I wrote this morning on another thread that I had spoken yesterday to my oil connection. He said that now OPEC is a bit nervous of the price here although they wished for it. Most feel world economies might go into heavy recession at these prices and the price might drop too low with lack of demand. He quoted as $40 for right now being preferrable. Personally I sensed that they are a bit pissed in as much as they are not behind the recent jump. He also reiterated there is no shortage. " You pay the bucks and get a tanker" I was surprized that he felt sure Bush would be re-elected.
Big Al omits any distinction between ultimate supply and production capacity limit (i.e., "peak oil"). If you can't get it out of the ground fast enough to meet demand, lookout. Greenspan's job is to delay the pain for as long as possible by helping us delude ourselves as long as possible until reality can no longer be ignored. Just look at his monetary policy.
You mean just like a few years back, we had to buy those tech stocks cause they are going to the moon and will never be cheaper ! How many months did Blodget say it would be before Qualcom would be over $1000 a share.
I mean the physical limit of production capacity of oil. Yes, the current price spike is speculative and short-term, but the long-term trend for oil is bullish due to physical limits in the rate of extraction (not the amount of reserves). Comparing stocks to commodities is asinine.
BUSH FUTURES BEING MANIPULATED There is now no question whatsoever that the Bush re-election futures contract at Tradesports.com is being manipulated. Yesterday the price of the futures were sold down from about 55 (indicating the market's estimate of a 55% probability of Bush's re-election) to 10 (indicating on a 10% probability) with a single 10,000-lot order entered by a single trader. An order that size represents twice the normal volume of an entire typical day's trading. Within moments after the order was completed, the price recovered back to the low-mid-50's. According to sources at Tradesports, yesterday's order was entered by the same individual who has heavily sold the Bush futures three times over the past month. The first instance was on September 14, when this trader sold the futures down from the mid-60's to 49.6. The second instance was in the middle of the second presidential debate on October 8, when the futures were sold down from the high 50's to 51.5. The third instance was right after the third presidential debate on October13. As the debate began the futures were priced at 57, and by the end of the debate they had risen to 60. Then a few moments later they were beaten down to 54 in a matter of minutes. In markets this kind of behavior is called a "speculative attack." The idea is not to sell at the highest price possible -- the normal profit-maximizing strategy of a typical seller. Rather, the idea is to use one's selling to deliberately cause prices to fall. Why would any sane trader try on purpose to sell at low prices? In some cases it is in order to panic other traders into selling at even lower prices, so the attacker can buy back what he sold at a profit -- traders call that a "bear raid." But in a speculative attack the motive is more complicated. It is to cause people in the real world -- not just other traders -- to panic. The classic example of a speculative attack is when George Soros massively shorted the British pound in September, 1992. The Bank of England was obliged to support the pound's exchange rate under the European Exchange Rate Mechanism. With the pound plunging and the BoE pouring billions into supporting it, prospects for the British economy were damaged -- making the pound even weaker. Eventually the BoE exhausted its will to support the pound , and had to pull out of the ERM. The pound collapsed -- and Soros is said to have made a billion dollars on this speculative attack. It's all based on what Soros has often written about as his "theory of reflexivity." It's when financial markets affect the real world, and then the real world in turn affects financial markets. It's a vicious cycle set in motion on purpose. Here's a speculation of a different sort: could Soros be behind the manipulation of the Tradesports Bush futures? The amounts of money involved are pocket change to Soros. And it would fit his avowed intention to unseat the President. It would be a cheap way for Soros to damage Bush's credibility and panic his troops. I have no idea whether Soros is behind this or not. But it would fit. donald luskin--10.16
Surf, People laugh off that maybe Soros is manipulating the markets but if you talk to brokers that have been around they say definitely it is him Another thing I don't have Greenspans oil speech on friday but I am sure I heard him say "The high oil price IS AN ATTACK ON AMERICAN CONSUMER". From this I believe they know who is forcing the price and of course others jump in on momentum.
Also he has a lot of European banks backing him. The survey out last week said practically all Euro countries including Canada and Mexico want Bush out.
I didn't hear him saying anthing like that; "In summary, much of world oil supplies reside in potentially volatile areas of the world. Improving technology is reducing the energy intensity of industrial countries, and presumably recent oil price increases will accelerate the pace of displacement of energy-intensive production facilities." more like he just brush the whole thing off. http://www.federalreserve.gov/boarddocs/speeches/2004/200410152/default.htm