Posted on 06/25/2008 6:52:16 AM PDT by tatsinfla
NEW YORK (CNNMoney.com) -- Oil expert Daniel Yergin will tell Congress on Wednesday that speculative oil traders have played a role in driving up prices but other factors, such as the subprime mortgage crisis, have also been a factor.
(Excerpt) Read more at money.cnn.com ...
The subprime mess has contributed to the decline in the US dollar, which raises the prices of imports, chiefly among them, oil.
“so now the subprime mess is causing high oil prices, just when i think i have heard all the excuses.”
I think the subprime mess is also causing global warming.
“so now the subprime mess is causing high oil prices, just when i think i have heard all the excuses. “
No excuse, just a fact.
The mortgage crisis caused the fed to devalue the currency. If a dollar is worth less, imported goods, (oil), cost more.
With something as big as oil, there is no single cause to price spikes. Short supply, commodities traders, price fixing, weak currency, high demand, instability in supplier nations, inefficient use are all factors.
I totally agree. Many variables came together which resulted in oil where it is. Looking to blame just one single thing (speculators) is flawed in its tunnel vision. And correcting one single thing (drill here, drill now) is equally flawed in it’s tunnel vision.
So you address what you can. Take basic regulatory actions such as requiring more transparency in futures markets and not allowing investment banks such as GS and MS to be treated as commercial buyers exempt from position limits.
And open up more federal and offshore lands for drilling. Maybe provide tax breaks for employers to encourage telecommuting.
The problem is, all the various sides want to just blame one factor because taking a comprehensive approach doesn't suit the various agendas in play here.
...but isn't the sub-prime mess also affecting the Euro, perhaps in a greater fashion?... so it should have little effect on the US Dollar/Euro rates...
Congress is to blame for the subprime crisis as well, so I don’t think this gets them off the hook.
You mean Supply and Demand might have something to do with Price?
Whoa!
(Sound of Liberal heads exloding)
This is from CNN which is just Marxist/Democrat propaganda.
I see CNN like other Democrats blame speculators in their headline.
Well U.S. speculators are not the only ones trading but oil is traded in many other world markets. The Democrat call for regulating U.S. speculators is just a ploy because the U.S. Congress can only cripple U.S. market sand can’t regulate the other world markets.
U.S. oil companies own 3% of world oil reserves.
The government of Saudia Arabia owns 33% of world oil reserves.
The price of oil is high because total WORLD oil production(supply) has not kept up with WORLD oil demand since 2004. It is not high because of U.S. speculators. This is one of the most basic laws of economics the law of supply and demand.
Oil is also high because Democrats and other socialists around the world are restricting oil drilling because of the hoax of global warming. Sunspot activity is very low indicating that the earth is entering a severe cooling period akin to the little Ice AGe: http://www.dailygalaxy.com/my_weblog/2008/06/the-sunspot-mys.html.
And in fact the Earth cooled .7 degrees Celsius in one year (last year) but you don’t see this in the liberal media. But Democrats and the media are still screaming on TV that U.S. industry and Americans driving SuVS and oil companies are destroying the planet with global warming.
It’s a surprise to me that many freepers take this Marxist propaganda from CNN serously.
Global instability: Nothings changed, even had two Gulf Wars (wellheads burning everywhere) still didn't see prices near what we see today.
Peak oil: No major shortages, no long lines, nothing that really resembles the 70's embargo when there were undeniable shortfalls in supplies. Nope.
Refining: Doesn't make much sense, you don't have to refine anything to make oil.
Dollar Devaluation: Sure, anything we import will require more dollars.
Futures Trading: If the value of the product is attached to the price of the stock the outcome is obvious. How much of a change in futures investment has there been in the last 5 or more years.
Govt. Regulation: Many changes have been made concerning trade, lending, stock, taxes, energy (mostly talk), and accounting practices. All of which would have an effect felt throughout the global economy intentional or not.
The investment banks lost their shorts on subprime, so they went looking for a way to get those trillions back. They found it, at least for a short while.
I think the subprime mess is also causing ED.
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