The Perfect Storm Part One

Yes, I am burdened once more by thoughts of the coming oil wars. The news this week is filled with ominous signs and portents. First we have the downgrading of Ford and GM bonds to the status of Junk. That was something I read about almost 3 months ago in the Economist. And yet they continued on course to build more and more of the vehicles that they can no longer sell. What were they thinking? If you were no longer the leader in automobile sales, wouldn’t you study the strategy of the company that took your place as leader? OK, it’s no big deal. If Ford and GM go bankrupt or are sold off, the market will twitch for a moment and then motor on. The market abhors a vacuum and it will quickly fill any vacancy. And the SUV/light truck anchor that is dragging these two old companies down is just one symptom of what’s wrong with our attitude towards oil.