Oil still Struggling, NASDAQ to 5000

Oil fell down hard today after news of supply still overstocked. This was after a rise from the slump earlier this month. I still think that oil will go up in the long-run back to previous levels but it will be a volatile and rocky road there. I have enjoyed the cheap gasoline at the pump but know that it is a temporary price. A good move will be to take advantage of the cheaper gas now and invest in companies that have been hurt like Exxon and Chevron.

The NASDAQ is closing in on 5000 points around thirty points shy. It's very close to its all time high and one that has not been seen in fifteen years.  Apple has certainly carried it up to the heights it is at now. Once it passes this milestone again will it go up or will it scare investors that the market is overvalued. Earrings at record levels and good prospects on the economy this year point to a great sign that the markets will continue to go up and up. Companies are getting stronger and will attract people to invest in the market. I've invested in this market.

Oil's Collapse and Bad Calls

The recent 10% drop in oil prices now trading about $65 a barrel it means that all the big oil companies took a hit in stock price. Exxon itself took a 4% hit on Friday. This would be bad in the short-term for anyone who followed my advice to buy Exxon a few weeks back. I still think Exxon will recover and might even make more money on cheaper oil. It just hurts to look and see that drop in stock price in a day. This is why we as investors need a well-diversified portfolio. The drop would be bad but it would not hurt the entire portfolio. Just a small drop on a small percentage. Bad but not catastrophic. We try to avoid those when handling money. Also, another reason to diversify in industry and across the globe.

Exxon could still easily recover and I think they will buy back more shares at this cheaper price. They might make more too because consumers are used to high gas prices so there would be less downward pressure to lower gas prices as much as the drop in oil prices. Exxon will also make plenty of money from its large holding of natural gas. Those prices are up and it looks to be a cold winter which will be good for Exxon. It might be several years or it could be in a few months when it recovers. Still la great long term-play.

OPEC is trying to hurt the United States Oil production that is competing with it. I think some of the OPEC members though will not be able to handle this squeeze and will lower production to raise prices. They depend on that money and have gotten used to the high price. It must be maintained in the long run.

Busy Christmas Ahead Still

I was out shopping early this week and I have seen traffic and the stores busier than I can remember. Certainly busier than the previous six years or so. The stores do not have the big sales out yet but they certainly have people shopping. I think this is from several things. Cheaper gas prices have Americans in better spirits. They see more money in their bank accounts from slightly higher wages and more work hours. They also have lower credit balances which mean lower payments and they see that they can spend more. Americans still are not good in investing and thinking about saving. So more money earned means more money spent especially around Christmas.

As smart investors we should see this busy Christmas season and make moves into big retailers. They will have great earnings in January and February. Let's choose the good ones and take advantage before the price goes up in the future.

The Ever-Chnging Price of Hot Wheels

I work at a bank inside a Kroger and Kroger has conveniently placed a bin of Hot Wheel cars in front of the branch. They have changed the price repeatedly throughout the past three weeks, it ranges from a measly 79 cents to ten for ten dollars. I have noticed that the price is 79 cents when there is an abundance and ten for ten when the supply is limited in scope. I noticed though that there were more people attracted to the ten for ten than the .79 or .89 cent prices. 

Since it wasn't a randomized trial or a scientific study I have no idea why more people passed up on the better deal to wait for a higher price. More people could have walked by or there were more children in the store that day. It could be the best marketing around too. What I do know is that the price of the hot wheels seemed to have no other variable but the amount of cars in the bin. When more stock was added today the price decreased to .89 from one dollar. 

This is a classic case of supply and demand. Even in the tiniest toy there are still wide price swings when supply goes up or down. Maybe if the supply gets really low they will sell for 1.29. Paying attention to prices can signal to the consumer if they have a lot of toys or a limited supply at the moment.