Saturday, November 11, 2006

One month after the Dow Jones index shoot pass 12,000, I can still see the stock market going in no direction. This got me thinking? Shooting pass the 12,000 historical milestone is something worth celebrating for, but yet I can see the market having bull and bear run every alternate day.

So, what does that mean? Its pretty obvious that the market is just unsure if its a bull or bear. They know they have to shoot pass the milestone, and yet they are just usure if thats the correct path to go.

The other thing i notice is the oil price. It has always been a concern to every politican in every part of the world. WHY?

The reason is very simple. If the oil price goes up, those big companies would have to use more of their money to buy oil from producing goods that you and me use every day. So, which means their profits goes down.

If their profits goes down, does they have extra money to go into research or improving the skills of their employee? The answer is NO.

Since they don't have enough money to for all these small improvement in company, how can they able to recruit more people to help in the company? Which means more people might get retrench in order to reduce the cost of the company.

When more people are retrench, they will not have enough money to spend and the CPI, will drop. So does that affect the politician? Yes. Because they will need to report to their people regarding all the GDP, CPI, PPI and whatsoever.

SO now you can see the whole picture on why every people is talking about oil price and what has oil got to do with the government and us.

The lucky part is, nowadays oil price is low, and the OPEC has decided to cut down production to increase the oil prices. Trust me, I don't know why they want to do that, I am also looking for an answer.

But,many believe the oil price will start going up this quarter, because of the cold winter, and lesser supply of the oil.

I shall keep my finger cross and see whats next. : )

No comments: