Last month, Goldman finally admitted that its “super-spike” theory was wrong, and that oil was not going to $200 anytime soon. In a major 180, it said that oil could hit a low of $50 as early as December. Well that came a lot sooner than anticipated, and $50 may soon be a thing of the past. Where’s it going now? Goldman has no clue. They’re giving up:
TechTraderDaily: On Thursday, Goldman said it was “closing” its recommendations for oil trades. Meaning that in a perilous time when the traders who pay attention to Goldman’s recommendations could use some guidance the most, Goldman has opted to give them the least. And some traders are furious about it, comparing the manoeuvre to then-strategist Abby Cohen’s decision to abandon her targets for equity indexes in the fall 2001, citing the uncertainties abounding in the market. Goldman specifically talked about four trade recommendations it previously issued, and said clients shouldn’t put any stock in them any longer.
Are traders really that furious? Goldman’s advice wasn’t worth that much, and if they say they don’t know where oil prices are going, then they probably don’t. There’s reason for them to keep giving out forecasts, when they have no confidence in them.
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