The Friday Briefs

The Friday Briefs

The Friday Briefs
More good news this morning about the recovery in the United States: The University of Michigan/Thomson Reuters survey of consumer sentiment showed a 2.5 point rise to 89.4 in early November. This is better than expected and the fourth straight monthly improvement. The upcoming print issue of Wealth Professional will contain an interview with a fund manager talking about the recovery south of the border.

Some interesting stories that ran in the media this week…

Here are three pieces about robo-advisors and what these new companies mean for advisors…

How Financial Advisors can adjust to Robo-Advisors
The $7 Trillion Opportunity: Money Management Tips From The Financial Advisors Of The Future
Financial Advisors vs. Robo-Advisors: Which is Right for You?

There is a lot of talk this week about the new access to the Chinese stock market that is opening up on Monday…

This is an interesting article about the way the deep dynamics of stock markets have changed as a result of the increasing globalization of the economy. The shift in the global economy has led to changes in basic patterns in markets (such as the end of the old inverse correlation between the performance of stocks and bonds). Very interesting piece…

This is a good story about the effects regulatory shifts in Australia are having on the ETF market….

The IEA is assuming production of crude oil from the Athabaska tar sands will double yet. The agency thinks current rom production of about 4 million barrels a day will rise to over 7 mbpd. Fort McMurray is going to get quite a bit busier yet, apparently.

Many people are predicting the Shale Oil boom is driving the price of oil down. But the current low prices are going to be temporary. Here’s a story that points out the other side of the story—as prices fall, the frenetic and expensive pace of drilling necessary to keep shale production up will give way. Shale wells deplete notoriously fast. Companies have to keep drilling new ones or flows from a region gives way, rapidly. Shale wells are also extremely expensive to drill. And so, just as the peak oil types have long predicted, any decrease in the price of oil is going to be volatile. As prices fall, shale wells become unaffordable, the pace of drilling slows. The intensive drilling needed to keep flows up slows, production begins to fall. The price of oil will spike again. Or, to put it another way, the current lower oil prices are already creating the next lag in production and, hence, the next price spike… 

For anyone who had been playing the rare earth metals boom…it seems as if that whole thing is winding down