Remember, it was oil that sent shock waves through the global economy early in the year. Meanwhile everyone was focusing on China’s economic slowdown, and ignoring the disease of cheap oil. In fact, most of the strategists and economist in the tall buildings in New York were telling us cheap oil was great for the economy. We saw it differently. We’ve talked a lot about oil in the past few months. In our first Forbes Billionaire’s Pro Perspectives note, back in January 26th, we laid out all of the reasons oil could destroy the global economy, AND why the central banks would NOT let it happen.
We think it’s important to always keep an eye on the forest rather than the trees, to keep perspective on the big theme, rather than the daily news. With that, today, we want to revisit that note from January. I think you’ll find the script has played out beautifully. And with a robust oil recovery now underway, we have an economic environment that sets up, as we’ve said in recent weeks, for positive surprises and for a broad sentiment shift — away from gloom and doom, and toward a more optimistic outlook. That shift means a lot for commodities, stocks, bond yields, the job market, the housing market…you name it.
OIL & CHINA
Since the global economic crisis erupted in 2007–2008, the world has slowly been in repair–mode, but we’ve had numerous events along the way that have shaken global investor confidence. And expect that to continue.