Americans can hedge vs. gasoline prices

Discussion in 'Economics' started by Lights, Apr 30, 2006.

  1. Everyone has the ability to buy unleaded futures.
  2. That sounds good, but we don't have to deep pockets to withstand the volatility like the industry has. Nice try though.
  3. Americans stomach a 30% rise in fuel costs and rampant volatility over several months. It can cost $60 to fill a tank of gas a week.

    Forget unleaded futures. 1 share of USO, which tracks the price of West Texas Crude is priced at $69.62. No, u don't need deep pockets to hedge and yes, americans withstand volatility falsely believing they have no power against rising prices.

    Americans pay millions in insurance monies against disaster. This is no different.

  4. Very interesting post...

    Make sure to include the total hedge....meaning the total costs per family of the rise in prices of all goods sensitive to oil prices...not just auto self transport needs.....
  5. gkishot


    Americans can hedge against the rising gasoline prices by using the public transportaion.
  6. rosy


    putting on a hedge limits total upside. People would rather gamble than hedge
  7. empee


    but if everyone started hedging, wouldn't the price go higher (ie short squeeze) and thus impede eveyrone else from hedging?

    What about people with no assets (ie poor people). Do they still count as people in the US?

    Maybe they should be counted as 3/5 of a person if you make less than $25,000 a year!
  8. maybe they can wrap it in a decent system, and start neighborhood hedge pools
  9. Yeah, 42000 gallon per contract.
    I might not even use 420 gallon a year. And keep rolling it over every month with contango and commision and everything else. Not to mention margin calls if the price goes down.

    Please keep me updated on your hedging process.