“”Your notion of ‘’injecting extra costs’’ is simply risible. If a spec buys October crude at $64 and sells it at $66 four days later, the $2000 per contract profit comes right out of the pocket of the trader who sold him the crude in the first place (or his successor trader who might have sold HIM some crude when the first trader covered his losing short position).
You and Joe Schwartz, filling up at the pump, aren’t even in this equation, your phantasmagorical views to the contrary notwithstanding. The hypothetical successful spec in this example has had exactly zero effect on your wallet. Nor has the losing spec had any effect on your finances. How people come up with such notions is a mystery for the ages.”
I’m not buying. If non-delivery speculator pays more than 64 for the original October crude contract at 64 it will deliver at 64. If some greedy leech pays 66 and another 68 when October comes it will deliver at 68. Thus the crude that would have delivered at 64 without greedy leeches delivers at 68 instead a cost which trickles down to me and Joe Schwartz at the pump.
Over that last few years that has been the trend. You say it averages out, but I’m not too sure about that.
And if “Exchange and NFA figures have shown for years — decades even — that roughly 8 in 10 specs lose capital” they are obviously way dumber than I am.
Impossible.