Wednesday, January 7, 2015

S&P 500 vs. Oil smashes records



Over the last few months, there has been a big disconnect between the S&P 500 stock index and the price of Cushing crude oil.



The previous big disconnect was in 2008, but stocks crashed first as oil continued to rise, only later catching down to stocks in 2009. This time, it is crude oil that is crashing first. The obvious question is, will oil rebound and catch up to stocks, will stocks catch down to oil, is there a permanent disconnect between stocks and oil prices, or is the correlation only a coincidence?

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