HUGE ECONOMIC NUMBERS SPELL B O O M OPEC & RUSSIA SAY NYET

These numbers tell a story of a boom. There is a possibility that the market may sell off tomorrow on a very good jobs report. This is because everything is IN the market and decreasing unemployment would just verify the data. These numbers are so good that many economists are predicting a possible 7% growth rate for the fourth quarter, a virtual job creating machine. Intel reported they are astounded by their own sales, up 10%.

Best Overall Car Sales Since Oct 2001

Projected car sales of 19.1 million units This is incredible. Problem lies with GM and Ford; everybody else is making a killing. Big Q out there is still: Can anybody with a UAW contract make any money? The rest of the data:

Non mfg employment index up big
August new orders index up huge
Factory Orders up 1.6
Factory Orders,Ex-Defense up 1.9
Factory Orders,Ex-Trans up 2.1
Durable Goods Orders up 1.0
Non-Durable Goods Orders up 2.4
Machinery orders up 1.5
Computers and Electronics up 1.5
Factory Shipments up 2.5
CONSUMER GOODS UP A STAGGERING 3.7%

The road goes on forever and the party never ends BUT

OIL & ENERGY seem to change each day. New supply is ready to come on line out of the Atlantic basin and elsewhere and, coupled with rising capacity within OPEC, could exert severe downward pressure on prices. This means the poorer nations in OPEC like Nigeria cannot live for long with the reduced pumping. All cartels collapse eventually and this one, even with the addition of the Russians, may fail, again. BUT....AND THIS IS BAD

OPEC combining with the Russians for just this winter could wreck our recovery. OPEC will not increase production, preferring to keep oil prices above $30. This not only means high gasoline prices, which are not that big a deal to most of us, but ruiously high heating oil and natural gas prices. The natural gas problem is of our own creation because drilling should be going on right now but environmentalists have blocked it.

October crude is below $29 and cash OPEC is close to $27. Gasoline is down as well so there will be a little relief at the pump starting this weekend. However, the back months: November December etc. prices are way up. back months are now down. They are rising out in April. Natural gas is moving higher on all winter contracts starting with December, roughtly 2-1/2 times normal. And Bush is on vacation. Late add @1:30PDT API reports a slight build in crude and no change in gasoline stocks, mainly because bad weather curtailed Labor Day Weekend driving. Good for gasoline prices which are 2.03 low end in LA today (36 cent tax added here).

There is a trading opportunity here in the energy complex for traders

Watch what the White House says today because they get the unemployment data 24 hours before it is released.