Courtesy of The New York Times:
Light, sweet crude briefly touched $103.95 yesterday... its first
inflation-adjusted historical high since 1980.
In dollars, the 1980 high was just below $40 a barrel. But as you can
see, $40 ain't what it used to be.
"In 2007, the United States im****ted $331 billion worth of crude oil,"
comments our oilman Byron King, citing a Department of Energy re****t,
"at an average price of $64.25 per barrel. If the U.S. im****ts crude
oil in 2008 at an average price of about $95 per barrel, the annual
im****t bill could jump by about $150 billion or more, to $580-600
billion.
"That would be larger than the entire budget for the Department of
Defense.
"This hemorrhage of currency will, of course, negate any effect of the
Bush-Congress economic stimulus package, of about $152 billion
value."
Who could have seen that coming?
In kind, the dollar bled all day yesterday and into this morning.
The dollar index dribbled down to a new all-time low of 73.3. The yen
is still having its way with greenbacks... the Nipponese currency
climbed on top, to 102, during the night. The euro watched and enjoyed
its way further up, to $1.52.
"I think the only thing the dollar has going for it these days," says
EverBank's Chuck Butler, "is the hope that the European Central Bank
tries to play catch-up with the Fed regarding rate cuts. I don't think
the ECB will do that. But it will, most likely, cut rates this
spring... probably in May. So... When that happens, it just might be a
buying op****tunity."
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