Posted on 03/31/2010 6:17:26 AM PDT by tobyhill
Oil prices have steadily rose over the last year, and experts are worrying further increases could snuff out an already-fragile global economic recovery.
President Barack Obama is expected to announce Wednesday his plan to open oil and natural gas drilling off the Atlantic Coast and Gulf of Mexico. The proposal aims to reduce the nations reliance on foreign oil, which theoretically could hold down prices for U.S. consumers.
OPEC countries also are convening in Mexico this week to map out a strategy for keeping prices from rising higher.
But officials may face an even bigger problem: The recent rise in prices seems to be driven by Wall Street investors not market supply and demand.
Though prices crashed from their peak of $140 a barrel before the recession began in December 2007, they have since recovered substantially. Last year, the price of crude fell to $33 a barrel before a relentless recovery to about $80 by year-end.
(Excerpt) Read more at msnbc.msn.com ...
“takeover to save the poor downtrodden”
You got it!
I agree. The economy can deal with one or two serious crises at a time but a prolonged spike in oil prices when two other pillars have fallen starts the collapse.
I believe another relevant factor was the installment of a Democrat Congress in January 2007. That sent negative signals around the world and began a shift of foreign capital and market holdings away from the U.S.
And now the Democrats want to stop frac-ing, which is essential in the Bakken Shale region of N. Dakota.
By January 2011 the government will run almost everything.
I am like most who took a big whack to the portfolio from roughly 9/08 to 3/09. But when oil went from $140/barrel to $40 a barrel, I saw an opportunity. From March to October of 2009 I spent 3 hours a day studying,reading,trying to understand the market. I was able to trade my way back to even,(plus a little more). I made money on oil,natgas, gold, and silver. I sold my winning positions againt my losers. So it wasn’t Wall St driving up the price, it was me. I confess. But I met my goal of getting rid of my 500 upsidedown shares of GE(NBC,MSNBC) I’m not a Wall St raider gaming the system, I’m a truck driver.
A thought crossed my mind after the take over of the student loan business. Will gunsmithing be banned from being elgible from the student loan program?
Also, it's odd to see someone claim that they "feel" the market-clearing price should be lower (or higher), yet simultaneously claim that others shouldn't feel differently.
Good going
Maybe, or gunowners could be denied medical treatment or have to pay more for treatment. Basically, the more they takover, the more control of our lives they will take.
Anytime there is any announcement coming from Obama and the dems means they have picked their next target for a takeover. They are moving very fast.
There will be no fair elections, count on it.
The price of gas doesn’t really have a lot to do with supply and demand. Yes, it does have some, but the dominant factor in setting the price of gasoline is the market value of oil futures contracts. That is how we can have a 12% cut in gasoline demand over the last 12 months and a 50% increase in the average price of gas in the same period. In this same time, investors have been flocking to oil futures to hedge against a weak dollar. Like someone said above, the Fed (and paranoid, rightly or wrongly, investors) have a lot more to do with the price of gas than the American consumer trends.
And they’ve been doing that for years. Any time you have easy money, the inflationary effects will pop up somewhere.
Then you missed the three or four threads noting that it peaked within hours of Semgroup’s multi-billion wrong-way short position got resolved.
So, in other words, the majority of speculators got it correct?
The Feds are real good about granting drilling rights to areas with no oil.
Help me out here (I'm suffering from a headcold and don't feel up for the mental contortion). So Semgroup bet correctly, but too soon? (Yes, that means it bet incorrectly). So it was buried by margin calls? So does that mean that others conspired to put Semgroup out of business? Does that mean that Semgroup was squashed for predicting what happened?
This "evil speculator" stuff is complicated.
Your initial doubt of whether it was manipulation or not is now apparently resolved to the consensus and the historical record.
In other words, you never got a handle on what happened at Semgroup. I’ll wait for someone else’s opinion.
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