The Global Scramble for Energy – MoneyWeek

***ThelargerpopulationinDubaimakethemostofliquefiednaturalgaswhytheUSisfollowingtheUK’shousingmarketleadandmore?



–WithUSfinancialgiantCitigroupsaidtobemakingsubtlepassesatEgg,theinternetbank’ssharepricesurgedsome8%onMonday。

Citigroupisallegedtobewillingtopay£1bnforEgg–pushingitssharestothetopoftheFTSE350gainerslist。

–InsurerPrudential,whichisthemajority-ownerofEgg,gained3%yesterdayonthenews。

ButareboththePruandEgginvestorsjumpingthegun?

Egg’ssharepriceisexpensivecomparedwithotherbanks。

Moreover,asconsumerssufferincreasinglyundermountingdebt,CitigroupwillundoubtedlybeafterproofthattheinternetbankwillnotbeplaguedbythebaddebtsthatarehauntingbothBarclaysandHSBCwithanyformalbidheldbackaccordingly。

–AtleasttheEgg-PrudentialsharepricegainhelpedlifttheindicesonMonday。

TheFTSE100traded10pointshigher,tocloseat5,242。

Themid-cap250indextraded48pointsintheblack,tocloseat7,567–anothernewall-timerecordfortheindex。

Soanotherstrongdayfortheindicesbutcantheycontinuetheircurrentupswing?

–“AtthemomentIwouldn’tseeitgoingtoomuchfurther,”HargreavesLansdown’sRichardHuntersaidyesterday。

“Thereisthisdefinitechanceforconsolidation”。

–Theindex-slowdowncouldalsobeassistedbytheretailsector,whichcontinuestostruggleasconsumerconfidenceweakens。

AccordingtoretailmetricsgroupSPSL,thenumberofshoppershasfalleneverymonthinthepastyearcomparedto2004,exceptinJune。

–Andasretailersbattlewithlackofconsumers,privateequitygroups,whichhavemadehighlyleveragedbidsforretailersoverthepastcoupleofyears–therebyboostingtheindices–couldjustbeputoffthehabit。

Whichcouldinturnimpactontheindices。

–InthemeantimeMarksSpencerislikelytoshowitsseventhstraightquarteroffallingsaleswhenitreportsitscoresalestomorrow。

Andit’snotjusttheconsumerstoblame:MShaslostouttothesupermarketgiants–whoarecurrentlyembroiledinapricewarinordertotemptshoppersintotheirstores。

Marksisexpectedtoreportlike-for-likegeneralmerchandisesalestofallsome5%。

Itssharepricetraded1%upyesterday。

–AndVodafonealsoaddedover1%onMondayasLehmanBrotherstoldinvestorstodumpBTsharesinexchangeforthemobilephonegroup。

Vodafonehasalreadycompletednearly£2bnofits£4。

5bnsharebuy-backtargetfortheyear–whichiswellaheadofexpectations,whileBTcouldbeknockedifderegulationofthebroadbandmarketsareachieved?



TheFatKidsofDubai–SimilartotheUSAandEurope,Dubai’spopulationisbecomingincreasinglyobese,saysBeatErniinTheProfitHunterFiles。

NearlyonethirdofallchildrenintheGulfregionarenowsaidtobeabovetheweightthatakidoftheirageshouldbe。

Sowhatdoesthismeanforinvestors?

Forone,withtheriskofdiabetes“sky-rocketing”inDubai,thereareanumberofwell-establishedcompaniesthatshouldbenefit。

ButtheeatinghabitswillalsobenefitanumberofWesterncountrieslookingtomakethemostofthe“relativelyuntappedmarketsofArabia”

TheGlobalScrambleforEnergy–Naturalgasispredictedtoovertakecoalandislikelytorivaloilastheleadingfossilfuelontheglobeinjust20years,saysDanDenninginTheFleetStreetLetter。

Andasaresult,gas-richcountriescouldbesittingonaseriousamountofcapital。

Yettheincreasingrelianceongasistakingitstoll:thepoliticaltiesbetweenBritainandAmericaforonecouldbecomestrainedintheirbidtosecurenaturalgassupplies。

Indiatoohasjustsigneda$20bnwithIrantopurchaseLNGacountrythat’snottoopopularwiththeWesterngovernmentsatthemomentMoreonLNG?

UK/USHousingandtheUpcomingLiquidityTrap–UKhousebuildersfearthathigherunemploymentlevelscoulddestabilisethehousingmarket。

AndnowAmericacouldbefacingthesameproblem。

It’snosecretthatintheUSthecurrentalleged‘recovery’is“amazinglyweak”,saysMikeShedlockinWhiskeyGunpowder。

Andthere’slittlesignofajobpick-upintheUSA–withthejobsaddedbarelykeepingupwithimmigrationandpopulationgrowth。

Theresult?

ThestrugglingjobsgrowthwilleventuallyspilloverintothelaststrongsectorleftinAmerica:housing。

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