March 18, 2007
Gettin’ Off Bicycles… and Riding Roach
Excerpt from this week’s interview in Barron’s with a straight-talkin’ Texan named John Segner:
“China is still using only 6.5 million barrels of oil per day. We are using 20 million barrels per day here in the United States. China is 25% of the world population. The Chinese are getting off bicycles. They want air conditioning. They are getting [better] housing. If China slows, it would just be a bump in the road. Oil-demand growth could slow down, but the chance of it going below 86 million barrels, say, next year? I just don’t see that happening. And I don’t see a lot of capacity growth. Supply-demand is still going to be tight.”
And the perennially wrong Stephen Roach is quoted in another part of the magazine:
“Subprime is today’s dot-com — the pin that pricks a much larger bubble.”
Ah, I can relax… this subprime thing is going to blow over just fine.
March 18th, 2007 at 9:57 pm
Even a broken clock is right twice a day. Maybe Mr. Roach is right this time.
March 19th, 2007 at 2:36 am
but a working clock set to the wrong time is always wrong
March 19th, 2007 at 5:03 am
Now that I read Roach’s statement I inclined to agree with CM, this will blow over.
March 20th, 2007 at 10:29 am
No, Mr. Roach was right when he turned bullish in early December, and he’s right now. Credit issues are all about leverage and markets are all about leverage, so when the easy money stops the effects are exagerated throughout the system. A 1% credit hit for a bank is about a 10% overall asset hit. And you can take that to the bank, har har.
March 20th, 2007 at 11:06 am
Mr. X: Prime mortgage delinquencies are at a whopping 2.6% … of course Roach is going to latch onto every minor crisis that comes along — he desperately needs the “house of cards” to fall after all these years of getting things exactly wrong.
March 20th, 2007 at 12:05 pm
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