Self-fulfilling prophecy that is completely mythical
It’s not about fundamentals. Not for oil, gold, stocks or anything else.
In this story, a financial advisor gives us his insider’s view (UBS).
Are We There Yet?
Most financial professionals I knew, including almost every other financial advisor out of my UBS office at the time (2007), believed that crude oil was going to go up, and there was a magic number of $100. It was really about a self-fulfilling prophecy.
Oil at $100 was not about fundamentals either, at least to most sane people who understood energy. Yes, there was demand at the time, but a lot of the oil projects that were coming on were high priced projects. $100 was a psychological barrier much like Dow 20k, etc.
Then, as the GFC began taking hold, combined with the financial media frenzy that we were somehow running out of oil (insert face-palm here) drove oil to that completely mythical $100 figure.
Oil really belonged at around $40 to $50, but we knew that nature hates to take its course and had to get to $100 before getting back to reality.
Keywords: believed, self-fulfilling prophecy, psychological, financial media frenzy, completely mythical.
Director, TerraSeeds Market Technician Pte Ltd. Trader, investor. @sohtionghum was picked ‘Top 70 Forex Twitter in 2015’. Operates multiple strategies.
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