As oil prices surge, so do worries about speculation - The Economist

Discussion in 'Wall St. News' started by Daal, Jun 19, 2009.

  1. Daal


  2. Because speculating in stocks doesn't hurt the general public. Speculating in Oil raises gas prices and affects the public.
  3. S2007S


    85 million barrels of oil consumed each day

    Speculators trade 1 Billion of barrels a day on the floor.

    Due the math........

    Speculation is why consumers paid nearly $5.00 at the pump in 2008 and close to $3.00 in todays worst recession in the US.
  4. fhl


    Maybe you've forgotten that they instituted an anti short sale rule on stocks last fall/winter because they thought speculation did hurt the public.

    How can people actually want us to be like the nations of the world that don't allow speculation? That's the dirty little secret. shhhhh! Don't look at the economies of those countries. Just forget about them and imagine the nirvana we could experience w/o speculators here in the US.

    No matter how bad a job the market does of allocating resources over time, it is still a quantum leap over letting paul krugman and his minions try to do it for us. Unfortunately, some people will only realize this after watching the central planners destroy everything in their paths.
  5. Speculation is necessary to have a working market. Without speculation there are no "noise traders" aka no liquidity.
  6. Actually, speculating in stocks arguably hurts the general public more than speculating in oil and gas (creating asset bubbles).
  7. Yes it does - it makes stocks more expensive, and thus worse value and higher risk to invest in.

    High oil and gas prices help stimulate production and supply, which lowers prices for the longer-term.
  8. I don't mind the speculators, I am a speculator as a stock trader.

    What I don't like is the concept that if you generate a guarantee like you do in the futures market, you should have 1.) the ability to get/produce the product and 2.) the proper storage capacity if delivered.

    Reminds me of the CDS market, you can write until your out of office paper and push prices around, then later find out you can't really backup what you said.

    Just my thoughts.

  9. the market is always right
    #10     Jun 21, 2009