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What’s Oil Got To Do With It?!, Phase 3

January 3, 2015

Submitted by Luis Daniel Cortes of

Since 2009, central bank authorities have thrown money at the private banking sector and the sovereign debt market. The Federal Reserve alone threw something in the order of $23 trillion at the private banking sector and central banks elsewhere have also thrown trillions of yuan, yen and euros.

What this did was transfer risk from the hands of the private banking sector and sovereign debt market to the front doorstep of those of us on Main Street. Anyone who has worked in selling insurance like I have knows that risk does not go away, it simply gets transferred to another party or parties that share in the risk.

In the previous post on oil, I shared how oil has been collateralized similar to home mortgages in the early 2000s and I offered an article that illustrated what the drop in oil prices has done to holders of junk bonds and other debt-derived “assets” backed by oil.

Although there has been plenty of private investors who have suffered from the drop in oil prices, the one entity who has a lot of skin in the game and stands to lose big is the nation-state of Venezuela, who happens to already be the leading candidate for a currency collapse. The drop in the price of oil could only aggravate their currency crisis. The news media here in the United States has been silent on Venezuela’s currency crisis, but they have reported on Russia’s ruble which is currently in a free-fall due to the lack of oil revenues.

I did say at the end of my first post on this subject that I would concede if I did see where the dire consequences to the drop in oil prices would lie.

Are there any dire consequences to those of us on Main Street here in the United States? If so, they have yet to be seen or predicted.

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And like most of you, the way I’ve moved toward my goal has always hinged not just on having a job but a career.

You don’t have to be a self-published author to know that “having a job” and “having a career” do not mean the same thing today as it did when I got my first job fifteen years ago.

Even the basic concept of “getting a job” has changed so radically that jobs–getting and keeping them and the perceived lack of them–is the number one topic among friends, family and for that matter, complete strangers.

So I sat down and wrote this book: The Era of YIPS: Your Interdisciplinary Problem Solver.

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// Widgets

HUGE GIANT BIG FAT DISCLAIMER: Nothing on this site should be construed as investment advice or guidance. It is not intended as investment advice or guidance, nor is it offered as such.


From → Economics

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