Crazy Prices?

Oil for January 2009 delivery is priced at $43.80. For January 2010 delivery, it is $56.21, or 28% higher. That 28% has to cover my cost of financing and storing oil for one year. Could that be? Short term interest rates are very very low -- if a bank would lend me money on a sure bet! How much could the cost of storage be? Hmmm....

And NOMINAL interest rates on US Treasury bills went negative. In the US Treasury's auction of bills, the yield was ZERO. People are willing to lend US Treasury money at no cost. Gosh, I hope the Treasury locks in as much money as they can at these "deal of the century rates." I am going to wait just a bit longer, then lock in as much long term mortgage money as I can at 4.5 to 5% (I hope).

The Cold Blast is Coming

We hit close to zero degrees Fahrenheit in Hanover the last two nights.

Southern California is due for some cold as well: "Rare 50 year Arctic Blast Sets Sights On Southern California."

And 2008 will go down as the coldest year of the decade at least.

And the US Congress has seen it wise to take money from a fund dedicated to helping Detroit produce environmentally friendly cars and use the money for keeping the Big Three out of Chapter 11 (or 7). I vote for "none of the above."

Selling to the Highest Bidder!

On a day that I covered auction theory in my class, it was heartening to see that Governor Blagojevich of Illinois was (allegedly) running an auction of his own. According to the New York Times Blagojevich took to heart at least the most basic auction lesson, that of selling to the highest bidder:

"CHICAGO — Gov. Rod R. Blagojevich of Illinois was arrested by federal authorities on Tuesday morning on corruption charges, including an allegation that he conspired to effectively sell President-elect Barack Obama’s seat in the United States Senate to the highest bidder."

It sounds like his wife added some nice quips on the wiretaps.