And down we go

Yesterday the Dow fell 394.64 points.
The mood has changed to fear again.
Panic is still not here, but it will come soon enough.

We have been surprised by the strength of the April, May, June upwards move.
But gravity still works.

The Dow will fall considerably, panic will bring it down further.

Oil rose USD 11 yesterday to 138.54. That is a 8% leap in one day! 8%!
Yet the media keep explaining this with fundamentals, China, India, driving season etc.
As if the marked was efficient and this is all due to fundamental reasons.
There was nothing new yesterday, yet oil rose 8%.

The media never says this is hype, a bubble – sell! They just do not, it’s bad news.
No efficient market rises by 8% in a day at already mile high prices. Oil is in a bubble, big time bubble.
It will fall back.
How far? When?
There is still fear of war with Iran.
Perhaps we have to wait until the November elections for this fear to reside and oil to retreat.
Oil might reach 150-200 in the meantime.
There is much energy in a bubble frenzy once it has taken off, you can’t say how far it can go.

When the commodity bubble pops you will see the stock market AND commodities fall at the same time.

Keep in mind that money growth and money decreases are never evenly distributed.
We are in a deleveraging environment, less money.
But there is also new money at the same time.
The money statistics are averages, made up of many rising and decreasing money numbers at once.
Where is the new money going now?
What is the new money?
Is the artificial lending moves by the FED, preventing losses to appear, new money?
Anyway, it is my assumption that the new money is shy of the stock market.
Yet, somewhere it has to go.
It goes into commodities.

The Norwegian stock market will take a big time hit when oil pops.
This is why I have recommended not shorting Norway.
Norway is a bet on oil.
The general market in Norway has kept up due to oil as well:
So there will be a double punch down.
As oil now reaches unsustainable bubble levels it might be time to short oil, short Norway.

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