Originally Posted by
full of luv
I don't think you understand the factors that drive the price of fuel.
At the end of the day, it's a supply/demand problem that is truly unaffected by any election.
If high fuel cost is driven by excessive demand, well then business is good and everyone prospers (at least temporarily).
If high fuel cost is driven by strife and restricted demand (ie embargo) etc, then that will be problematic for the whole economy much more quickly.
Chances of the first happening seem really low due to worldwide economic slump at the moment.
Chance of the latter seems somewhat remote as many parts of the world are now producing oil and are eager to sell due to waning budgets.
I think it's yet to be determined that ULCC's will "thrive" in a "high fuel cost market" as that generally affects the budget conscious / pleasure traveler even more than the business market, but both are affected.
Also, when fuel is high, market priced labor is less of a piece of the cost of producing the widget than having sub market wages as the high fuel cost overrides all.
Bottom line, high fuel is not really good for anyone in this industry, and IMO would affect the ULCC's as well. I guess we'll see if your hedge on the industry is correct (well after your predicted fuel spike in November anyway). Best of luck to all of us.
Wow, why are you on APC instead of auditioning for your own "Mad Money" show?!
So the stock market is effected by supply and demand? I had no idea. I also had no idea that oil companies, Wall Street investors, or any other special interest group have no interest in the presidential election outcome - that's a relief!
I always thought (in agreement with many published analysts) that equities tend to drop in the end of a president's term.
Here's one article, this author obviously is a moron. Maybe you can help get these people fired, I have faith in your resourcefulness.
[URL="http://www.cnbc.com/2016/01/13/why-markets-tend-to-fall-during-a-presidential-election-year.html"]
And this fellow is predicting "an overdue" rise in oil prices after the 3rd quarter but not because of some huge surge in demand that means "business is good and everyone prospers" or "strife and restricted demand." Instead, he notes that massive consolidation and huge production cuts in the U.S. oil market, and the continually increasing import of foreign oil. What an idiot!
http://oilprice.com/Energy/Energy-Ge...Will-Rise.html
I'm glad I have you around to explain to me how fuel pricing works! I'm sure DrJekyll feels the same way!