Blog : Gas is About to Cost You More
by Peter Leeds on February 17th, 2015
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In this penny stock blog:
- Why gasoline will cost you more
- 3 other hot spots will affect you
- Guess when Greece runs out of money...(sooner than you think)
Gasoline Will Cost You More (thanks Libya!)
We previously told you in our penny stock blog that Libya is not a centralized nation. Much like Afghanistan, Libya is a collection of over 100 different tribes.
They fight each other, have scores to settle, different religions, and different ambitions. Most of them are also pretty well armed.
We mentioned 'civil war' post-Gaddafi a couple years ago, in our penny stock predictions. We also said Greece woule leave the Euro, but to be fair we also expected Romney to run on a ticket with J.C. Watts. Quite frankly, we are surprised it has taken so long for Libya to enter civil war.
An oil pipeline was the target of a terrorist explosion a few days ago. This has instant and direct effects on oil prices, and underlying penny stock investments we follow. Expect to see more of these type of attacks.
Meanwhile, National Oil Corp. operating in Libya has mentioned they may be forced to shut down ALL activities in the Nation, in order to protect the lives of their workers.
Libya used to be a massive oil producer (in the Gadhafi days) of 1.6 million barrels per day. Right now it has dropped to 200,000 a day, and we expect that number to fall even further.
Other Hot Spots
Yemen is collapsing into chaos. Shiites are taking over much of the north (so far) and moving south. This will not affect oil directly, but it will indirectly. The Shiites (loyal to Iran) need to establish another satellite state, now that Syria has descended into chaos.
Iran is holding sway (and providing clandestine support) to nations, such as Palestine, despite America's best efforts to destabilize all Iranian allies.
Venezuela is on the verge of an uprising due to the currently low oil prices.
Ukraine civil war is not nearing an end, but rather has been getting more serious with each 'peace talks' attempt.
All of these global issues are adding price premiums on things like gold and oil (which you won't see on days like today, due to strengthening of the American dollar).
However, when the U.S. dollar is not on such a hot streak, you'll see more of an impact. This will beneficially lift several of the penny stock companies we are following.
Why Greece Matters to You
Greece, with the election of Tsipras, has been uniting against painful austerity measures imposed upon them by the European Central Bank.
Basically, the EU says Greece is spending way too much, so if they want ANOTHER massive loan to keep their economy going, they have to give up even more of their Nation's valuable assets, and suffer further austerity measures.
The soft deadline to reach a deal was yesterday, and it came and went. Greece needs a deal, or they run out of money in March. In other words, they would have to default on their debts.
This matters to you, and every penny stock investor, since any scenario could topple the markets (affecting both blue-chips AND penny stocks):
- Greece defaults
- Greece leaves the Euro
- Greece takes on more EU debt
There are no other potential outcomes, except ridiculous discounts on the amount owing to the EU. Pay down your alcoholic cousin's debts, and see how long until he has just as much debt again. If you don't know how long it might take, then you've never lent money to a family loser (I mean family 'member').
This will encourage Spain, Portugal, and other marginal EU players to follow the same path. The Euro would be in jeopardy.
The worst case for France and Germany would be if Greece returns to the Drachma (their dollar) and 'survives.' That could mark a mutiny of several EU nations who are getting restless.
As of January 2017 we no longer publish the blog and it has been removed from the webiste menu.
You are reading this old blog entry because we still like to reference it. :-)
You are reading this old blog entry because we still like to reference it. :-)
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