It's refreshing to eyeball the headline "Oil slips $9 a barrel in two days," even if it's predictably a very short-term easement from growing pains at the pump. There's been a lot weighing on the markets of late with the recent problems with Iran and continued pressure for more drilling, though by all measures demand for oil is dropping in the US. People are all but abandoning their SUVs and trading down to hybrids and smaller cars. The unfortunate downside to that that I can see is that say Ford, for example, will be pushing it's smaller cars, including reintroducing it's Fiesta brand small car. But that car will be made in Mexico, providing no benefit to American workers in Ford's SUV and large truck plants that face ongoing workforce cuts and plant closings. It's obvious Ford -as well as all US car manufacturers- have to make some very tough decisions to catch up to a monumental shift in consumer demand for cars and crossovers as opposed to trucks and SUVs, which were formerly US auto manufacturers' bread and butter. Converting their plants just isn't very cost-effective in an economic time such as the one we are in. Nonetheless, if Ford can sell cars it's good for the stock and good for the economy.
I still stand by my thought that oil will go yet higher before we see any real relief. There's just too much speculation going on, and the entire economy is still contracting. Unemployment continues to rise and though the dollar recently went higher, it's still not done with it's wheezing either. Last week I bought more shares of a stock I like, HQ Sustainable Maritime Industries (HQS), which I've been buying for a couple of months now and whose shares I think will be worth around $19 a share in the next 12-14 months. I've been buying in around an average of $13 a share. Essentially they deal in fish farms, primarily in Hainan, China, and they have extensive operations to include co-packing for companies that have distribution in places like Sam's Club and other large outlets. With mercury and other contaminants becoming a growing problem for non-farm-raised fish, demand for their products are good, and I see an opportunity in this current market to make some money there.
As far as my rebound picks I'm still looking at Target Corp. (TGT) and Visa Inc. (V). Right now Wal-Mart is doing very well as they still offer the best value for the money, and in this economy with budgets being squeezed to the hilt that's a very important thing. Wal-Mart wouldn't be a bad play for the next few months, but growth is an issue there. But I see Target as being the middle-guy. They are redesigning stores, upgrading product lines, and I think that when the economy rebounds people will see Target as a bit of a "step-up" from Wal-Mart. They should see some nice gains in traffic when the smoke clears. And of course, Visa stands to benefit from the increase in transactions people will make from the fees it charges it's terminal users. I'd hold off on buying either one until we see a real shift in oil prices which will be one main catalyst, in my opinion, for a rebound in the economy.
More Opinion by The Springboard
THE UPRISING OF THE AMERICAN PARTY "Clearly the voters are engaged right now, at least for sure on the republican side, and what they have concluded is that the republican party has not done their job. Thus, Donald Trump gets their vote."