How low will gasoline go? Recession worries & Japan hits 2% - The Week Ahead - 12 Dec 2022

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Get the transcript here: https://www.completeintel.com/weekahead/how-low-will-gasoline-go-recession-japan-inflation

Link to the Twitter Spaces episode: https://twitter.com/i/spaces/1OdKrzQvybOKX?s=20

This Week Ahead is a special episode because it was recorded live, with guests Albert Marko, Sam Rines, and Mike Smith, together with host Tony Nash in a face-to-face conversation. It's also the first time that we had a Twitter Spaces, joined by a few people and taking their questions.

Gasoline prices have continued to decline here in the US. Since June, RBOB has been pretty much one way, sliding from ~$4.30 to $2.16. That’s half. Of course, lower crude prices are a huge factor, but over the summer we were hearing all about refinery capacity. Is there more to it than the oil price? XLE vs crude – XOM closing in on 100, etc. How much of an impact is this having to help affordability given the broader inflationary environment?

Inflation is proceeding unabated, as we saw in Sam's newsletter this week. Some Goldman guy was out this week saying there may be a recession in 2023. Sam looked at the terminal rate in his newsletter this week. How would accelerated inflation or steepening of recession worries affect the Fed’s actions?

We had BOJ head Kuroda (who has been in the job for a decade) begin talking about Japan hitting its 2% inflation target. If that were to happen, how likely would the BOJ be to scale back its ultra-loose monetary policy? Impact on Japan’s equity market, govt bonds, etc?

Key themes
1. How low will gasoline go?
2. Inflation/Recession worries
3. The day after Japan hits 2%

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This is the 45th episode of The Week Ahead, where experts talk about the week that just happened and what will most likely happen in the coming week.

Follow The Week Ahead panel on Twitter:

Tony: https://twitter.com/TonyNashNerd
Albert: https://twitter.com/amlivemon
Sam: https://twitter.com/SamuelRines
Tracy: https://twitter.com/chigrl

Time Stamp:
0:00 Start
1:00 Key themes for this Week Ahead
1:55 How low will gasoline go?
5:14 Is there an expectation that crude prices will come down?
9:05 Is the gas price helping solve inflation?
10:54 How would inflation/recession affect the terminal rates?
13:00 People expect prices to come down to 2019 -- will that happen?
18:50 Expectation on the terminal rate
21:30 Japan hitting the 2% inflation rate
28:50 What to expect in the US before Christmas?
33:38 Luxury market in Europe is exploding
35:40 What's happening with the reopening of China?
36:35 Xi going to the Arab-China summit after protests: what it means?
37:24 Is it still effective for a US president to bully OPEC to reduce oil prices?
40:00 Saudi-China Military deals
42:19 When China opens up, is it possible that they use its own SPR to reduce oil costs?


Listen on Spotify here: https://open.spotify.com/episode/0nzUZ7Ya334qHcXgbiSY5K?si=30fcfa51959c4918

Listen on Apple Podcasts here:


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