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Oil Speculation - 4/1/2010 5:50:20 PM   
flcouple2009


Posts: 2784
Joined: 1/8/2009
Status: offline 		But I thought there was no speculation and it was all the fault of the Arabs.

WASHINGTON — Oil consumption has fallen, demand from U.S. motorists for gasoline is flat at best and refiners that turn crude into fuel are operating well below capacity. Yet oil prices keep marching toward $90 a barrel, pushing gasoline toward $3 a gallon in many markets, and prompting American drivers to ask, "What gives?" Blame it on the same folks who brought you $140 oil and $4 gasoline in 2008: Wall Street speculators.
http://news.yahoo.com/s/mcclatchy/3467023
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RE: Oil Speculation - 4/1/2010 5:52:21 PM   
Thadius


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Joined: 10/11/2005
Status: offline 		I also blame it on certain companies trying to gouge folks during a week of holidays and the travel associated with them... but could be wrong.

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RE: Oil Speculation - 4/1/2010 5:57:30 PM   
Sanity


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From: Nampa, Idaho USA
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What was it, a year ago, two years ago,... every time there was a spike in gas prices everyone was expected to acknowledge as solemnly as possible that it was the direct fault of the president of the United States.


quote:

ORIGINAL: flcouple2009

But I thought there was no speculation and it was all the fault of the Arabs.

WASHINGTON — Oil consumption has fallen, demand from U.S. motorists for gasoline is flat at best and refiners that turn crude into fuel are operating well below capacity. Yet oil prices keep marching toward $90 a barrel, pushing gasoline toward $3 a gallon in many markets, and prompting American drivers to ask, "What gives?" Blame it on the same folks who brought you $140 oil and $4 gasoline in 2008: Wall Street speculators.
http://news.yahoo.com/s/mcclatchy/3467023


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RE: Oil Speculation - 4/1/2010 6:07:13 PM   
flcouple2009


Posts: 2784
Joined: 1/8/2009
Status: offline 		Bush wasn't responsible for the speculation at the time that drove the oil prices to record highs any more than Obama is responsible now.

Than as now the rising price has nothing to do with supply.

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RE: Oil Speculation - 4/1/2010 6:07:38 PM   
servantforuse


Posts: 6363
Joined: 3/8/2006
Status: offline 		News Flash:: The United States is not the only country buying oil on the world market.

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RE: Oil Speculation - 4/1/2010 6:11:02 PM   
Sanity


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You might be able to sell that argument now but a few years ago it would have been heresy.

quote:

ORIGINAL: servantforuse

News Flash:: The United States is not the only country buying oil on the world market.


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RE: Oil Speculation - 4/1/2010 6:20:48 PM   
Raiikun


Posts: 2650
Status: offline 		And what are the speculators speculating on?

Increased consumption in China. (In the link in the OP).

Speculation often drives short term prices, but it's typically very tied to supply. They're basicly investing in it on the hopes that prices will rise driven by various factors, including supply, so they can make money on their investment later.

If they're wrong, then they stand to lose money.

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RE: Oil Speculation - 4/1/2010 6:22:51 PM   
InvisibleBlack


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quote:

ORIGINAL: flcouple2009

But I thought there was no speculation and it was all the fault of the Arabs.

WASHINGTON — Oil consumption has fallen, demand from U.S. motorists for gasoline is flat at best and refiners that turn crude into fuel are operating well below capacity. Yet oil prices keep marching toward $90 a barrel, pushing gasoline toward $3 a gallon in many markets, and prompting American drivers to ask, "What gives?" Blame it on the same folks who brought you $140 oil and $4 gasoline in 2008: Wall Street speculators.
http://news.yahoo.com/s/mcclatchy/3467023


While I haven't done any real investigation of this - perhaps the price of oil is not going up, perhaps the value of the dollar is going down. For the past couple of weeks I believe that oil, gold and the stock market have all been moving together, something that historically has been extremely rare but is easily explained if you factor in a devaluing currency.

Since I really haven't looked into this, I freely admit I could be completely off-base here.

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RE: Oil Speculation - 4/1/2010 6:45:49 PM   
servantforuse


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Status: offline 		Maybe, just maybe, others countries like China and India might have something to do with the price oil ? It is called supply and demand.

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RE: Oil Speculation - 4/1/2010 10:01:33 PM   
Termyn8or


Posts: 18681
Joined: 11/12/2005
Status: offline 		FR

OK, speculators only are betting on increased prices.

That's fine but the main problem is that speculators artifically increase the demand prematurely. This is all done in the name of profit, personal profit which winds up costing the rest of us. Is that right, and, is that OK with you ?

Now about the demand. There is no way in hell that China and India produced enough vehicles for domestic use in the time span that the prices rose so dramatically. Sure it may have been a factor, but not of a large enough magnitude for that level of increase. Speculators did it, unless China and India had free raw materials, we know they have the labor, but the materials, no way. Not with all China exports at the very least.

Granted a bunch of new industry opening up in those countries would increase demand, and that demand would chiefly rely on their need for the components to make plastic. I still just don't think it adds up, do you ?

And there's not much we can do about it. Too many people retire on such investments, too many funds are "slushy" for insurance claims and need to be supported against inflation, which is actually the devaluation of the currency.

There is no way to regulate this properly that I can see. Abolishing the whole mess would leave millions in much worse shape than they are now. But speculation can be accomplished by buying something and simply agreeing not to take delivery for a time, at the fixed price. However, perhaps some regulation of what is on paper ? Hell our money is nothing but paper and we couldn't even regulate that, so I have no idea what to do.

Normally I like to finish with some sort of possibly viable idea on how to solve a problem, but I am at a loss here. Those who see most of this problem we have as actually being caused mostly by speculation, got any ideas ?

T

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RE: Oil Speculation - 4/1/2010 10:14:14 PM   
Silence8


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quote:

ORIGINAL: Termyn8or

And there's not much we can do about it. Too many people retire on such investments, too many funds are "slushy" for insurance claims and need to be supported against inflation, which is actually the devaluation of the currency.

There is no way to regulate this properly that I can see. Abolishing the whole mess would leave millions in much worse shape than they are now. But speculation can be accomplished by buying something and simply agreeing not to take delivery for a time, at the fixed price. However, perhaps some regulation of what is on paper ? Hell our money is nothing but paper and we couldn't even regulate that, so I have no idea what to do.

Normally I like to finish with some sort of possibly viable idea on how to solve a problem, but I am at a loss here. Those who see most of this problem we have as actually being caused mostly by speculation, got any ideas ?

T


How much does this relate back to the banks and the stock market? (And, as always, the war(s)...). Also, the growth of the super-human corporation, and so on...

What would no inflation even look like? I feel like I'm a black and white movie, trying to imagine color, or in some dystopia, and the word 'freedom' is foreign and strange to me.

< Message edited by Silence8 -- 4/1/2010 10:15:47 PM >

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RE: Oil Speculation - 4/1/2010 11:02:21 PM   
MrRodgers


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quote:

ORIGINAL: Raiikun

And what are the speculators speculating on?

Increased consumption in China. (In the link in the OP).

Speculation often drives short term prices, but it's typically very tied to supply. They're basicly investing in it on the hopes that prices will rise driven by various factors, including supply, so they can make money on their investment later.

If they're wrong, then they stand to lose money.

All that need be 'tied to supply'...is their speculation of it. Billions ride on an educated guess that is often wrong. The secret is being too big to fail. When enough money seeks it, it draws more money, none of which is creating a single job, has no business being included in GDP it Producing nothing and is the essence of capitalism.

It is all pure speculation on some form of paper and as John Adams warned...we've 'turned paper into money' and are now...'forever slave to the speculators.' None of it need be in response to actual supply and demand...they being unknown.

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RE: Oil Speculation - 4/2/2010 8:07:33 AM   
Kirata


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From: USA
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quote:

ORIGINAL: MrRodgers

When enough money seeks it, it draws more money, none of which is creating a single job, has no business being included in GDP it Producing nothing and is the essence of capitalism.

Unproductive greed is quite precisely NOT "the essense of capitalism."

K.

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RE: Oil Speculation - 4/2/2010 9:57:48 AM   
Musicmystery


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quote:

ORIGINAL: Thadius

I also blame it on certain companies trying to gouge folks during a week of holidays and the travel associated with them... but could be wrong.

I'm no defender of this industry or its practices.

But having managed from within once, I can tell you that yes, you are wrong. It is truly a matter of supply and demand.

(in reply to Thadius)
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RE: Oil Speculation - 4/2/2010 9:59:42 AM   
Musicmystery


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Joined: 3/14/2005
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quote:

has no business being included in GDP


It's not. Only the market value of what is actually sold, not futures speculators trade.

(in reply to MrRodgers)
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