a recliner and grow fat(ter). China will not see depression because its economy is based on socialism instead of capitalism, but they will see ups and downs like any communist country, more tied to resources than trade. We must go from bullish to bearish or the market would be one straight line, no volatility, and what kid of fun would that be?
What I have found interesting regarding the subjects of China and oil, or perhaps China and manufacturing and needing oil is the fact China is building a smelter in Saudi Arabia, bringing 500,000 jobs to the area. Smelter is not a term heard much in the USA anymore but gee whiz, the job creation is something we could use. My point is that rather than import the oil to China, China is bringing the process to where the oil is. Maybe global growth will incubate in the Middle East. We may have the mentality that China is our next insatiable consumer but China has other plans.
Do you scalp very short time frames or trade a bit longer, maybe 10 minutes to an hour? What is your favorite futures to trade? Thanks for the insight