After 4-month surge, gas prices start falling

LONDON — Brent crude surged to a six-month high on Wednesday as western countries prepared to attack Syria, raising concerns over the security of oil supplies across the Middle East, which pumps a third of the world’s oil. The United States and its allies are readying for air strikes against the forces of President Bashar al-Assad, blamed for poison gas attacks last week. But the timing of any action was unclear.

Never mind the 1980s, you have to go back to the Labour government's income policies of 1977 to find a time when household incomes have been as squeezed as they have been in the past year.

This is the first real good news I've seen in the housing market:  rental rates finally seem to be stabilizing.  Rents rose in 60 of the 79 metro areas tracked by Reis, a real-estate research firm.

The stock market has been weak lately, and commodities have been getting crushed. Does this mean that the global economy is really slowing down hard? Maybe. Recent U.S. economic data has been disappointing, especially in the realm of housing, which is what the US bull case is all about.

A curious thing happened last week. The prices of both monetary metals have been falling for a week and a half through February 15. No, that’s not the curious part. There is no law of nature that says the prices have to go up, but if they go down it must be artificial somehow. The curious thing is that the price fell while open interest in futures rose, which is not typical of how the market has actually been behaving in recent years. Now let’s look at the data.  

Despite being weeks away from the start of the driving season proper, gas prices - at the pump - have been surging recently. With premium now over $4 nationwide (over $5 in SoCal - up 25 days in a row), this is the most expensive gas has ever been for the second week in February despite gasoline being relatively well supplied.

The chart above shows the annual growth rates in: a) consumer prices (CPI),

The meme of the moment appears to be that sliding gas prices (which by the way merely fell back to mid-February levels) will no longer hamper the over-taxed and under-incomed consumer providing yet more upsided-ness for stocks. Sorry to burst another fictional bubble but Gas prices have now risen for the 3rd day in a row as RBOB (wholesale gas prices) surge to new 2013 highs and crude oil prices push back to one-month highs. Perhaps that is why today's retail sales data (unadjusted) is not providing the pop that so many talking-heads believe is warranted.