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03/02/11 ECONOMIST REPORT

03/02/11 ECONOMIST REPORT. Economic Indicators Recap. Rising Prices. Rising Prices – Middle East Effect. Oil futures rise to $102.60 (new high). Libya produces 1.68 million barrels/day. Gadhafi fighting protesters reduces output. World consumption = 87.5 million barrels/day. Rising demand.

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03/02/11 ECONOMIST REPORT

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  1. 03/02/11ECONOMIST REPORT

  2. Economic Indicators Recap

  3. Rising Prices

  4. Rising Prices – Middle East Effect • Oil futures rise to $102.60 (new high). • Libya produces 1.68 million barrels/day. • Gadhafi fighting protesters reduces output. • World consumption = 87.5 million barrels/day. • Rising demand. • Saudi Arabia countermove. • $3.09/gallon of gas.

  5. Rising Prices – Another Possibility • QE2 under way. • $600 billion currency infusion into economy. • Highly praise, now going too far? • Inflation fears. • Joneson, “Self-perpetuating upward price cycle could pull market back.”

  6. Effect on Industries • Discretionary spending decreases dramatically. • Restaurants historically hit hard by rising oil prices. • Popular stocks: oil, alternative energy.

  7. Looking Ahead… • U.S. government response to escalating violence in Libya. • Federal Reserve’s response to escalating prices in U.S. • March 4: Employment Situation. • March 4: Factory Orders. • March 11: Retail Sales. • March 16: Housing Starts. • March 17: Industrial Production.

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