Posting all kinds of colorful charts, is not my cup of tea, being that I’m a “low-tech” kind of guy. It’s also Halloween, which is irrelevant to this discussion.
But for those of you who want to see an interesting phenomenon, compare the charts of the Nasdaq tech bubble to crude oil recently.
Even though eight years apart, if you “normalize” the starting year for the Nasdaq as 1988, and use 1996 as the start for the run up in crude, you will see a striking correlation (over 90% just eyeballing it).
Oil has now lost over 54% from the July peak.
Energy stocks have now lost almost the same amount as they did during their bear markets of 1980-1982 and 1973-1974.
If crude oil continues in a similar correlation to the Nasdaq bubble, it should settle in just under $50 a barrel.
Just for S&G’s, it would be interesting to compare the bubble patterns for different asset classes, to see if there is a general correlation in time and magnitude.
But, I’m out for most of the day and I’ll probably forget about all this. Off to pick up some silver bullets and holly steaks [sic]. I hate Halloween.
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