coincedence or not
- Thread starter attack_06
- Start date
It's 3.94 a gallon Tuesday morning in Neenah, Wisconsin. That up about 20 cents since Saturday when I last filled my tank. Where's the Global Crisis? I don't see it. Last year when the Horizon blew up in the Gulf I expected prices to go through the roof, and nothing much occurred. Now we have some "unrest" in the middle east (as recent as the last 2,000 years) and they can't change the price signs fast enough at the local Quick Gouge.
Firecatguy
New member
Didn't the big O put a ban on domestic drilling??? Can't blame Bush any more.....don't know how to keep this non-political
anonomoose
New member
Cat the big O banned off shore drilling, but has since recanted on that..maybe suspend would have been a better choice of terms. Oil companies are drilling all over the place domestically, and the country is beginning to feel like a pin cushion.
Those poor oil companies are hurting so badly that the governor of Alaska is pitching to give them a huge tax break to drill on the north slope....just to see if there is any oil there, don't yah know. (do you think they have him in their pockets???) http://www.adn.com/2011/04/11/1804786/stevens-senate-wont-be-bullied.html
Meanwhile the commodities brokers are driving the prices up by bidding on the oil, even though they can't take delivery of it. A law (which would never get thru congress if it could get there) making anyone who bids on oil to actually take delivery of it every 90 days or so, would cut this crap out. But try and get that law thru would have a snowballs chance in chicago...aka he!!.
It was on the news last nite that because folks have stopped driving the price must go up....gee do you think this will improve the economy if folks stay home and sit on the front porch? Only Polarisguy can afford to buy and drive if this keep up...and you just KNOW he will pass that cost on to his customers.
Chrysler says they "might" begin putting diesel engines in some jeeps in three years.....bet that will turn things around...they got caught not knowing the price of fuel was creeping up(?????), and are SPEEEEEEEDING along it's development even though the build and sell diesel engines in other countries.
What a mess.....
Those poor oil companies are hurting so badly that the governor of Alaska is pitching to give them a huge tax break to drill on the north slope....just to see if there is any oil there, don't yah know. (do you think they have him in their pockets???) http://www.adn.com/2011/04/11/1804786/stevens-senate-wont-be-bullied.html
Meanwhile the commodities brokers are driving the prices up by bidding on the oil, even though they can't take delivery of it. A law (which would never get thru congress if it could get there) making anyone who bids on oil to actually take delivery of it every 90 days or so, would cut this crap out. But try and get that law thru would have a snowballs chance in chicago...aka he!!.
It was on the news last nite that because folks have stopped driving the price must go up....gee do you think this will improve the economy if folks stay home and sit on the front porch? Only Polarisguy can afford to buy and drive if this keep up...and you just KNOW he will pass that cost on to his customers.
Chrysler says they "might" begin putting diesel engines in some jeeps in three years.....bet that will turn things around...they got caught not knowing the price of fuel was creeping up(?????), and are SPEEEEEEEDING along it's development even though the build and sell diesel engines in other countries.
What a mess.....
From Gannett Newspapers
The Obama administration imposed a six-month ban on new deepwater drilling in the Gulf last year, after the Deepwater Horizon oil rig exploded and sank on April 20, killing 11 workers and creating the nation's worst oil spill.
The ban was designed to give federal officials time to review safety changes. They have since begun to issue permits for new wells.
*******
I'm not an expert on this, but it seems to me that a producing well, which impacts daily inventories, is what would have the short term impact on price. Producing wells in the Gulf continued to produce. The ban, for right or wrong, stopped DRILLING, not producing. The impact (again, I am not an expert) would appear to be on the Louisiana economy, not the supply of oil in the short term, as production continued. In the longer term, stopping oil exploration in the Gulf for 6 months will delay new production, but I'm guessing it takes longer than 6 months to drill an oil well, therefore the ban had minimal impact on inventories and price in the short term.
The political unrest in the Middle East is kinda epic, in that it is not the usual "they shoot at me, I shoot back" tribal/religious conflict, but it is an uprising of people against their own governments. They are rising up against the cruel dictators who have ruled them with an iron fist for decades. And what did these cruel dictators do so well? They kept the oil flowing! So, the question is, "can the rebels who may take over Libya continue to keep oil flowing?" Nobody knows, so risk increases and speculators buy in as additional countries have civil unrest. Speculators buy in, price goes up, and Moose handled that in his post so I am done.
And that's how you stop the thread from being political.
G
G
Guest
As long as oil is traded as a commodity we at the bottom of the food chain are screwed. Supply and demand have nothing to do with the equation anymore. Nor does drilling here or there or whatever. Even the Oil companies themselves are at the mercy of the traders.
The average commodity trader actually has little effect on price these days. The Fund Trader is who controls what happens in the markets. They have 1000's of times the capital to work with and will come and completely overtake any market they decide to "dabble" in. So in an ironic twist of fate, all of your retirement money is actually causing the wild swings in most of the markets. Of course a fund manager is going to respond to things like political unrest in the Middle East when trading the oil markets, or a drought when trading the corn, soybean and wheat markets. But the truth is, the average commodity trader gets steam rolled by the fund activity.
By the way, limiting participants in the open outcry commodity markets to only those that can take delivery is about the worst possible thing you can do. All it will do is reduce liquidity in the markets and hand the controls over to the big oil companies. Want to see ugly prices of oil, take the speculation and market participants out of the equation and let it be run by a select few.
Open outcry markets are vastly different from things like the equities (stocks). In stock trading (not stock options), you only make money when the price goes up. In the open outcry, there are equal amounts of money made and lost no matter of the price goes up or down. Commodity markets are like a tug of war. One side gains an inch and another loses an inch. The more participants on either side, the less impact one participant will have. If you have 4 participants on each side of the tug of war and one is a 800lb gorilla (fund trader), then the side with the gorilla is most likely to win. Have 100 participants on both sides and the impact the gorilla has is vastly reduced.
If you want to remove some of the huge price swings in commodities, limiting fund activity is the answer. Of course, then there would be treads about how everyone's retirement fund is not growing!
-John
By the way, limiting participants in the open outcry commodity markets to only those that can take delivery is about the worst possible thing you can do. All it will do is reduce liquidity in the markets and hand the controls over to the big oil companies. Want to see ugly prices of oil, take the speculation and market participants out of the equation and let it be run by a select few.
Open outcry markets are vastly different from things like the equities (stocks). In stock trading (not stock options), you only make money when the price goes up. In the open outcry, there are equal amounts of money made and lost no matter of the price goes up or down. Commodity markets are like a tug of war. One side gains an inch and another loses an inch. The more participants on either side, the less impact one participant will have. If you have 4 participants on each side of the tug of war and one is a 800lb gorilla (fund trader), then the side with the gorilla is most likely to win. Have 100 participants on both sides and the impact the gorilla has is vastly reduced.
If you want to remove some of the huge price swings in commodities, limiting fund activity is the answer. Of course, then there would be treads about how everyone's retirement fund is not growing!
-John
Drilling more oil isn't the answer:
http://www.youtube.com/watch?v=FOdysANCQUM&feature=related
After all, how could increasing supply bring down prices?
http://www.youtube.com/watch?v=FOdysANCQUM&feature=related
After all, how could increasing supply bring down prices?
anonomoose
New member
This is true...and by traders, I mean to include these huge fund managers who are working the markets up and down daily.
It's all about the numbers of traders....the more there is the more you have movement...usually up as each buys and sells into it. Prior to 1984 and becoming a commodity, all of the oil was owned by the oil companies...no traders at all. What was so wrong with that? If you have 50 people bidding on stuff, that is 25 times more chance you will pay more for it...basic bid auction processing. Auctioners love more people not less when they are about to put product on the market. I think that if you had 50% of the buyers thinking the price will go down and 50% going up...then it would stagnate....but that isn't what happens in oil...someone stubs a toe in timbucktoo, and some speculater reads about it and tells his guys to put a buy on it. That buy costs everyone in the country, more money.
While this might be true on average when speculators read the tea leaves and think the price is on a run....this gets imbalanced, and off to the races, and the price of everything else runs with it. Reduce this to a few, and fingers can be pointed, and that puts repercussions where they need to be. Rules and restrains get put in place....eh?
I have no problem with my money being out of oil. It has become such a nasty business, it has become, in my opinion, UN-American, to own it. I chose not to gain retirement income on the backs of my friends and neighbors....I'm kinda funny that way.
Don't mean to be mean, but all I can say is on this one Boon you are way out of touch. There are so many inaccuracies in what you just typed that I really do not even know where to start and honestly don't have the time to prove your wrong with actual facts not opinions. Please trust me on this one, I have worked with the commodity markets on a daily basis for 20 years and get market commentary from several sources, several times a day. While I do not trade personally, I have been involved in the markets so closely for 20 years that I probably have more knowledge and experience than some traders do.
If you want to put the inmates in charge of the keys to the asylum (close open outcry markets and let oil companies set the price), that is your opinion.
I am done with this one. I spoke my peace, tried to illustrate things in a clear and simple manner, but I seriously doubt your mind will be changed- even though there is a first for everything!
By the way, Oil down today $4, just about every commodity across the board down. Reason? Funds got spooked prices were too high and sold got out of some of their longs.
-John
If you want to put the inmates in charge of the keys to the asylum (close open outcry markets and let oil companies set the price), that is your opinion.
I am done with this one. I spoke my peace, tried to illustrate things in a clear and simple manner, but I seriously doubt your mind will be changed- even though there is a first for everything!
By the way, Oil down today $4, just about every commodity across the board down. Reason? Funds got spooked prices were too high and sold got out of some of their longs.
-John
anonomoose
New member
Not tryin to change anyone's mind...too hard to do and not worth tryin either. Just reading and listening to the self described experts, who all more or less elude to the electronic traders who jump in and out and move the markets.
Oil does a blip down today because...."The slide in crude came after a Goldman Sachs forecast for a $20-a-barrel drop in crude prices this spring." (like they have some sort of crystal ball, eh?)
And of course tomorrow someone will shoot a hole in a pipeline and it will shoot up all over again.
Come on natural gas and electric.....I am all sorts of ready for it.
Who wants to build a steam powered sled....runs on wood?? We got plenty of that, and nobody trades it YET on the market.
Oil does a blip down today because...."The slide in crude came after a Goldman Sachs forecast for a $20-a-barrel drop in crude prices this spring." (like they have some sort of crystal ball, eh?)
And of course tomorrow someone will shoot a hole in a pipeline and it will shoot up all over again.
Come on natural gas and electric.....I am all sorts of ready for it.
Who wants to build a steam powered sled....runs on wood?? We got plenty of that, and nobody trades it YET on the market.
http://www.dailyfinance.com/story/the-real-reason-gas-prices-are-soaring/19893347/?icid=maing
This article pretty much sums up everything.
This article pretty much sums up everything.
I have no problem with my money being out of oil. It has become such a nasty business, it has become, in my opinion, UN-American, to own it. I chose not to gain retirement income on the backs of my friends and neighbors....I'm kinda funny that way.[/QUOTE]
So you do not buy, sell or trade with them currently to create an income or savings for retirement?
So you do not buy, sell or trade with them currently to create an income or savings for retirement?
anonomoose
New member
Spot on Artic....folks who CAN"T take delivery are in speculating and making billions by driving the prices up. NO shorting going on...always buying on the long side. It kills the up down movement....moving it upward only.
And I don't bleed for anyone's retirement income coming on the backs of everyone else and a better economy. For a few, EVERYONE takes a bath.
And once again, good old fashioned corporate greed from brokerage houses trickles down and congress won't put regulations in to stop this, because they are bought off from the brokerage houses.
This down economy all started with the spike in oil prices, and this upward pricing will kill any recovery quicker than stones sink in water.
anonomoose
New member
So you do not buy, sell or trade with them currently to create an income or savings for retirement?[/QUOTE]
I do NOT, and won't. I also won't buy tobacco stock, or from any company that is owned by tobacco, and that's a bunch.
Paying attention to what you invest in for not only growth, but for moral reasons. Unfortunately, once again, folks ask no questions as long as their retirement portfolio grows...the faster the better. But I believe there is a moral question here too. One that isn't crystal clear, but one that can decide just how hard your kids and grandkids will have to work. If you can live with modest growth from places that don't exploit, then that is good for the country, which is often the last thing that anyone thinks about when they invest. That's why Bernie Madoff made billions...nobody asked questions, as long as the money flows in. It is a lesson we should all take note of. Would you invest in drug smuggling? How about stuff that isn't so cut and dried but damaging to the country?
If we don't invest in it, WE can control how it works collectively. Tall order to be sure, but do-able in my opinion. And high time to ask yourself if what you do today, will jeopardize what your children and grandchildren will be facing tomorrow. It isn't like we don't know any better...we are just used to assuming what we do won't matter. But it surely does and that indeference can take down any country, as history has shown us over and over again.
Funny. I read the article and no where did I read where it was said that all speculators not able to take delivery was the problem. The entire article seemed to be about the funds being the problem.
-John
anonomoose
New member
Well the article says how the market isn't balanced, and continues to move only to the upside.
The part about taking delivery was posed as a potential remedy to remove the speculators from having a field day when they have no intention on or capability of taking delivery of the product they are bidding on. While this same process is true of all commodities, oil is unique and as the article clearly points out, by putting so many buyers into the picture, it can't help but push the prices higher....if you want a piece of the pie, you have to pay whatever it takes to get it.
BTW, I didn't come up with the "take delivery" clause...I have heard that from several of the pundits who say this would work.
Oh, and don't forget your smiley face
The part about taking delivery was posed as a potential remedy to remove the speculators from having a field day when they have no intention on or capability of taking delivery of the product they are bidding on. While this same process is true of all commodities, oil is unique and as the article clearly points out, by putting so many buyers into the picture, it can't help but push the prices higher....if you want a piece of the pie, you have to pay whatever it takes to get it.
BTW, I didn't come up with the "take delivery" clause...I have heard that from several of the pundits who say this would work.
Oh, and don't forget your smiley face