Posted on 07/26/2008 5:28:44 AM PDT by decimon
If the USD is now less seen as the world's reserve currency then the pissing away has been done.
OPEC pricing oil in Euros. Hmmm...what effect would that have on oil prices here and in Europe? Could be to our benefit for some time but I don't know. Seeing EU ministers struggling with the responsibility of leadership would be interesting.
You are apparently trying to make my post fit your answer. Do you see anything in my post that calls for government control? Noooo, it discusses what actually occurred when there was just the perception of government starting to let go of control (drop the ban of drilling on the OCS) and suggests that members of government get the hell out of the way of exploration, drilling and production of crude. When (if) that occurs the price of crude will drop immediately, not when the oil actually hits the refineries.
That being the case as we have just seen a clear example of in the past two weeks, the price of crude is not strictly supply/demand. There was no change in supply from two-three weeks ago, the last change occurred what, six weeks ago with the Saudis. What changed was the perception of the future supply, not a physical change in inventory other than what was already occurring for the past three months.
I saw Harry Reid yesterday giving a speech where he took credit for oil prices dropping—said that the threat to speculators scared them! He said it with a straight face too. Democrats want gas to be $8 per gallon—no, they need gas to be $8 per gallon..
Not my answer but what is in the article that is the subject of this thread.
Already are. Mine's down so much, I've shut down my office, taken a job with a customer, and am working evenings and weekends on what little additional business remains. We're talking about a twelve year old, very successful small business here, six figure income for the majority of those years, too. I'm now barely making enough to cover expenses. It's been an ordeal, to say the least. I'm not the only one, either. Several mom & pop type retail business owners I know are extremely concerned that they won't last the summer.
Then reply to Post 1.
Post 1 is the article itself.
Where's he going to get the capital? He certainly doesn't have it lying around, so he'll need to go to the bank and borrow it (IF the bank will lend it to him).
And pay interest on the loan.
So, net-net, your genius solution: A) raises the farmer's cost in return for NO countervailing benefit to him, B) doesn't de-leverage ANYthing, just changes where the lever is, and C) very likely, when multiplied by a couple of million farmers, ends up raising interest rates for everyone else.
Any other bright ideas for us?
I was walking through the store the other day and was looking at some things that I would like. Not big things that I cannot live without but stuff that I would normally not give a second thought about buying. Same thing with going out to eat, not fine dining but pizza, mexican, etc. Down to the bare essentials.
As you know, I have tried to, numerous times, here and elsewhere. The attempt appears to be largely pointless, sad to say.
Unfortunate choice of words. A regulated market is a free market. If the futures are curtailed, spot pricing will be more important and that would lead to wild price fluctuation.
I don't think so. Regulated by whom?
Ditto!! Make them put up real money to trade.
By the market itself. Who else would have a clue? Congress? LOL
No kidding. I've begun bringing my own lunch to work, and now only set foot in a (cheap) restaurant once every week or two, for a "treat" lol. Groceries, only what's on sale and watch the sale flyers like a hawk, modifying my buying habits to keep the weekly tab to a set limit. I shop gas prices, too, filling up whenever I see a better than average price somewhere near my usual routes, but I won't go out of my way for it, since I'd be burning up my savings if I did. Clothes? Forget about it. We do have a state sales tax holiday coming up, might pick up a few things, but nothing substantial. I am literally afraid to spend any more than I absolutely have to spend to get by. I've never been so concerned about what the future holds in my over four decades of life.
It would probably be better if government was limited to the prosecution of fraud. Congress forcing a library's worth of incomprehensible laws on securities traders is not going to help me any.
Most all crops are “contracted” at a set per Bu price before they are planted and crop ins. covers them for weather problems and crop loss.
Farmers aren't playing in the futures market.
Roughly 68% of all wheat, corn, and bean growers in the US hedged their crops using futures and/or futures options in 2006, per USDA figures. Almost all the elevators hedge their inventory with futures, too, and have for decades.
SOMETIMES, when the price and the basis are favourable, a farmer **might** sell his crop on a cash-forward basis. Sometimes. Maybe. But he knows and I know (although I rather doubt that you know) that, on a total-cost basis, futures are far more financially efficient for the farmer than is dealing on a cash-forward basis.
I’m talking about the guys that put the seed in the ground, not ADM and grain elevators.
How many acres of corn do you plant a year?
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