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On the 8th February 2016, VCL published its monthly note. This included the publication of VCL's CEO, Martin Wood's monthly comment, as well as this month's five resource stocks of interest, which can be seen on the Short Note page, plus a topical cartoon.

"Since the beginning of the global financial disaster in 2008 the best economic brains in the world have been in charge of the war on recession and have fired every fiscal weapon possible to win this battle. They failed and it is now 2016 and we still limp on but now with virtually 0% base rates and a failed QE policy that merely bailed out the banks and created asset bubbles across the globe, most notably in real estate.

So the economic genius' and their theories didn't work. What will save us? Which super hero will fly in from stage right at the last minute and defeat the villain that is 'persistent economic malaise'?

Maybe cheap oil? Cheap oil is REAL QE.  It used to cost me, and by extension you, 40% more to fill up than today - that is £40 in my jeans each week. Roll that out across a country and an economic system and you have real financial assistance to the people that matter - the standard issue family. 

Yes - we still have the Chinese debt bomb, sub primed and ready to explode. Yes we still have persistent structural failings in the economies of southern Europe. Yes, we still have an American economy that thinks saving is a dirty word. But cheap oil helps all those issues a little, delays the day of reckoning a while, and let's us kick that can just a little further down the road. 

So, Saudi Arabia (while trying to hurt Iran and Russia and kill the US fracking industry and the Canadian oil sands industry) accidentally saves the world from 'Economic Armageddon'. Immaculate white flowing robes and a shemagh - the new super hero outfit for our time?"

Martin

VCL Office address:

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EC4R 2RB

 

Contact:

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