High gas prices are due to speculation

faethor said:
Goldman Sachs say about $20/barrel is added due speculation, not supply or demand.
http://thinkprogress.org/green/2011/04/13/174989/sachs-speculators-gas-prices/
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Sort of, the supply and demand is what is drawing the speculators (read investors) into this particular commodity futures market. Had there been a future of massive amount of oil, the speculators would have found something else to invest in. See speculators don't come in just to make a living hell for everyone and not make money, that's the government's job.
 
The beauty of the financial houses buying futures is that they don't have to even offer a better price than the next guy - they are just plugged directly into the trading computers and they can buy a future before it even gets in front of a real buyer where the real price might be discovered.
 
Gee Fluffy, with all your financial expertise on how the markets work, you must have built a fortune over the years. I think it's unfair of you to not let the rest of us in on the stocks you buy, and when we should sell them.

Following your advice, we could all be rich in just a few years, and I'm sure all the members here on Whyzzat would jump at the chance.:)
 
Fade said:
Gee Fluffy, with all your financial expertise on how the markets work, you must have built a fortune over the years. I think it's unfair of you to not let the rest of us in on the stocks you buy, and when we should sell them.

Following your advice, we could all be rich in just a few years, and I'm sure all the members here on Whyzzat would jump at the chance.:)
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Actually Fluffy is not too far off. The futures market along with the stock market itself is heavily manipulated. The number of oil futures dwarf the actual number of barrels going into the market. It is a joke. It would be interesting to see oil futures go back to match actual number of barrels and make those holding the futures at expiration actually take delivery of oil. We do not have an oil shortage right now and we most certainly did not during the last oil bubble in ~2007. The difference now from 2007 is the Obama/bernanke inflation. Our current price of oil is more realistic than it was in 2007.

That said, I have to laugh at the concept of Goldman $achs stating something is improperly priced. G$ is the poster child for market corruption.
 
Dammy said:
Sort of, the supply and demand is what is drawing the speculators (read investors) into this particular commodity futures market. Had there been a future of massive amount of oil, the speculators would have found something else to invest in. See speculators don't come in just to make a living hell for everyone and not make money, that's the government's job.
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Supply and demand and the lack of supply or lack of demand will always draw speculators. Personally oil being the foundation of energy in this nation is too valuable to allow speculation. This fall out artificially manipulates most all other markets.
 
Fade said:
I think it's unfair of you to not let the rest of us in on the stocks you buy, and when we should sell them.
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Telling people what stocks to buy and when to sell them is price manipulation. It works best if you have a lot of people who listen to your advice - i.e. there is no point in me doing it. However, if you can get a large crowd to follow your advice then you can make a large amount of money by just getting out in front of them so you can profit from their trades as they follow you. Fundamentally I find this to be immoral, but depending on how you go about it (and how big you are and who you know) it need not necessarily be criminal.

Following your advice, we could all be rich in just a few years, ...
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It is NOT possible for everyone to fabulously wealthy from playing the stocks and other financial markets. The markets are just wealth distribution - like a Casino, bets are placed, some people walk away better off, some people walk away worse off (and the guys running the games skim off a cut from transactions going both ways). Someone in the real world has to do real work to create the real worth that financial dealers then play with. Thinking that everyone can get rich from the stock market is like thinking that everyone can get rich playing Monopoly(TM) - something which the game of Monopoly(TM) was actually invented to be a warning against.

Technically Monopoly is a derivative of a game demonstrating the problems with property rents as can be plainly seen by its game play, but capital markets work in a similar fashion - the greater control of the market you get the more of what's left you can acquire. The Too Big to Fails get to be the Too Bigger to Fails as we see today. Parker Brothers began marketing the Monopoly(TM) version of the game in the mid 1930s.
 
Americans are already paying $400 a gallon for gasoline. Or, rather, they are borrow to buy gasoline at $400 a gallon, which they don't get to use, but will have to pay back plus interest by taxes.
 
I guess that means you're not going to let us in on your picks then.:(
 
Five dollar gas? It's already here. Goldman isn't shedding any tears over the "unrest" in the Middle East. Quite the reverse, I'd imagine. Think your country can come surging out of a recession with gasoline prices that high (or much higher)? Between Wall Street and War Street you are getting sucked dry.
 
our oil production system is set up on a schedule... entire fields operate on timers and in some cases hundreds of them at a time arent even running at all... we've built no meaningful new refinery capabilities since the 70's so even if you increase the amount out of the ground, and you could real easy, you've no place to take it.
 
faethor said:
Supply and demand and the lack of supply or lack of demand will always draw speculators. Personally oil being the foundation of energy in this nation is too valuable to allow speculation. This fall out artificially manipulates most all other markets.
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When supply is being artificially restricted, then it's easily manipulated. That is why oil is critical for what is about to happen in the Middle East that will begin a domino effect in Europe that will spread to the rest of the world. Oil money has been pumped into the green NGOs to manipulate the politicians to create this upcoming shortage. Name of the game is control.
 
FluffyMcDeath said:
Five dollar gas? It's already here. Goldman isn't shedding any tears over the "unrest" in the Middle East. Quite the reverse, I'd imagine. Think your country can come surging out of a recession with gasoline prices that high (or much higher)? Between Wall Street and War Street you are getting sucked dry.
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Truism, and the initial target isn't the US, it's Europe.
 
robert l. bentham said:
our oil production system is set up on a schedule... entire fields operate on timers and in some cases hundreds of them at a time arent even running at all... we've built no meaningful new refinery capabilities since the 70's so even if you increase the amount out of the ground, and you could real easy, you've no place to take it.
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Existing refineries have had expansions, but I totally agree with you, we have setup regulations that have made it impossible to build a new refineries. Think it was Bush41 era when a Saudi wanted to build a super refinery in the US, he was told good luck and if succeeds to come back and tell the Administration how he did it because they think it's impossible to do so. Name of the game is control and the wealthy want full control via funding of groups that will spread that level of control via pushing for restrictive regulations. Crack dealers don't want competition because they want control so it's in their interest to keep crack illegal and other dealers out of their turf.
 
Dammy said:
When supply is being artificially restricted, then it's easily manipulated. That is why oil is critical for what is about to happen in the Middle East that will begin a domino effect in Europe that will spread to the rest of the world. Oil money has been pumped into the green NGOs to manipulate the politicians to create this upcoming shortage. Name of the game is control.
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That certainly is another way to play with Countries. Nor does it mean my previous description was inaccurate. Part of the betting on oil is betting on how that manipulation will happen.

But, hey the USA has known this since the oil embargos happening during the Ford Presidency and into the Regan Presidency. If not before for example the US coup in Iran. The USA has failed to get off the middle-east vein. Instead we got deeper with wars in Afganistan and attacking Iraq. If we were more independent we could get off the corporate welfare to provide military to protect our interests in our oil under their nations.
 
faethor said:
That certainly is another way to play with Countries. Nor does it mean my previous description was inaccurate. Part of the betting on oil is betting on how that manipulation will happen.
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Manipulation is putting it mildly.

But, hey the USA has known this since the oil embargos happening during the Ford Presidency and into the Regan Presidency. If not before for example the US coup in Iran. The USA has failed to get off the middle-east vein. Instead we got deeper with wars in Afganistan and attacking Iraq. If we were more independent we could get off the corporate welfare to provide military to protect our interests in our oil under their nations.
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Actually it was 1973 which was under President Tricky-Dicky. For the most part, we haven't had that big of a demand for the middle east oil, until the past 10 or so years when oil importation into the US began to spike. America still doesn't get all that much oil from the Middle East (mostly Saudi) as we depend far more on Mexico and Canadian oil imports for our 20M barrels of crude oil each day which means we are importing about 8M @ day which we can easily cover ourselves, if we were allowed to drill where we have known oil reserves.
 
Actually it was 1973 which was under President Tricky-Dicky. For the most part, we haven't had that big of a demand for the middle east oil, until the past 10 or so years when oil importation into the US began to spike. America still doesn't get all that much oil from the Middle East (mostly Saudi) as we depend far more on Mexico and Canadian oil imports for our 20M barrels of crude oil each day which means we are importing about 8M @ day which we can easily cover ourselves, if we were allowed to drill where we have known oil reserves.
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Thanks for the year. The umm 'older' generation having lived it might have a better memory than us that had to read it in history books.

As for oil we can cover ourselves - one plus is in the last 3 years oil production within the US is up. And we have other things coming on line too, such as the Georgia Nuclear plants.

Which brings to mind a question. Conservatives hate government funding of anything. A nuclear plant has never been built without it. But, this funding is seemingly ok as conservatives don't say one chirp about that sort of corporate welfare. Whyzzat?
 
Dammy said:
Existing refineries have had expansions, but I totally agree with you, we have setup regulations that have made it impossible to build a new refineries.
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Excuse me but that's balls. There is no need for regulations to prevent refineries being built. The economics of the situation manage that quite well. Oil companies are what they like to call vertically integrated these days. That means that they own the well head, they own the pipe-lines, they own the refineries and they own the gas stations. By moving the prices about they can make any particular stage of the process unprofitable to discourage independent s from coming in. Refineries are a big investment and knowing that the oil giants determine whether refining is profitable means that you can't expect to ever pay back what it cost to build one before your money runs out.

The oil companies are fine with this. They can point to refining bottlenecks when the price at the pump goes up and they can prevent new refiners from entering the market.
 
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