Crude to $89

Discussion in 'Commodity Futures' started by Wallace, Jun 20, 2005.

  1. the "real value"

    in the short term, the "real value" of a commodity, where price is set in a two way auction market, is the price the market imposes.

    at least from a trader's perspective.

    that is what two way auction markets DO - they determine value via the price discovery process

    you can argue the "real value" of oil is $30 if u want. depends on what metric u use - it's utility, it's relative scarcity/supply, the cost of extraction, etc.

    heck, marx said "labor is value", so you can use that metric as well

    but if you are a trader, you best be cognizant that the market determines what value is.

    again, in my investment account, i might agree with you, but in that case i would be willing to buy weakness, sell strength, and wait for regression to a mean

    as a trader, that would be a recipe for margin calls and losing money
     
    #21     Dec 24, 2006
  2. getting there
     
    • cw.png
      File size:
      19.2 KB
      Views:
      126
    #22     Sep 15, 2007
  3. gkadir

    gkadir

    The real problem is Iran is going to charge for its oil in Euro's. That is a direct threat to the US dollar. US can't print money if that happens.

    Saddam started to charge in Euro's thats why he is longer with us.

    Everything else is BS, read between the lines.
     
    #23     Sep 15, 2007