Conoco Phillips, Occidental Petroleum earnings, lets learn from the Guilded Age.

Oil earnings in the morning, with a Q4 price squeez.

In the morning starts the 4th quarter earnings announcements for oil and refining companies. While most of these companies did well through the end of Q3, 2014, the price of oil started its sell off really on September 30 last year. Since that time, West Texas Intermediate as gone from a September 30, 2014 value of $91.32 to a December 31, 2014 price of $53.71.

Comparables for oil companies will be Q3, 2013, when West Texas traded at $94.25 on December 31, 2013. For Q4 of 2014, the West Texas grade of crude traded down, but experienced deep losses in December. Basically West Texas started Q4 at $90 and ended on December 31 at $53.71. That involves a steep percentage loss in market value.

Where the U.S. consumer stands, they fill more volume on the same budget.

Congruent with this fall in oil prices has been a notable decline at the pump for gas prices. This could explain an expansion of consumer confidence, which posted a sharp increase outside of analyst estimates. Last month, the gauge posted at 93.1, expectations were for 96, and the reality returned a 102.9. Better than the most optimistic of expectations.

Despite this lift in consumer confidence, we have three U.S. metrics to address, and were reported just recently. The first is the -.9%  decline in retail sales for December. The second is a reduction in durable goods orders of -3.4% for December and a -.01 decline in industrial production.

Overall, the American consumer is skeptical of job condition improvement and wages. Also, and most noted, is the American consumer is filling up their gas tank at cheaper prices. You see, as prices decline, one can use the same previously budgeted dollars to gain more volume. This explains the decrease in the Energy Information Administration's volume of distillates, including gasoline. People are simply filling up at the same price point, but getting more volume.

Ultimately, consumers will not have to fill up for considerable periods. Because they have more volume in their tank, at the same budget price point, versus a few months ago. Also, better MPG is a fact.

We also have the reduction of capital expenditure from oil producers, a noted fact. Then we have job cutting occurring in the once vibrant and job generating oil space. This is also a noted fact. These developments come from perhaps one of the most vibrant spaces of the American economy. Consequently, any producer of oil production would want to see a return in real demand from consumers. That is, without a doubt, a matter of competitive price advantage.

So, let's see what American oil producers say in the morning. Obviously, margins will be stretched. Certainly, for a few production and refiners. We've seen where some airlines hedged at high prices, and have to pay back those hedges.

The real need of economies is for consumption, equating to why jobs happen.

No economy in this world can afford to spend too much on the concept of simple transportation at this time. Global economies need the consumer and jobs to grow, with a little pricing power of wages, therein will reside the power of company earnings. Pricing demand can occur outside of financial engineering (stock buy backs and dividends) , QE, or EQE, and also outside of routinely depressed interest rates. My proposition for this is Apple, how about that? They expanded sales, despite the cautions of others.

To be certain, so many companies for the last many years have relied on returns to stock buyers, without regard to the consumers of their products. Do we have to go back to the Guilded Age. I think Henry Ford gave people a wage to buy products. What an idea. Now companies hire robots that will never buy, but instead consume a company's maintenance budget and cap ex budget. All the while these robots save considerable dollars, ultimately to deplete the work force that consumes. The logical result is a net loss of available consumers to buy the product.

We are entering a static state of a real economy, and an artificially financed economy. Today, Bill Gross put it best by saying this economic situation we are in hurts capitalism.

Dow down, consumption surplus, investment in delivery

Today, the first real trading day of the year,  markets saw nearly  a 2% decline in the U.S., and that happened firstly in Europe, and Asia. Real issue is a global transition from investment and creation of production, to who is going to consume.

I saw Rick Santelli on CNBC talk about no real rise in 10 year yields. He said it, and his time horizon is very reasonable, he provides a very good perspective.  Follow him on http://www.cnbc.com/id/15837966 .

A point to review is capacity of consumption. QE has certainly provided the investment to build capacity. Now that the U.S. has been through a strong cycle of money that grew production capacity, can the American consumer buy it up? Chinese consumer is nascent at best, Japanese consumption is notorious. Europe can be a likely card. Greece leaving the euro at this point wouldn't really matter, save for further deterioration of the countries constituted to honor the currency.

Fact is, the investment cycle associated with QE is confronting that next day. Next day is who buys that invested production? That is a question of global implication,  only because it's the U.S. Dollar.... That next day view of hoped growth wanted a rise of demand. All of us wanted to see, and expected,  global growth of demand, but it didn't happen. There is an inclination to deflation.

That is why oil and markets went down today. What I see, and look forward to, is the second stage of growth across the globe. That is, transporting  production and the technology to do it. But, this time, more efficient and effective.