03 Jun 09
Originally posted by normbenignSpeculative highs and lows can last very long without reaching "market" values. Look at the history of the Nikkei index.
If speculation truly drives a bubble, then in the end the speculators take a bath when actual market conditions set the end price of the commodity.
The only people who make money in this speculative process are those who time the market correctly and buy low and sell high. None of this really effects long term the price of the commodity.
The specul ...[text shortened]... ulation of a year ago? We are talking future contracts, not present day actual sales of goods.
03 Jun 09
2 edits
Originally posted by normbenignYou were given the names of the market players in the video.
I would like to see a detailed analysis of who made and lost money during last year's cycle.
Unfortunately not all of them are required to report publicly. And with dark markets we'll never know who was buying and selling at what times and what quantities.
03 Jun 09
Originally posted by uzlessAbsolutely not. The marketing and distribution of crude oil and oil related products is truly global, very much seasonal, terribly geopolitical, and no doubt the most highly taxed and regulated business in the world.
Would you state that the doubling of oil prices from 30 bux to 60 bux in the last few months is because of an increase in DEMAND?
It is truly global, most of the increased demand coming from newly industrialized countries like China and India.
To attempt to understand price fluctuations on the basis of any one factor such as speculators or supply ignores the scope and complexity of this market.
Focusing on something like speculators intentionally diverts attention from the basics. Supply has to increase at least equal with demand. This can be either by new petroleum, or by alternatives. Bottlenecks, and disincentives must be removed. Government policies that negatively impact the industry must be reduced or removed.
03 Jun 09
Originally posted by normbenignExactly.
Absolutely not. The marketing and distribution of crude oil and oil related products is truly global, very much seasonal, terribly geopolitical, and no doubt the most highly taxed and regulated business in the world.
It is truly global, most of the increased demand coming from newly industrialized countries like China and India.
To attempt to under ...[text shortened]... of any one factor such as speculators or supply ignores the scope and complexity of this market.
03 Jun 09
Originally posted by PalynkaI'm not quite sure that I believe that the big guys all get out unscathed. Look at the bath Kurkorian took investing in GM stock just last year, and he lost on Chrysler before that. Those outside the investor class tend to see only the wealth of investors, not the losses.
The problem is that large players in the market can influence pricing and use market dynamics to generate a cycle that they can profit from. Idiot traders following technical analysis will follow and take a bath, while the market maker pockets the money.
In the meantime, the real industry gets stuck with huge price swings in a commodity like oil.
Gates lost nearly half his considerable fortune in a day when the dot com bubble burst, pricked by a pin of the government, a court ruling against MS.
There are no "market makers". In the end, we are the market makers, consumers.
03 Jun 09
Originally posted by normbenignWell, I didn't say all the big guys get unscathed. All I'm saying is that there are speculators which have the power to force some price changes. It is well known that Soros used his large positions to force some devaluations, so it is certainly possible that some players know they can affect the market and use it to their advantage. Why wouldn't they?
I'm not quite sure that I believe that the big guys all get out unscathed. Look at the bath Kurkorian took investing in GM stock just last year, and he lost on Chrysler before that. Those outside the investor class tend to see only the wealth of investors, not the losses.
Gates lost nearly half his considerable fortune in a day when the dot com bubbl ...[text shortened]... gainst MS.
There are no "market makers". In the end, we are the market makers, consumers.
03 Jun 09
Originally posted by normbenignHow nice that we get this news today regarding the drop in oil prices after investors find out crude supplies have increased 20% from last year. Looks like the investors headed for the exits today.
Focusing on something like speculators intentionally diverts attention from the basics. Supply has to increase at least equal with demand. This can be either by new petroleum, or by alternatives. Bottlenecks, and disincentives must be removed. Government policies that negatively impact the industry must be reduced or removed.
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Oil falls on report of stored surplus
Jun 03, 2009 03:00 PM
Be the first to comment on this article...
Dirk Lammers
THE ASSOCIATED PRESS
SIOUX FALLS, S.D. – Oil prices slumped today when a U.S. government report on unused crude in storage suggested the month-long rally in energy prices may have been premature.
Crude and gasoline prices tumbled through most of the year as storage facilities filled up. Heavy industry and individual consumers had pulled back sharply on energy spending.
After rising for seven straight days and threatening to break the US$70 barrier, benchmark crude for July delivery tumbled more than four per cent, or $2.80 to $65.75 a barrel on the New York Mercantile Exchange.
The catalyst was a report from the Energy Department's Energy Information Administration, which said crude in storage rose by 2.9 million barrels to 366 million barrels, which is 20.3 per cent above year-ago levels.
Analysts had expected storage levels to fall as they had in the previous three weeks. Huge inventory levels earlier in the year had pushed energy prices to five-year lows.
The report sent a jolt through the market, which has been flooded in recent weeks by money from investors who have capitalized on a weak dollar. Because crude futures are priced in the U.S. currency, oil is relatively cheap.
But that strategy can go only so far if no one is buying oil.
There are few signs that energy demand has rebounded strongly, despite some glimmers of optimism from the manufacturing sectors in Europe, China and the United States. Heavy industry is a big energy consumer, particularly of natural gas.
Natural gas futures plunged 9 per cent today. Earlier this week, there was a rush of money into natural gas, which looked like a bargain next to oil, which had been on an extended rally.
That optimism, at least today, looks misplaced.
"It seems like the prices have gotten a little ahead of themselves," said Chip Hodge, managing director of MFC Global Investment Management in Boston.
The run-up has been felt at the pump, where prices rose by more than two cents overnight to hit $2.548, according to auto club AAA, Wright Express and Oil Price Information Service. That's more than 11 cents higher than last week and well above the $2.07 that gas cost just a month ago.
There is a danger that high energy prices could slow any economic recovery, beginning on the level of the individual consumer who must fill up the gas tank.
Hodge said he doesn't think oil prices will rise above $70 per barrel until there's some kind of uptick in demand.
http://www.thestar.com/business/article/644750
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uzless <------ wins again
03 Jun 09
Originally posted by uzless*sigh*
How nice that we get this news today regarding the drop in oil prices after investors find out crude supplies have increased 20% from last year. Looks like the investors headed for the exits today.
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[b]Oil falls on report of stored surplus
Jun 03, 2009 03:00 PM
Be the first ...[text shortened]... ------------------------------------------------------------
uzless <------ wins again[/b]
Not uzless, but hopeless.
03 Jun 09
Originally posted by PalynkaIt may happen, but it isn't without risk.
Well, I didn't say all the big guys get unscathed. All I'm saying is that there are speculators which have the power to force some price changes. It is well known that Soros used his large positions to force some devaluations, so it is certainly possible that some players know they can affect the market and use it to their advantage. Why wouldn't they?
04 Jun 09
1 edit
Originally posted by Palynkabecause its funny watching you not answer direct questions...you're like that kellyjay guy. Why answer a question when you can just ask a different question yourself. You are the master of saying nothing.
I tried many times, you still don't understand what I'm saying and repeatedly mischaracterize my position. Why should I bother anymore?
Cases in point.....
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Originally posted by uzless
Would you state that the doubling of oil prices from 30 bux to 60 bux in the last few months is because of an increase in DEMAND?
Palynka: Again you commit the mistake of thinking 30 bux was a "fair" price. Do you seriously believe there was no undershooting?
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Originally posted by uzless
I'll take that as you think this increase is from Demand and not speculators
Palynka: Lulz
Tell me. Do speculators only earn money if the oil price rises?
04 Jun 09
1 edit
Originally posted by uzlessWhat don't you understand about my answer? Your question is loaded because it presumes 30 was a "fair" price explained by fundamentals alone.
because its funny watching you not answer direct questions...you're like that kellyjay guy. Why answer a question when you can just ask a different question yourself. You are the master of saying nothing.
Cases in point.....
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Originally posted by uzless
Would you state that the ators
Palynka: Lulz
Tell me. Do speculators only earn money if the oil price rises?