Behind the Headlines

Trucks, Trains and Gains

Stephen Leeb
Friday, January 30, 2015

The U.S. economy is undergoing a significant transition—from consumer-driven to trade-driven. The shift puts the spotlight on two sectors:  transportation and infrastructure, both critical to support the burgeoning trade between the U.S. and other nations.

From World War II on, consumer buying propelled growth, accelerating from about 60 percent of GDP in the late 1960s to a high near 70 percent early this decade. This, however, will likely mark the peak for a long time to come as the remnants of the baby boom generation march past the age of 50, typically when personal consumption... Read more about Trucks, Trains and Gains

The Real Reason for $50 Oil

Stephen Leeb
Friday, January 23, 2015

Talk about oil these days frequently focuses on its extreme sensitivity to supply and demand. Between 2011 and 2014, worldwide demand for oil increased by about 3 million barrels per day, despite a decline of one million barrels in European demand. During the same period, non-OPEC supply increased by a little less than 4 million barrels a day. Production from fracking and other non-conventional oil in North America accounted for over 100 percent of the gain as production for other non-OPEC producers declined slightly. In other words, for the oil market to have stayed in balance, OPEC... Read more about The Real Reason for $50 Oil

Our Predictions for 2015

Stephen Leeb
Friday, January 2, 2015

As we enter 2015, we think a case can be made that the next 12 to 24 months will go down in history as the most important in the history of capitalism and the West. As it stands now we think—and desperately hope we are wrong—that the period immediately ahead will be one in which the East establishes itself as at least equal and probably more than equal to the West. It could easily be a time in which the dollar’s days as the world’s reserve currency clearly become limited. And it may be a period, as we explain below, in which that ever-narrow tight rope the West has walked between inflation... Read more about Our Predictions for 2015

How to Profit from Trough in Oil

Stephen Leeb
Monday, December 8, 2014

The sharp fall in oil prices engineered by Saudi Arabia will likely be fairly short lived, and indeed sets the stage for the next major rally in oil prices. Though oil prices could stay at or well below recent levels for at least another 6 to 9 months, within the next 12 to 18 months, odds look much better than 50-50 that oil will spike closer to all-time highs than languish at current prices. The Saudi actions will have significant short- and longer-term economic and political implications; these could prove foundational vis-à-vis how to position your portfolio. Shorter term it brings us... Read more about How to Profit from Trough in Oil

Ditch and Switch: What Turmoil in Oil Means for Stocks

Stephen Leeb
Tuesday, December 2, 2014

Is the recent tumult in the energy sector a sign that investors should flee energy stocks? The quick answer is no. The turmoil does, however, give investors an opportunity to ditch some of the weaker and more poorly positioned players—mainly companies whose operations are concentrated in North America—and switch into the much stronger international entities.

In most cases this means shifting from producers to service companies and in particular getting out of companies in the business of domestic nonconventional oil production, aka the frackers. Even more critical to avoid are... Read more about Ditch and Switch: What Turmoil in Oil Means for Stocks