What can Kill the Oil and Gold Bull?

Discussion in 'Commodity Futures' started by chewbacca, Jul 13, 2006.

  1. SteveD


    I would assume that you guys who are locked in the 17th century would also be mad about other things:

    abolition of slavery
    allowing women to vote
    etc etc



    #41     Jul 16, 2006
  2. cam0940


    Don't get mad at me, it was your comment. I didn't force you to write that.

    Steve you're right, ultimately Gold is a trading instrument.

    When my wife gets in the car, she pushes the accelerator and the car goes. She knows it periodically needs gas. That's about the extent of her knowledge of automobiles, and that's all she really WANTS to know. If--heaven forbid--one day it didn't work exactly like it was supposed to, she wouldn't have the slightest idea what the problem was.

    We really have the same thing going on in the Dollar. Just because people accept your Dollars like you expect them to, those of us from the 17th century were just trying to have a lively discussion about "what's under the hood". Which IS THERE, whether we have to deal with it on a daily basis or not.
    #42     Jul 16, 2006
  3. Hey, bears eat deer, bulls and turtles... they dont eat grass... {and I think they might have a particularly strong apettite for bulls.
    #43     Jul 16, 2006

  4. http://www.elitetrader.com/vb/showthread.php?s=&threadid=66669

    on this thread, the facts, for the most part, have been substantiated, and this discusson, as well as my synopsis are not, as you suggested, emotionalism and privilige snobbers (entitlement).

    Actually, more participants added more substantiation than a few pages of reading normally provide.

    What smacks of entitlement was the disposition and attitude of your comments, as if somehow we as Americans, who consume slightly more than 25.01% of available petroleum need to pay more or should pay as Europeans do.

    What also smacks of emotionalism in your comments were the notions that somehow these conditions, which have surfaced and dominate the business media and news, since the Bush Administration took office are justified and rational.

    Simply put, all the same news articles and conditions, whether geo political unstability, economic or otherwise have and were here in the same amounts as under the Clinton Administration. The major difference remains how the stories continue to spin and produce $3.25 unleaded gasoline prices (artificially).

    Now they are eagerly talking, almost dripping at the mouth in anticipation, of $4.00+ gasoline prices and $100+ per barrel oil, as if these unfortunate events in Lebanon and Isreal should produce these predictions.

    It is regrettable that so many choose to continue to agree and support these artificially inflated prices that have been engineered to transfer wealth at world historic rates.

    Shame on you, and enjoy paying $4 gasoline, no, $6.85 gasoline prices.
    #44     Jul 16, 2006
  5. 1) European gas prices are a reflection of higher taxes for the most part. I never implied that we -should- pay just as Europeans, or just as Chinese (which have subsidized gas), or anyone else.

    2) rational is a relative term. I think the california housing market's boom seemed fiscally insane. But cheap money lended to everyone and their grandmother with no standards of credit requirement propped it up. So it became rational in the big picture. At least, we understand why it happened. Same with the tech boom - very high PE ratios, unprofitable companies, and booming stock prices, all fueled buy speculation and excitement. Not rational to an old school value 'investor', but certainly rational when considering the economic circumstances of the time, with increased investor access to leverage, excitement about a major cultural and economic change (internet has changed our live's genuinely), and a pool of venture capital liquidity waiting to be consumed.

    today's commodity boom has its own rationalizations. I think gold is worthless, and don't get the appeal. But enough people disagree with me in its safe haven inflation fighting value, so why fight it? I think energy is a better inflation hedge, but supply and demand laws still determine its price. Perhaps there are faults in the market, but those faults rationalize where we are at, and until those faults are remedied, nothing will change, and commodities will continue to be expensive.

    Your bitching about a desire for cheap oil once again just reminds me of the typical complaint of every uninformed redblooded american who has no understanding of the basic concept of supply, demand, and market forces and faults that determine price. It reminds me of the same ignorant fools who bitch about 'price gouging' from gas stations or want oil companies to pay a windfall tax because they have sour grapes that someone is making money while they are losing it.

    The irony is that these are the very same people who are so proud of our free market democracy and ready to fight wars in its name. These are the same people who paradoxically really desire a socialistic system. They're just to 'shamed' to say it. If they can't admit that, then all I'm left to call it is a sense of entitlement.

    All I'm suggesting is that the market tells the story. This is not simply an elite upper class conspiracy like you point out. Perhaps there is a little of that, but no system is perfect. It is a combination of possible broken price discovery, genuine supply concerns, media hype (stimulating long spec buying), too much leverage available to future traders, and very real hiked demand issues resulting from booming economies.

    Oil will spike up, from all this hype, we'll have a worldwide equity bear market for a few years, and demand will back down. And for a while, oil will once again be cheap (I don't think $25-$35 cheap, though). If we're even luckier, maybe nymex will be pressured to reduce available leverage to traders - but not while we have a Bush administration.

    That is, of course, until the next iteration of supply worries, if not from politics, from declining worldwide production. That'll be your next bull oil market.

    And don't bother shaming me; if you get off shaming strangers on the internet, perhaps your desire to feel self confidence could be channeled in more constructive ways.

    Me calling you emotional and calling your sense of entitlement probably hit a chord because maybe there's some truth to it.
    #45     Jul 16, 2006
  6. SC,

    no, you didn't strike any cord in me or otherwise,

    however, what I usually don't do is engage in a direct one : one conversation, as I slipped this time in doing.

    the thread that I quoted was one that i started,

    it received not only quantitative support, both for the thesis and against, as well as other intelligent commentary without cursing or otherwise.

    I find open discussion on these board beneficial not only in economic terms but ultimately towards improving my trading, whether or not someone agrees, disagrees or derades themselves into cursing, as it that adds some weight or substance to their comments.

    I have found too many high strung individuals on these boards, and try not to insight them with trading barbs, insults or otherwise and expect, but as shown, don't always receive, the same curtesy and respect in return.


    the commentaries recently on CNBC and on other financial news channels, where they quote from traders on the NYMEX Oil pits not openly acknowledge the (conveniently called) $30+ risk premium on each barrel of oil. They have begun to openly acknowledge an over supply of oil, and under normal terms the prices should have returned to their true $24 - $26 barrel price, not these artificially inflated $78 rates we have seen recently.

    I take these traders perspective as a basis of my comments, as well as my trades in the markets, not some wishful, hopeful or even delusionary entitlemt of lower prices. If I can't trust those who make the markets in these contracts, then perhaps I can't trust their sources of trades related data and insight either.

    Trade well,

    Be well,

    I'm out!
    #46     Jul 17, 2006
  7. Galatia


    It's USA who wants high oil prices and and favors from it. High oil price means artificial $ demand from the rest of the world. If oil price goes down, USA $ will collapse down. To ensure petroldollar cycle works, oil prices must remain high. Just because of this whenever dollar gets weak, suddenly, a middle east crisis occurs. Just like in 1973 OPEC oil crisis...
    #47     Jul 19, 2006