Free Republic

NEW YORK - The stunning collapse in oil markets accelerated Friday, sending a barrel of crude plunging below $78 as investors grow more pessimistic about resolving a mushrooming global economic crisis. Oil hasn't been this cheap in 13 months — a rare silver lining for consumers amid a rapidly imploding financial landscape.

Caveat: None of the following is to be relied upon by anyone for anything. Anyother words, I have no idea what is going to happen in the financial markets, and if anyone tries to tell you differently, they are a bloody fool!!! That said, before going to law school, I was a stockbroker (I know, I know, next it is selling used cars). I remember looking at my Quotron in 87 and seeing the Dow drop 25% in one day! Never paid much mind to the charts (was always zeroed in on fundamentals).... BUT, recently, when I looked at the...

No confirmation on this, no tip, no hint. But I know what he's doing. John McCain is waiting until the bill passes. And then he will unleash the dogs of war.

Bailing Out The Oil Market William Pentland, 09.23.08, 11:35 AM ET While everyone knows the U.S. government is looking to bail Wall Street banks, few people realize that it's also bailing out speculative oil and commodities traders in the process, fueling a sharp rise in energy prices. Lehman Brothers and AIG held enormous trading positions in commodities markets. If those positions had been liquidated suddenly, the price of everything from wheat to oil would have collapsed. The Commodity Futures Trading Commission, the main regulator of U.S. commodity markets, allowed Wall Street's investment banks and trading companies to take control of...

McCain will play the proactive role. Obama will come to Washington, but will keep one foot outside the Beltway. Even though the president has called both candidates to Washington to save the country, Obama continues to campaign. Politics as usual. He doesn’t want to cancel the debate. He would debate while the markets burn. McCain is going to work while Obama is phoning it in. Oddly, McCain and Obama agree on the bailout package. But it is only McCain who can pass the bill. Only McCain can deliver the administration and the Republicans. McCain will be at the center of...

Commodities ravaged as traders flee risk Leo Lewis, Asia business correspondent Surging fears of Armageddon in the global financial system ravaged a wide selection of commodities across Asia as groups ranging from hedge funds to day traders spent the day in a headlong flight from risk. The shock waves from the bankruptcy of Lehman Brothers reverberated through markets for vegetable oil, soy beans, rubber and industrial metals as confidence in the financial system faltered, global growth prospects dimmed and cash became king. Broad baskets of commodities — once seen by speculators as a sure-fire bet because of China and India’s...

Big jump in gold sale spurs manipulation talk Some analysts say only manipulation is government's attempt to take down oil By Moming Zhou, MarketWatch Last update: 7:54 p.m. EDT Aug. 29, 2008 NEW YORK (MarketWatch) -- Recent heat from Congress and regulators, along with public speculation, over whether commodity prices are being manipulated has also reached gold pits, where the debate was stirred by a surge in bets last month that gold prices would fall. "Congress is already investigating allegations of manipulation in the oil market, and it seems likely that it is only a matter of time before a...

A Few Speculators Dominate Vast Market for Oil Trading By David Cho Washington Post Staff Writer Thursday, August 21, 2008; A01 Regulators had long classified a private Swiss energy conglomerate called Vitol as a trader that primarily helped industrial firms that needed oil to run their businesses. But when the Commodity Futures Trading Commission examined Vitol's books last month, it found that the firm was in fact more of a speculator, holding oil contracts as a profit-making investment rather than a means of lining up the actual delivery of fuel. Even more surprising to the commodities markets was the massive...

A few speculators dominate vast oil market Regulators: Swiss energy firm holds 11 percent of contracts on NYMEX Regulators had long classified a private Swiss energy conglomerate called Vitol as a trader that primarily helped industrial firms that needed oil to run their businesses. But when the Commodity Futures Trading Commission examined Vitol's books last month, it found that the firm was in fact more of a speculator, holding oil contracts as a profit-making investment rather than a means of lining up the actual delivery of fuel. Even more surprising to the commodities markets was the massive size of Vitol's...

An exhaustive, eight-year Media Research Center study of the Big Three TV networks’ coverage of Barack Obama shows that their favorable spin on the Democrat gave him his margin of victory in the primaries, according to MRC president Brent Bozell. The MRC notes that this year saw the closest nomination contest in a generation, with just one-tenth of a percentage point — 41,622 votes out of more than 35 million cast — separating Obama from Hillary Clinton when the Democratic primaries ended in June. “But Barack Obama had a crucial advantage over his rivals this year: the support of the...

$65 oil is coming (maybe) A top analyst expects crude prices to start plummeting. If you don't believe it, you're not the only one, and a few stocks look good if you're in the skeptics' camp. By Jon Markman If you're frustrated over the high cost of gasoline at the pump, don't trade in your Hummer for a Vespa just yet: A leading energy analyst is telling clients these days to prepare for crude oil to retreat back below $65 per barrel over the next three years. How could it happen? He says conservation, new drilling, efficient new vehicles, alternative...

I'm not much of a believer in conspiracy theories. I've seen up close and personal how wrong they were in the case of my old boss, Richard M. Nixon. He was not a criminal mastermind. He was not paying attention to a bunch of juvenile delinquent aides and they did him dirt. It was a case of an absent minded father, not a KGB plot. But every so often something happens in the world of finance that is at least a bit like a conspiracy. The Drexel-Milken junk bond fraud was a conspiracy, at least as I saw it (though...

WASHINGTON (Reuters) - The U.S. Senate is unlikely to pass legislation aimed at reining in excessive energy speculation before lawmakers leave for their month-long August recess, a top Senate Democrat said on Monday. The legislation sponsored by Democrats to provide the Commodity Futures Trading Commission with greater oversight of energy futures markets stalled Friday when it failed a key procedural vote. Bingaman said Republicans blocked the bill because they were not allowed to add an unlimited number of amendments to the bill. Democratic and Republican lawmakers seem to be deadlocked on passing energy legislation. Republicans are pushing to lift bans...

CHAMPAIGN, Ill. — Proposals to reign in wallet-draining gasoline prices by curbing speculation in oil markets would likely increase costs at the pump instead of trimming them, a University of Illinois economist says. Scott Irwin argues congressional efforts to curb trading by speculators is a “misguided witch hunt” that ignores the root of America’s energy problem – a finite global oil supply that has been stretched thin by surging demand in China, India and other developing countries. “We need to have a real national debate about issues related to both the demand side and the supply side of our energy...

WASHINGTON, July 25 (Reuters) - U.S. legislation to rein in excessive energy speculation failed a key procedural vote on Friday to move forward in the Senate, and now lawmakers will set aside the bill to consider other legislation. The House of Representatives may take up its own anti-speculation bill next week, and then lawmakers will get ready to leave for their month-long recess in August. Sixty "yes" votes were required in the 100-member Senate for the bill to move forward, but the measure received only 50 "yes" votes and 43 lawmakers were opposed.

In 15 years the Clintons have never been this far removed from the limelight. Im guessing that Denver will be something special to watch. Here's betting the notorious Michelle tape appears or a super delegate fight breaks out. I don't trust them a one bit! Your thoughts.

WASHINGTON -(Dow Jones)- Expecting to lose an estimated $10 billion this year because of skyrocketing fuel costs, chief executives of the country's biggest airlines Wednesday resorted to begging their customers to press Congress for tougher regulation of energy markets.

Without a doubt, crude oil is the most important commodity on our planet. Hypothetically if it vanished overnight, our entire modern world would collapse. No goods could move without the oil-derived transportation fuels, so virtually all trade would implode. Unlike nearly every other major commodity, there is just no economically-viable substitute for oil. And the fundamentals driving oil’s secular bull are unparalleled in their strength. As Asia awakens and enters the modern era, global demand for oil is rising relentlessly. Despite today’s unprecedented prices, demand remains strong all over the world. And of course once oil is burned, it is...

Sen. Obama's plan to attack the "oil speculators" who are "driving" up the price of oil by regulating futures contracts on American oil may not be pandering (America certainly cannot, for example, regulate oil futures on Nigerian crude in Switzerland), but it is sure close, and here is why, and I'm sure all those people who helped him draw up this plan know it.

Limiting speculation would push prices to fundamental level, lawmakers told. WASHINGTON (MarketWatch) -- The price of retail gasoline could fall by half, to around $2 a gallon, within 30 days of passage of a law to limit speculation in energy-futures markets, four energy analysts told Congress on Monday. Testifying to the House Energy and Commerce Committee, Michael Masters of Masters Capital Management said that the price of oil would quickly drop closer to its marginal cost of around $65 to See full story. There are two kinds of speculators in the futures ma$75 a barrel, about half the current $135....

Every dogma has its day, and so it is with the posturing that blames the run-up in oil prices on "speculators." The new political consensus is that further "common-sense regulation" of the energy futures market is necessary. Let's grant that the sentiment is common, but the sense – like the evidence – is nonexistent. On Sunday, Barack Obama rolled out a proposal that will supposedly thwart market manipulation by "a few energy lobbyists and speculators." John McCain chimed in that Mr. Obama was merely following his lead; The futures market may be a convenient scapegoat, but it's simply a price...

WASHINGTON -- Speculative traders' interest in crude oil has grown to the point that they now account for roughly 70% of all trading in West Texas Intermediate crude on the New York Mercantile Exchange, compared with 37% in 2000, according to an investigation by a congressional subcommittee that forms part of an escalating political assault on Wall Street's role in the run-up in oil prices. The subcommittee's findings, based on data obtained from federal commodity-futures regulators, are the latest sign that Washington is gearing up to try to limit the role of hedge funds, investment banks and other speculative traders...

The chart above shows that open interest (volume) for crude oil futures contracts declined by more than 16% since last November, and yet oil prices kept going up. Less oil futures trading, less speculation, but higher oil prices? Isn't is supposed to be the other way around?

This week, the Associated Press reported that a recent Israeli military exercise may have been intended to show the nation's abilities to attack Iranian nuclear facilities.The International Herald Tribune called it a "major military exercise" that "appeared to be a rehearsal for a potential bombing attack on Iran's nuclear facilities," with more than 100 F-16 and F-15 fighters joining the maneuvers over the eastern Mediterranean earlier this month.The reason for this training mission is Israel's belief that Iran is attempting to build nuclear weapons that could be used against it. Iran – whose president, Mahmoud Ahmadinejad, has vowed to wipe...

ollowing up on previous posts in the past couple of days about Barack Obama’s “birth certificate,” here and here, I became more curious about Barack’s mother, Stanley Ann Dunham (known as “Ann”), and spent several hours reading about her. In particular, I was searching for information about the circumstances surrounding Barack’s birth. It seems reasonable to ask at this point: Is it possible that Barack Obama, Ann’s son, was born someplace besides Honolulu? Here’s a rough sketch of what I’ve pieced together so far based on information available on the Internet, but I could use some help filling in the...

One of the biggest factors in high oil prices, according to many experts, is that investors, such as hedge funds and investment bankers, can use loopholes in commodities law to manipulate the market and drive crude oil, heating oil, gasoline and diesel fuel prices to new heights. Congress is aware of the problem and lawmakers recently passed legislation to address the “Enron Loophole,” one of the major loopholes that opens the door to abusive trading practices, but the law didn’t go far enough.

Buying into 'the petroleum for the next century' ROB CARRICK Friday, June 13, 2008 Looking to jump into an investment in a scarce resource with lots of upside potential? There's a clear case to be made for water. Oil and gas, metals and fertilizers and food are still going strong, while investors have only recently started to talk about water. And yet, water has much the same imbalance between supply and demand as traditional resources. The investment dealer Goldman Sachs recently described water as the “the petroleum for the next century.” Mutual funds and exchange-traded funds focusing on water have...

Why Can’t Our Media and Politicians Get The Oil Story Right? Of course the answer is quite simple! Our pathetic media and politicians can’t get it right because they don’t know how to analyze a market. After all, how many of them have actual experience in managing a client’s portfolio or traded a futures market? The problem is that their ignorance is having an outlandish impact on our lives as their ineptitude to understand and present the facts might very well lead to policies that will substantially hurt this country’s economy for a long time to come. We have precedence...

NEW YORK (Fortune) -- High-flying tech stocks crashed. The roaring housing market crumbled. And oil, rest assured, will follow the same path down. Not everyone agrees. In an echo of our most recent market frenzies, some experts pronounce that the "world has changed," and that the demand spikes, supply disruptions, and government bungling we face now will saddle us with a future of $4, $5 or even $10 a gallon gasoline. But if you stick to basic economics, it's clear that the only question is when - not if - prices will succumb.

More on the possible contribution of index fund investment to recent commodity price moves. We and many others have been discussing whether the surge in investment fund purchases of long positions in commodity futures contracts may have been a factor contributing to the spot prices of those commodities beyond what would be warranted by considerations of physical supply and demand. John Mauldin shares an interesting graphic from Deutsche Bank researchers, showing that the prices of a number of commodities in which no futures market exists have increased even more dramatically than those traded on major exchanges.

Bursting the Speculative Bubble - May 30, 2008 The Bubble may be ready to burst. The CFTC pushed by Congress may be sharpening the point on the pin that bursts the price balloon. Futures, Institutional Investors and Oil Prices. The volume of email commenting on the Michael Masters testimony before the Senate was surprising to say the least. While we disagree with some of his comments comparing the number of futures contracts to physical barrels, we do agree with the basic analysis and believe it helps explain some of the oil price increase over the last few ears. Since all...

Ready for the Oil Bubble? Source: http://www.star-telegram.com/104/story/651928.html ------------------------------------------------------------ One law is causing prices to go through the roof By Ed Wallace Special to the Star-Telegram "There’s a few hedge fund managers out there who are masters at knowing how to exploit the peak [oil] theories and hot buttons of supply and demand and by making bold predictions of shocking price advancements to come, they only add more fuel to the bullish fire in a sort of self fulfilling prophecy." — National Gas Week, Sept. 5, 2005 as reprinted in the US Senate Permanent Subcommittee on Investigations’ report, "The Role of...

I’ve long been a bear on oil and energy as an investment thesis — Simply put, the end product of all energy is totally commoditized and every player in the business is totally beholden to the vagaries of the market to set the price of that end product. Intel gets to choose how much to price their processors for. And they’ve kept gross margins far above 50, 60% regardless of the cycles playing out in the broader economy. I like to invest in businesses that have lots of defend-able proprietary technologies and/or strategies in their business model. Google’s another great...

WASHINGTON - Market speculation on energy prices may have added as much as 10 percent to crude oil costs and the peak may be yet to come, a top Energy Department official said Tuesday. Guy Caruso, head of the department's Energy Information Administration, told a Senate hearing that supply and demand would suggest a price of about $90 a barrel. Prices fluctuated around $102 a barrel Tuesday — although futures prices later dropped below $100 a barrel on the New York Mercantile Exchange — on word that the Organization of Petroleum Exporting Countries are likely to keep production as is...

My blogs attract some very interesting readers due to their lack of real estate cheerleading. It has always been my intent to be direct, straightforward, present the facts, and let my readers make up their own minds about current Boise real estate market conditions and activity. I was recently asked by a major lender investigating loan fraud in the Boise real estate market to help analyze the number of vacant home listings in our market. This was the second time I have been contacted by a lender who subscribes to my blog who was looking into suspicious loans in the...

NEW YORK-Wells Fargo & Co (WFC.N), the second-largest U.S. mortgage lender, said on Tuesday it would take a $1.4 billion fourth-quarter charge largely related to losses on home equity loans as the nation's housing market deteriorates. The company, which is also the fifth-largest U.S. bank, said it also was significantly scaling back making home equity loans through brokers, citing a need to tighten lending standards and reduced demand from investors to buy the loans. Wells Fargo had said in July it would stop making subprime home loans, which go to people with weaker credit, through brokers. Shares of Wells Fargo...

No one knows how severe the slump will be, but economists and real estate experts interviewed by The Times, and who were willing to make predictions, said prices could fall 15% to 25% before turning back up. Most said values would continue falling through at least next year, and some thought the market wouldn't reverse course until 2010. That could translate to big declines for home buyers who bought at the peak of the market, which various measures place in late 2006 or early 2007. For example, a home that sold for $800,000 in 2006 could fall to $600,000 over...

Let me the first to predict the republican ticket for 08. GIULIANI-HUCKABEE. Do I like it? not really. Whom do the Freepers that are in the real world (I'm outside CONUS) and get their news from other sources besides CNN and Al-Jazeera think the candidates will be.

NovaStar Financial shares sank by roughly half Thursday after the company, which has halted subprime mortgage lending, posted a big quarterly loss and said bankruptcy is possible. The company late Wednesday posted a $598 million third-quarter loss, or $64.05 per share. Results reflected a nearly ten-fold increase in bad loans, mortgage write-downs, higher legal bills, a charge to end the company's real estate investment trust status, and other items. Profit a year earlier totaled $25.3 million, or $2.91 per share, NovaStar said. In its quarterly report filed with securities regulators, Kansas City, Mo.-based NovaStar outlined several scenarios under which it...

A frantic two-hour auction Saturday in downtown Fresno was a sign of the times as bidders snapped up 48 new houses -- most for thousands of dollars below the builder's original list price.

NEW YORK (Reuters) - For a man who insists he is not running for president, New York Mayor Michael Bloomberg is the subject of much recent speculation. Newsweek's latest issue carries a cover story on the businessman-turned-mayor in which a top aide, Kevin Sheekey, refers to an independent Bloomberg presidential run: "If it happens, it's a billion-dollar campaign." The fact that Bloomberg is quoted in the same piece saying "I am not running for president" seemed to do little to calm the waters. Another news report analyzed his shifting answers -- moving from "I'm not running" to "I'm not a...

French president warns US it cannot allow currency to collapse as Europe suffers from euro's rise. The French president, Nicolas Sarkozy, has warned the United States Congress that the US risks triggering "economic war" if it attempts to devalue its way out of trouble by allowing a relentless slide in the dollar. The stunning remarks came as the greenback plunged to a record low of $1.4731 against the euro, causing a chorus of angry protests from industrial leaders in France and Italy. The dollar breached $2.10 against sterling for the first time since the early Thatcher years in 1981. On...

Is it just me or are we all getting pretty tired of FNC’s abuse of “Breaking News” and “News Alerts”? It amazes me that you can’t watch one day’s worth of programming on America’s “fair and balanced” network without being assaulted by these false overtures. The producers at the FNC must think we are the dumbest viewers in the history of television news. The recent fires in Southern California provided almost every anchor on Fox with the opportunity to over-dramatize the events of the day. I’ve never seen so many “Breaking News” reports on one story in my life. And...

NEW YORK (AP) -- U.S. home prices fell nationwide in August for the eighth consecutive month, according to the S&P/Case-Shiller index released Tuesday. And things could get worse, said Yale economist Robert Shiller, who helped create the index. "There is really no positive news in today's report," said Shiller, chief economist for MacroMarkets, which collaborated with S&P on the indicator. Home prices as measured by the index have fallen more every month since the beginning of the year. August is the 21st month of decelerating returns. An index of 10 U.S. cities fell 5 percent in August from a year...

<p>America’s mortgage crisis is likely to get considerably worse because the level of fraudulent lending to unsuitable borrowers was much higher than previously estimated, Standard & Poor’s said yesterday.</p> <p>David Wyss, the ratings agency’s chief economist, said that defaults on high-risk “sub-prime” mortgages would continue to soar as unqualified mortgage-holders struggled to meet their repayments, tightening the credit markets and dragging down the American economy.</p>

NEVADA, Iowa: The ethanol boom of recent years — which spurred a frenzy of distillery construction, record corn prices, rising food prices and hopes of a new future for rural America — may be fading. Only last year, farmers here spoke of a biofuel gold rush, and they rejoiced as prices for ethanol and the corn used to produce it set records. But companies and farm cooperatives have built so many distilleries so quickly that the ethanol market is suddenly plagued by a glut, in part because the means to distribute it have not kept pace. The average national ethanol...

After perusing the blizzard of U.S. economic data that we've gotten this week, you could easily—and quite plausibly—draw this megaconclusion: The Federal Reserve will cut interest rates again, inflation is under control, and while the economy is weakening, it won't slip into recession. Here is the evidence: 1) Yes, the housing market is still dreadful. New-home sales in August hit their lowest point in seven years and are down 21 percent from a year ago. But don't forget that housing is less than 5 percent of the total economy. It's not the whole ballgame. 2) Employment remains amazingly resilient. Initial...

Bin Laden may have just escaped U.S. forces August mission in Tora Bora almost snared 'high value target' A little more than a month ago, with the anniversary of Sept. 11 approaching and fears of a new al Qaeda attack rising, some U.S. intelligence and military analysts thought they had found one of the world’s two most wanted men just where they last saw them six years ago. For three days and nights — between Aug. 14 and 16 — U.S. and Afghanistan forces pounded the mountain caves in Tora Bora, the same caves where Osama Bin Laden had hidden...

...In April, daily turnover in currency markets rose to $3.2 trillion, the bank said yesterday. That's more in value than the annual economic output of Germany or China, changing hands in currency markets every day around the world. It's also up 71% from the BIS's last survey in 2004, the largest jump in volume since the institution began conducting its benchmark survey in 1989. The currency market is "the world's biggest fruit and vegetable stall," says Jim O'Neill, global head of economic research at Goldman Sachs Group Inc. "There are so many participants in it, and it adjusts very quickly...

NEWARK, N.J. - Hovnanian Enterprises Inc., struggling like other home builders, is offering six-figure discounts on some of its properties this weekend as it attempts to draw interest in a slumping market. The sales blitz involves dropping prices by more 20 percent on some of its prime real estate. The largest discounts are on the most expensive homes, including a 3-bedroom condominium by the Hudson River in West New York, which has been reduced $240,000, or 22 percent, to $862,000 this weekend. A 25-percent discount is being offered on a 2-bedroom home in Jackson Township, N.J., which lowers its price...