Shorting Crude (CLK4, 36.33) to complement USD (DXM4) long position
In brief, Bush’s most powerful political vehicle is the US Stock market. The means to a higher stock market is the short term interest rate complex which will remain unchanged this year, unless the DOW rises above 11K. Most relevant to this macro trade is the USD. The USD bottomed during the second week of FEB (long since FEB 17). Karl Rove cannot allow Crude Oil to remain steady/rise as the USD strengthens; this will undermine the global economy and, in turn, rile the US stock market’s ascent.
Crude are close to a crest. Recently, Chavez’s threat has been broadcast across the world, OPEC reiterated that it will stick to its supply cut, and Europe’s largest terror attacks occurred in Madrid...and crude did not make new highs.
Acts of terrorism benefit the incumbent party when they are aligned with the ‘War on Terrorism’; conveniently, early reports pointing to the Basque Separatist Group were ‘revised’ to Al Qaeda branding. Yesterday’s Madrid bombings officially launched the Bush re-election campaign. Now, the macro pieces touched upon above should begin to fall into place. Crude Oil is the single most important element to this global puzzle.


Posted by 7:54 PM