Oil is where it is now because......

Amaranth's positions were mostly spreads, not outrights. Natural gas *fell* in price by a huge amount from the levels where Amaranth put on their positions, without any regulatory intervention. Natural gas prices have underperformed crude oil, and are still below their highs. Thus the market with the alleged massive speculation went up less than the market without such a giant position.

Markets without actively traded futures, such as cobalt, cadmiun, and uranium, have shown price gains even bigger than the widely traded futures contracts.

Thus not only is there no evidence whatsoever that having people speculate in futures leads to greater price increases than would occur otherwise, but the more actively speculated markets went up less, and markets without actively traded futures actually soared even higher!

In other words, not only are the pols and ET conspiracy morons wrong, but the facts indicate the *exact opposite* of their conclusions.

 

Miles traveled in the US has flattened out since mid 2005 when oil hit $50 barrel and is actually on the decline. This somewhat eliminates the driving activities of the US consumer as a cause for the incredible surge in oil since last year.

From the Federal Highway Administration, TRAFFIC VOLUME TRENDS

 

lj

 

:eek:

 

Fear of rising oil prices cause airlines, trucking companies to buy futures contracts to hedge against rising prices.

however, the buying as a result of fear of rising prices adds to the pressure of rising oil prices.

it's all about pyschology of FED pumping up commodity prices with low interest rates.

low interest rates under 4% is gauranteed to cause inflation in hard assets but won't gaurantee economic growth.

result====stagflation

 

I can't believe many of the posters on this thread are really traders.... and certainly not oil traders. Guys, you can bid up the future price all you want - the spot price is set by supply and demand. (by the way, in case you haven't noticed, oil is in backwardation) Are people actually falling for that nonsense about evil speculators being at fault for rising prices? Wake up people - when the Fed debases your currency prices will rise. Speculators are a convenient scapegoat so that no one questions why the hell we allow ourselves to be raped by a central banking system.

 

Please understand Mr. Lorax1234 that I am not saying that all of what you said is crap, since it isn't. I am simply saying, that things aren't so simple as S/D and getting reamed by the Fed.

lj

BTW: If you want a little conspiracy stuff check this out. Even if the whole thing is completely fictitious, it makes for a great read.

Excerpt from Eustace Mullin's bannned in Boston book - Secrets of the Federal Reserve - yoiks!:

*Accompanying Senator Aldrich at the Hoboken station were his private secretary, Shelton; A. Piatt Andrew, Assistant Secretary of the Treasury, and Special Assistant of the National Monetary Commission; Frank Vanderlip, president of the National City Bank of New York, Henry P. Davison, senior partner of J.P. Morgan Company, and generally regarded as Morgan’s personal emissary; and Charles D. Norton, president of the Morgan-dominated First National Bank of New York. Joining the group just before the train left the station were Benjamin Strong, also known as a lieutenant of J.P. Morgan; and Paul Warburg, a recent immigrant from Germany who had joined the banking house of Kuhn, Loeb
__________________________
1 Prof. Nathaniel Wright Stephenson, Paul Warburg’s Memorandum, Nelson Aldrich A Leader in American Politics, Scribners, N.Y. 1930
1
and Company, New York as a partner earning five hundred thousand dollars a year.
Six years later, a financial writer named Bertie Charles Forbes (who later founded the Forbes Magazine; the present editor, Malcom Forbes, is his son), wrote:
"Picture a party of the nation’s greatest bankers stealing out of New York on a private railroad car under cover of darkness, stealthily hieing hundred of miles South, embarking on a mysterious launch, sneaking onto an island deserted by all but a few servants, living there a full week under such rigid secrecy that the names of not one of them was once mentioned lest the servants learn the identity and disclose to the world this strangest, most secret expedition in the history of American finance. I am not romancing; I am giving to the world, for the first time, the real story of how the famous Aldrich currency report, the foundation of our new currency system, was written . . . . The utmost secrecy was enjoined upon all. The public must not glean a hint of what was to be done. Senator Aldrich notified each one to go quietly into a private car of which the railroad had received orders to draw up on an unfrequented platform. Off the party set. New York’s ubiquitous reporters had been foiled . . . Nelson (Aldrich) had confided to Henry, Frank, Paul and Piatt that he was to keep them locked up at Jekyll Island, out of the rest of the world, until they had evolved and compiled a scientific currency system for the United States, the real birth of the present Federal Reserve System, the plan done on Jekyll Island in the conference with Paul, Frank and Henry . . . . Warburg is the link that binds the Aldrich system and the present system together. He more than any one man has made the system possible as a working reality."

 

Did any of you read the first four posts from sstrade? Look, he did'nt write the article, but took the time to post it and make it available to all of you. At least you can take the time and read it before spewing your vitriol.

 

Actually RhinoGG if you look carefully you will see that firstly, I thanked him for posting the article in its entirety and secondly, if you look even more carefully, you will see that that I first posted a link to the article on 5/6/08 in an 'Economics' thread. On 5/7/08 sstrader, having posted in that first 'Economics' thread, reposted that same link in a different 'Economics' thread and then as mentioned above he finally posted the whole article in this particular thread.

As for spewing vitriol, and speaking just for myself, I like to discuss things and to my mind unprovoked ad hominems have no place in a discussion. If you can't make your point without resorting to same, then it's best to keep your ravings to yourself. On the other hand if some poorly spoken lout engages in such activity with me, I will not stand by and take the abuse. I was not under the impression that sstrader had in fact engaged in such activity with me. I never just piss on someone but rather wait until they piss on me and then respond appropriately.

lj