if you have actually been following some of the Tropical Storm weather guys like Dr. Jeff Masters, you would KNOW that the storm has been weakening and that winds are at Cat-2 (105 MPH) and that the eye-wall has shown a tear and signs of weakness. The NHC has elected to keep Gustav at a Cat-3 strength with their 11AM advisory, because the satellite appearance still supports Cat-3, as opposed to the Hurricane Hunter's planes that show it at Cat-2. There is also a decent amount of upper level winds that are creating 10-15 knots of shear over Gustav. From Dr. Jeff Masters: "By this evening, Gustav will be passing over a cold eddy. The heat content of the Gulf will decrease as Gustav approaches the coast. As seen in a simulation done yesterday using the GFDL model (Figure 2), the relatively shallow depth of warm water near the coast will allow Gustav to upwell large amounts of cold water from the depths. This will chill the surface waters down by up to 5°C (9°F), which should weaken Gustav's winds by about 15 mph. This cooling effect does not occur for Gustav's path over the southern Gulf of Mexico, due to the great depth of warm waters there. Both the GFDL and HWRF models respond to the lower heat content waters near Louisiana by weakening Gustav to a Category 3 hurricane with 115-120 mph winds at landfall. These models are the only ones that incorporate detailed depictions of the thermal structure of the Gulf of Mexico into their runs." http://www.wunderground.com/blog/JeffMasters/show.html
Aside from the human tragedy which nobody wants to see, hurricanes and other natural disasters are economically stimulative. Billions upon billions of infrastructure, housing, lodging, automobile replacements, consumer spending etc... Any selloff in equities in an event like this is temporary and time to buy the most direct beneficiaries of the stimulus. Too bad the mafia is not publiclily traded, they have their own disaster teams ready to come in and skim the whole process.
oil is more affected by the dollar nowadays. And with more reports this weekend about LEH being in talks with the Korea Development Bank, which if you recall resulted in a market rally and the sinking of oil by $6 on Aug 22, I don't think there'll be much of a pop.
nothing will happen regarding the storm oil is a screaming short now. this is not my favorite contract,but System says it goes down.
http://globaleconomicanalysis.blogspot.com/ ........many are anticipating a huge jump in oil and gas prices next week. I do not know if that will happen, but I will offer the opinion that if it does not happen, or if it happens and prices quickly reverse lower, they will keep going a lot lower than most energy bulls think. Short to intermediate term, it is highly likely that the slowing global economy will have far more effect on energy prices than peak oil. Just FWIW Steve
Just my opinion.................... The fact that the market did not zoom Friday when it knew there was a good chance the hurricane would hit the rigs should be the best indicator. Good luck to all longs - hope it zooms for ya! Steve