Stock Market Highlights For August 20, 2008

Just a couple of quick comments: 

1. Oil usage as a whole was down 5.63% last week, August is tracking down 4.47% overall, continuing the accelerating decline in usage from 2.62% decline in June to a 4.0% decline in July, now 4.47% in August. This erosion of demand will continue to depress pricing. 

2. In regard to the “dip” in gasoline supplies, read the following again, CAREFULLY: “Supplies of the fuel have been falling since the week ended July 25, and they’ve tallied a drop of 20.5 million barrels in four weeks, according to EIA data.” “Refiners are not producing enough gasoline to keep inventories constant, given the current level of gasoline demand,” said Lafakis. But “gasoline demand has steadied as prices fall.” 

AND THEN, MOST IMPORTANTLY: 
“Gasoline inventories are now below year-ago levels for the first time since January,” he said. 

When a need drops and inventory builds, you need to reduce production to get inventory back in line - I’m sure there is a finite storage limit, and we probably got awful close to it. Additionally, the build in crude is caused by the length of the supply chain, the cargoes were ordered months ago, and that inventory has now built as well. 

I also hope the refineries have taken this opportunity for annual maintenance as long as they are on reduced production already.

Collaterized debt obligation or bad mortgage issue in discussing bailout is not sufficient to establish public trust. 
Revamping management of the entities in trouble is one of the other option should be taken immediately. 
There is still 500 billion USD bad mortgage in the market system.