Just three weeks to go before the end of the year, and stock markets should be celebrating. Instead, equity markets have been down as traders become increasingly spooked by the decline in oil prices. Granted, financial markets sometimes get it wrong, but the present atmosphere of fear is one for the books.

Investors are afraid that oil prices could go even lower. The question to ask is how low is too low? Someone somewhere came up with the price of $60 a barrel as a "fair" price for oil. This week it broke that price level and markets in Europe and the U.S. sold off. What are investors thinking?

For starters, some believe the decline in oil prices is indicative of slowing world demand for energy. If true, then maybe the global economy is growing even slower than investors thought. In which case, stocks are too high, despite all the central bank stimulus.

Then there are the oil patch companies themselves. We all know the big-name global players that pay good dividends and are (were) considered salt of the earth investments. Some of these names are down 20-30 percent so far this year. Then, too, there are the drillers and junior drillers, those high-flyers that led the fracking and oil shale boom. Those stocks are getting decimated.

The hurting that these companies are experiencing right now also brings into question the health of their finances, specifically the money borrowed from banks to fund their exploration and development.  Extrapolating from the oil price, the logic becomes: oil down, stocks down (due to worries over company solvency), which then spills over to what banks could or could not be in trouble due to energy loans. And so it goes.

What readers should immediately notice is that, with the exception of a declining oil price, none of the above has happened and there is less than a slight chance that it will. Why?

Energy's share of the business sector of GDP in the U.S. is 5.9 percent. Not much, and certainly not enough to take GDP down with it. Especially when consumer spending is 67 percent of GDP and declining oil boosts that kind of spending.

In the stock market, energy has less than a 10 percent weighting in the S&P 500 Index. Right now the sector is taking the entire index down with it, but the numbers tell you that it is an over-reaction. What about those big mega-cap companies with solid dividends? Exxon's CEO said his company would be okay with $40 oil. As for the supply/demand equation, I believe the new technology-driven increase in the supply of various forms of energy, especially in the U.S., is what is driving the price of oil lower, not decreasing demand.

I'm not disputing that if energy prices continue to slide, and they could, that some companies in that sector, especially the small aggressive kind, will have financial trouble. But that has been true since wildcatters have been wildcatters. It doesn't mean that the whole market should be carried down with them.

If we step back and look at the markets from a dispassionate point of view, we simply see that from the October sell-off, stocks have gone straight up with hardly a pause. What we are seeing today is simply a much-needed pull back from the highs. In my opinion, this decline has pretty much run its course.

Over time, the benefits of cheaper oil worldwide will have a beneficial impact on all energy-consuming companies and their financial markets. Wall Street would like to see those benefits show up immediately, but that is not the way of the world. It takes time to derive the benefits of this kind of price decline and it won't happen overnight. For those with a longer term view, this decline is a great opportunity.

Bill Schmick is registered as an investment adviser representative with Berkshire Money Management. Bill’s forecasts and opinions are purely his own. None of the information presented here should be construed as an endorsement of BMM or a solicitation to become a client of BMM. Direct inquires to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com.

Ukraine had been the topic on everyone's lips for over six months. Today, nary a word is written about Russian's plan to annex that nation. You can thank declining oil prices for that.

While most of the West rejoices over the recent precipitous drop in the price of oil, the story is quite different for the largest producer of fossil fuel energy, Mother Russia. That's right, Russia, and not Saudi Arabia, leads the world in energy production. As such, Russia depends on energy for 16 percent of its gross domestic product, 52 percent of total federal revenues and 70 percent of all exports. And that was in 2012. Since then the numbers are even higher.

As the price of energy continues to decline, so does the Russian currency, the ruble. It has dropped by 26 percent in the last year and just today fell another 1.3 percent. In the first half of this year alone, the Russian economy contracted by over 10 percent and that was before the brunt of the oil decline occurred. Russian officials estimated they will lose $90-100 billion a year based on oil's decline.

Officially, the Russian Economic Ministry cut its forecast for GDP in 2015 from 1.2  percent to minus-0.8. The Russian people are going to feel that bite with real incomes falling by 2.8 percent. This will be the country's first recession since 2009. At the same time, the inflation rate is expected to rise from 7.5 percent to 9 percent. In an effort to combat rising inflation their central bank is hiking interest rates at the same time to almost 10.5 percent, further hurting economic growth.

 Earlier in the year, the prospects for the Russian economy were already looking fairly anemic, thanks to Putin's adventurism in Crimea. In retaliation, U.S. and European sanctions have now begun to bite. By Russian forecasts, those sanctions will cost the country $40 billion this year. They have also effectively closed off global capital markets to Russian banks and corporations. As a result, investment has dropped off a cliff as uncertainty, combined with a lack of security, has devastated corporate Russia

On Dec. 4, Putin addressed his government ministers and parliament with a mix of sophisticated economic plans to liberalize the economy and good old-fashioned nationalism that would have made Hitler proud. Of course, he blamed the West for everything from Russia's current economic woes to annexing Crimea and Ukraine.

It was interesting that he barely mentioned the continuing war in Eastern Ukraine. It appears that the declining oil price has damaged Putin's plans far more than the economic sanctions instituted by the West. Was it a fortuitous coincidence that energy prices started to decline this year just as Vladimir Putin began to marshal his forces for a move into Ukraine?

Readers should remember that the Kingdom of Saudi Arabia, which is getting the blame for not supporting oil prices, is a key U.S. ally. What better way to hamstring Russian adventurism than to hit them where it really hurts via oil? Notice, too, that both the administration and Congress has been silent about this recent energy rout, although theoretically, declining oil prices hurts our burgeoning shale industry and American efforts at energy independence.

I say let the oil price fall until it doesn't. Let the markets determine the fair value of energy and hopefully, in the meantime, bankrupt the Russian bear.

Bill Schmick is registered as an investment adviser representative with Berkshire Money Management. Bill’s forecasts and opinions are purely his own. None of the information presented here should be construed as an endorsement of BMM or a solicitation to become a client of BMM. Direct inquires to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com.

The disappointing 11 percent decline in brick and mortar retail sales on Black Friday took Wall Street and Corporate America by surprise. Excuses vary from the holiday shopping fad has run its course, to people just wanted to be with their families on Thanksgiving. Don't believe it.

One CEO of a mega-discount retail company, when interviewed, bemoaned the disappointing sales, blaming the economy's 2-3 percent growth range, which he said, "feels like it's kind of perpetual."  For all of the hype and advertising devoted to turning out consumers for the extended Thanksgiving weekend, Black Friday was the biggest dud of the year.

This occurred even as the price of oil declined by over 30 percent, providing the largest boost to the consumer's pocketbook in years. Despite this windfall, consumers stayed home. It is part of an on-going story within this American economic recovery. Sure, Corporate America is making record profits. The stock markets are at record highs and, on the surface, unemployment is trending lower, but much of America is being left out of these good times.

Although the October jobs report showed strength in employment, a deeper examination reveals that much of the gains were in part-time or temporary employment. October's report showed that wages rose 0.1 percent for the month and for the year just 2.0 percent. That's below the rate of inflation. The truth is that after six years of recovery wages have stood still.

The jobs that are being created in this country are minimum wage service jobs for the most part. Last month, one out of every five jobs created in the U.S. went to a bartender or waiter. We now have almost as many jobs in those professions as we do in manufacturing.

This year congress, at the behest of Corporate America, shot down a hike in the minimum wage, arguing that a pay raise would cause corporations to reduce the number of workers they employ. With a shrinking middle class and more and more Americans subsisting on minimum wage jobs, exactly how are we expected to go shopping on Black Friday? At best, a worker's monthly paycheck covered Thanksgiving dinner for the family. Is Wall Street so far removed from the economic reality that the rest of us face?

In January, 1914, over a hundred years ago, thousands of American workers stood in the frigid Detroit winter to take Henry Ford up on his offer. The auto magnate was offering workers $5 an hour, double the prevailing wage, to work in his motor assembly plant. With that act alone, Ford established a middle class in this country and revolutionized the business world.

Now Ford was no philanthropist, far from it. Up until then his yearly production of Model "T” Fords was averaging about 200,000 automobiles. He wanted to move that number up to a million, but realized that there simply were not enough Americans with the kind of money necessary to buy one. None of his workers, for example, could afford to buy the product that they were making. He resolved to solve that problem and he did.

Fast forward to today. What is happening in this country is quite the opposite. Corporations are making fatter and fatter profits, mainly by cost cutting and financial engineering, while their workforce is succumbing to a lower and lower standard of living. The big retailer I mentioned at the beginning of this column, while lamenting his lack of sales, neglected to mention that his company had just discontinued medical benefits for their thousands of part-time workers.

This is going to be a real problem going forward for a country that depends on consumer spending for almost 70 percent of its economic growth. Unfortunately, both Wall Street and Corporate America exhibit, at best, short-term myopia and at worse, long term stupidity.

Bill Schmick is registered as an investment adviser representative with Berkshire Money Management. Bill’s forecasts and opinions are purely his own. None of the information presented here should be construed as an endorsement of BMM or a solicitation to become a client of BMM. Direct inquires to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com.

A doctor shortage in America has been predicted ever since the first Baby Boomers started to retire.  Now, that shortage is coming into question as technology and non-doctor, medical professionals are stepping forward to fill the gap.

The Association of American Medical Colleges predicts the nation will need 90,000 doctors by 2020 and 130,000 physicians by 2025. It is understandable how that organization arrived at that number. Just compute the proportion of Americans who will reach the age of 65 between now and 2030. Add to it the number of Americans newly insured, thanks to the Affordable Care Act, and you come pretty close to those numbers.

However, those figures simply represent the demand side of the equation assuming everything else remains the same.  To be sure, there will still be a shortage of general practitioners, those front line physicians who are our first stop in accessing medical treatment and services.  But a whole host of breakthroughs in medical knowledge, technology and treatment protocols are reducing not only the hours required to treat an aging population, but also the location of such treatment.

As a result, fewer patients visit hospitals today and when they do, their stay is reduced by a variety of outpatient choices. This pares down on the number of doctor visits each patient requires. In addition, many surgical procedures, thanks to advances in knowledge and technology, can be accomplished today through minimally invasive procedures that require less recovery time and therefore less doctor time.

Take my upcoming knee replacement, as an example. I have only seen my orthopedic surgeon once and will probably not see him again until the surgery. My hospital stay will be 2-3 days at the most, barring complications, and I'll most likely see him a week or so after the operation. That's it. Of course, in the meantime, I am seeing an army of technicians, physical therapists and so on.

This brings me to another sea change in medical treatment, the rise of the non-doctor primary care providers that include physician assistants, nurse practitioners, pharmacists and social workers. More often than not, you will find them working in teams. Think of the doctor’s assistant as the operations manager who, in my case, is sending me hither and yon to see various practitioners both before, during and after my operation.

In today's world you may never even see the doctor for some ailments. This year my GP suggested I see a dermatologist, (something I have avoided in the past). I have been back five times since that first visit and have never once seen the doctor. My skin ailments have been handled by a physician's assistant and a nurse practitioner. I'm sure the same thing is happening to you.

Training 130,000 doctors over the next decade requires an enormous amount of resources. In contrast, expanding medical practice law to allow nurses and pharmacists to provide more comprehensive primary care is a cheaper and a more time-efficient method to fill much of this potential doctor shortage. More emphasis on "team care" in our medical schools would also help leverage an underutilized medical work force that could do much, much more. Combined with the continued breakthroughs in medical technology and devices, we may just be able to keep up with the demand from people like me.

Bill Schmick is registered as an investment adviser representative with Berkshire Money Management. Bill’s forecasts and opinions are purely his own. None of the information presented here should be construed as an endorsement of BMM or a solicitation to become a client of BMM. Direct inquires to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com.

The U.S. Senate rejected passage of the Keystone Pipeline by one vote this week. The controversial energy plan will be back on the agenda, however, in January. For most of us, separating fact from fiction as both sides alter the facts is difficult at best, but here are some things we do know.

First, we can describe the project. The proposed Keystone XL project consists of an 875-mile stretch of pipeline and related facilities that will transport 830,000 barrels per day (bpd) of crude oil from Alberta, Canada, through Montana, South Dakota and Nebraska. It will then connect to existing pipeline facilities that flow through Nebraska, Oklahoma and ultimately down to the Texas Gulf Coast region.

About 40 percent of the total project has been completed. A 298-mile line that runs from Steele City, Neb., to Cushing, Okla., already exists as does another 485-mile piece between Cushing and Nederland, Texas. Oil is already flowing within these segments of the pipeline from various oil wells within the U.S.. The remaining segment has been held up for years thanks to the political wrangling among various American politicians and lobbyists.

There has been a cost to this controversy. Thanks to the delays, the price tag to complete the project has already doubled to something like $8 billion to $9 billion. Once approved, it will take two years to build out the pipeline and get things connected.

Depending on who you listen to, the project would mean as few as 20,000 high-paying construction jobs to as many as 42,000 (if you count indirect jobs). Energy spokesmen will tout as many as 200,000, but don't believe that. What no one disputes is that those jobs are only temporary. The actual head count of permanent jobs, once the project is complete, comes in at 50 or less.

Alberta has the third largest proven oil reserves in the world after Saudi Arabia and Venezuela, but much of it is buried within what is called "tar sands." Tar sands are a mixture of sand, water, clay and bitumen. The oil-rich bitumen can be processed into heavy, viscous oil. Producing the stuff will emit an estimated 17 percent more greenhouse gases than traditional oil drilling in the U.S. That is why the likes of Al Gore and Robert Redford are against it.

So if it is environmentally evil and good for just a few long-term jobs why in the world would this country want to approve it?

Over the long-term it makes sense strategically for us and our trading partner to the north.

Let's take Canada first. Our neighbor to the north is our largest source of oil imports, providing almost 2 million of a total of 9 million barrels of imports per day. Strategically, we know that two other major suppliers are problematic. Mexico's oil output is declining and Venezuela is unreliable at best.

Transporting oil via the pipeline from Canada would replace that shortfall for America. In addition, what we don't use, we can export. By law, America is only allowed to export third-party oil. Right now that only amounts to 30,000 bpd. Next year, that number is estimated to rise to 230,000 bpd. The Keystone pipeline would dramatically increase that number while reducing the amount we import from unreliable sources.

The fact is that with or without us, Canada will extract oil from their tar sands. So the argument becomes will we make it easier and safer for them to do so? Our environmentalists want Canada to just abandon the extraction program entirely.

Personally, I would rather our environmentalists focus more on our own issues and let Canada handle the environmental fallout from their tar sands extraction. In typical "America knows best" fashion we see nothing wrong with dictating what another country should do with its natural resources. But does Canada demand that we reduce our coal-fired generation industry, which has a carbon footprint 60 times larger than Alberta oil sands? Does anyone recognize that Canada produces less than 2 percent of the world's greenhouse gas emissions and tar sands make up just 5 percent of that total?

For once, let's do something that is good for Canada, a country that has stood by us through thick and thin for decades. Sure they can find other means of transportation — namely truck and rail — but why should they have to? The pipeline makes sense for us and for Canada.

Bill Schmick is registered as an investment adviser representative with Berkshire Money Management. Bill’s forecasts and opinions are purely his own. None of the information presented here should be construed as an endorsement of BMM or a solicitation to become a client of BMM. Direct inquires to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com.