The Great Government Witchhunt
Who are these speculators?
All those speculators getting the blame for driving up the price of oil these days — just who are they? [snip]
You!
This provides a tremendous return on investment, but it contains a great risk too. At the moment, it is all upside.
Archived in: Barack Obama, Congress, Congressional Testimony, Democrats, Moonbats, RepublicansJune 29, 2008 at 6:25 pm | Trackback
8 comments
Yup, sure am. I just finished ’speculating’ and did a pre-buy for my winter’s heting fuels, oil and wood.
I was as yet unsure if oil prices could be fairly categorized as a ‘bubble’, or if its valid long term supply and demand. That was until I read a piece in (I think yesterday’s) Star Ledger. A neutral piece that simply following a day in the life of a commodity buyer.
The intro paragraph was all I needed to see. In it he sees that oil is up $4 in early morning trading, and that’s all the reason he needs to execute of a buy of 20,000 barrels. Rising prices justifying buying which causes rising prices. Just like housing before it and tech stocks before that.
It’ll pop - although how far/fast/when nobody knows - and the people who should’ve learned their lesson by the other bubbles they’ve been caught in, will get caught in the next one as well.
The greater fool theory live and in action… enjoy the ride.
Commodities trading is hazardous. When the ascension ends, it ends violently. The simple announcement that we’ll drill off the Continental Shelf might kill this one. Correct me if I’m wrong, but didn’t Daddy Bush issue an Executive Order prohibiting exploration in ANWR?
S and D can’t be ruled out. Can’t recall the figures for sure, but I think I heard consumption is at 87 bbl per day and production is at 85 bbl.
I’ve no doubt that S and D plays a significant role, with current production story and global demand growth the days of sub-dollar gas - and even sub 2-dollar gas - are long since passed.
But when people buy something simply *because* the price has gone up (instead of inspite of it being more expensive), and when people find the ability to twist supply increase reports into reasons why the price should go up, that’s when rational actors have long since left the market.
When I hear the guy in the cube next to me talking about buying contracts for barrels of oil, thats when I’ll know a crash is imminent.
It used to be the paperboy on the corner, not it’s the guy in the cubicle. Who says the world isn’t getting any better?
LL, you are lucky to find a dealer to take the delivery lock. They may have enough contracts to carry at the price now. Many of the dealers in the Addison and Rutland Counties were not taking any winter contracts.
Most persons do not realize there are only so many oil contracts available for a given month. It is simple. There is only so much oil that can be delivered to storage. The contracts being traded are on the NYMEX are for light crude. The choice for the contract holder is to sell before close date or take delivery.
http://futures.tradingcharts.c.....?market=CL
Hotspur, I think Daddy Bush closed off the OCS drilling. Many of the leases owned are dry, proven to be so by seismic and exploratory testing. Of course that means nothing to the puddin’ heads in congress.
All trading has risk; the larger the return, the grater the risk. WHEN we start refining more gas and drilling more onshore oil for gas and heating oil, prices will come down. Likely bottom is around $2.50/gal+-.
For those that have Big Oil in their IRA’s or 401(k)s, the dividends and rise in per share price pay for the gas cost. For those with the green retirement programs or have a hatred for Big Oil, you really boinked yourselves.
I want to give thanks to the selfless individuals who conserve on gas and heating fuels. This assures me of a sufficient quantity to drive everywhere when I want and avoid worrying about heating this winter.
An extra bonus comes from the incandescent bulbs which give off heat in addition to light. All for the same amount of energy and for $0.60 a bulb instead of $14.95 for a cheap toxic Chinese knock off.
Cheshire Cat: That’s the Law of Unintended Consequences in action. Same-same the Green Investment boondoggle.