Aaaarrrrgg-entina!!! - This time we're crying

Aaaargg-entina!!!  If they were to make a musical about the country now, it would be called Evicta and this time you're the one making everyone else cry.  The drama right now has to do with the Argentinian government's plan to take control of the country's biggest oil company YPF.  Except, YPF is majority owned by Spanish Repsol.  Poor Repsol - they are basically getting chased out of a company they own.  And understandably they are plenty pissed off about it.  It gets even more dangerous as everyone starts to second-guess their Argentinian investments.  Hard to blame them, right?  Would you be invested in a country where someone can just take away your ownership rights?

Couldn't come at a worse time for Spain with their financial problems now economic Ground Zero.  Frankly it actually looks pretty bleak for Spain right now.  That said, I've spent quite a bit of time holidaying in Spain and it never ever feels bleak.  Guess that's what the combination of good weather, great food and attractive people does.  I've never been to South America but hope Argentina has the same going for it because they are struggling to win friends right now.

Admit it, you've been splurging!! :)

Who’s the most obnoxious TV personality?  Well, I'd bet Jim Cramer on CNBC could compete.  That said, I appreciate his passion for markets and I watch his show Mad Money often enough.  Recently he did a 'Oils well that ends well' segment and I agree. It would be really bad for everyone if the recently revived US consumer gets crippled at the pump.  A lot of the global economy is banking on him to take that cruise  to Hawaii and return with that Chinese-manufactured ‘Waikiki Beach’ T-shirt.  He is absolutely right gas at $5/gallon is a problem. 

Everyone's worried because so far the United States of Consumers has not disappointed.  Incidentally Tuesday was judgement day for this.  Saks, Macy’s, Home Depot and Walmart all reported earnings.  I hope 'The Birds and the Biz' followers can guess what happened.  Home Depot had strong numbers (see US housing posts); Sak’s and Macy’s both beat (remember that crazy Sak’s shoe-page?).  Meanwhile Walmart (with those crazy post thanksgiving mobs) disappointed on heavy discounting.  They were basically selling a $5 DVD player and then throwing in the complete box set of ‘Saved by the Bell’ for free!   Also, bad news for recession-istas who mastered waiting for the sale – Sak’s CEO said full price is coming back.

Damn!...just when we were getting accustomed to discipline and restraint.  You see, one of the casualties of the 2008 financial crisis was conspicuous consumption.  Recession-istas became regular Vogue vernacular and home austerity measures were sources of pride and delight.  Particularly on a trading floor where men (intentionally sporting last year’s Brooks Brothers) proudly boasted of their wives' newly frugal ways.  Those who didn't accept the new normal bordered on ridiculous.  For example, Paris Hilton frocked head-to-toe in Gucci looked outright stupid (I saw her in Aspen this year and she doesn't carry her own skis!) while Kates (both Moss and Middleton) in Top Shop brimmed of style and good taste.  

But seems we’re all kidding ourselves and hiding a few 'harmless splurges' from our husbands/boyfriends.  Sorry, the secret's out.  Nearly all of the high-end luxury retailers reported awesome numbers  (LVMH, Coach, Richemont, Burberry, Feraggamo, Michael Kors) with plans for expansion.  Indeed a lot of Chinese blinging-out but numbers were solid all-around.  Think the Gucci brand was the one exception but (yuck) Paris wears a lot of that!  

OIL - As Clear as Black Gold

UUGH..NY Post used this ‘Pain in the Gas’ pun that I wanted to use today.  Also, sucks to write this when yesterday’s entry had me browsing through women’s porn (luxury US real estate websites) while today I’m googling gas prices. Sigh!  But, markets (like life) can’t always be sunshine and rainbows so today will be a bit less shiny/happy.

OIL - Tough post for me today but FULL DISCLOSURE I'm no expert.   Meanwhile, oil ranks alongside God, War and Sex as most debated/complicated three letter words EVER.  Start by knowing U$100 per barrel is a closely watched level.  Recently oil has cruised through U$100 to U$105.  This is where it gets uncomfortable and also receives a lot more attention (like the boy who still hasn't called since your date ten days ago).   Main issue now is escalating tensions between Israel and Iran over the nuclear situation.   And everyone’s involved. Latest is Iran stops oil sales to France and UK after EU tells Iran ‘Listen, you're nuke program is sketch .'  US obviously runs an even harder line with them.  Unfortunately this drama comes at a pretty lousy time because gas has already started to get pretty pricey in US (for Feb prices it's a record).  I don't drive (Asian female joke here would be very ill-timed), but I bet all my friends who ‘pay at the pump’ feel the pinch.  Not good, as US economy really can’t have you scaling back - they need you splurge on those Doritos and People Magazines!

Little is clear-cut about oil.  In fact, rising oil prices aren't even always  just ‘Bad’.  Naturally happens when world is growing (and simply using more of it).  And then it also happens in times of rising Middle East tensions which is why it soared on September 11.   Currently I guess it’s both.  Really  wish I knew how current oil predicament resolves itself (I'd be sporting a Nobel Peace prize and my readership could go VIRAL).  Sadly, I don't.  Worst case, there's a war between Israel and Iran (NOBODY WANTS THIS!)  If this happens, close this blog, put on a khaki safari shirt, buy bottled water and follow Christiane Amanpour. 

Seriously, oil price debates last days not hours (which we don't have).  However, it's fair to say world economic recovery is tested if they stay at all-time highs for a prolonged period.  Few glimmers of hope.  Peace in the Mideast?  Ok more realistic.  Americans (the biggest consumer) isn’t as dependent on importing oil and in 2011 became a net exporter of for first time in 62 years.  Shale oil drilling has helped here which is not without its critics.    Other reasons include: huge Brazil reserves (we talked about this yesterday..Brazilians are so lucky!) and other energy sources (Yes, everyone loves solar but the more controversial liquefied natural gas).

Omg - I have to stop there - I am even boring myself!  I’m sorry this entry is long.  It's just that oil price direction is about as clear as black gold.  Appropriate analogy – oil prices is like Goldilocks’ porridge.  But world economy is not a fairy tale so hard to be perfectly ‘just right’.  Best we can hope for is to be prepared for some unexpected surprises and that we all get along.