Stupid Oil Speculator's are at it again!

[Tempest]

Quote:
Wouldn't the money be better served to the economy by consumers at the lower levels than hedge fund managers ?

The vast majority of people in this (and your) country have money in the stock and other markets. The stock market value has traditionally gone up 10% a year.

Sounds like the "lower level" people are doing pretty well with that as that is much higher than wages typically increase.

If those fund managers weren't good at what they did, the people that pay them money to make them more money wouldn't be getting rich. They are providing a service that a LOT of people want, and they are being rewarded for it.

No different from any other service.

 

[Kaboomba]

To anybody who bashes "oil speculators":

If you buy more oil than you need right now because it is on sale, you are a speculator.

Speculators who make their living on the energy exchange are simply very good at buying lots of oil on sale to sell when the Middle East jacks up prices.

Thanks a bunch, speculators!

Kaboomba

 

[Tempest]

Originally Posted By: Kaboomba

If you buy more oil than you need right now because it is on sale, you are a speculator.

 

[mechanicx]

I don't think that is analogous. that's like saying a consumer that buys bananas when they are on sale is a specualtor in that commodity. the consumer is just taking a sell price not setting it and taking posession, a speculator is not taking possession and is influencing the sale price. We are talking wholesale prices not retail.

 

[Shannow]

Originally Posted By: Tempest
Originally Posted By: ZZman

That is a good start. Also stop the leveraging. If you don't have the money to pay, don't play.

I'll ask you again, what type of investments do you have?


Surely even you tempest can acknowledge that there's a difference in an investor having shares, property, and cash (you can't keep them under your pillow), and holding them as the markets increase in value, versus the leech like pump and dumpers, who make money on the way up, and down the bubble.

If you watch the trades in some penny stocks, there are single shares being traded at 0.1c increments, followed by massive transactions, and then single trades 0.1c the other way...that's not the activitiy of a Mum and Dad investor who pay $20-$30 per trade, and it's not the activity of a savy trader who's taking advantage of uncertainty in the market...it's manipulation.

 

[mechanicx]

I agree. I'm not so much against the speculators making money and adding no value if they'd be honest and admit it, but when they tell you they are doing you a favor that is beyond the pail.

Anyway, the article says speculators are the reason oil prices are going up, and speculators are not causing it to go down. I would tend to agree with that since they generally make money by rising prices. Others are saying speculators are doing everyone a favor and keeoing price down. So someone most be wrong.

 

[Tempest]

Originally Posted By: mechanicx
I don't think that is analogous. that's like saying a consumer that buys bananas when they are on sale is a specualtor in that commodity. the consumer is just taking a sell price not setting it and taking posession, a speculator is not taking possession and is influencing the sale price. We are talking wholesale prices not retail.

The speculator DOES own it (or the rights to it) once he has completed the contract. Doesn't matter if he physically takes possession or not. Have you ever bought something with intent to sell it?

The purchase of products DOES affect the price. That's the demand side of the equation. So to say the consumer is just taking a price, that is not correct, as the consumer will not buy if the price is too high.

 

[Tempest]

Quote:
Surely even you tempest can acknowledge that there's a difference in an investor having shares, property, and cash (you can't keep them under your pillow), and holding them as the markets increase in value, versus the leech like pump and dumpers, who make money on the way up, and down the bubble.

What makes you think the mutual funds, that ordinary people are in, aren't doing that? In fact, they better be to maximize the returns to the people paying them. Or would you rather have them lose your money by not adapting to market conditions?

If there is illegal manipulation, then it's up to law enforcement to take care of the problem.

 

[ZZman]

Originally Posted By: Tempest


I'll ask you again, what type of investments do you have?


Mostly bonds right now in the accounts I have control over. My work one I have no idea.

 

[ZZman]

Originally Posted By: Tempest


The purchase of products DOES affect the price. That's the demand side of the equation. So to say the consumer is just taking a price, that is not correct, as the consumer will not buy if the price is too high.


That is what I am saying. Let true demand set prices. Not "manufactured" demand. Any little bit of news good or bad or the fact that the dollar is down so we should buy oil as an investment is not true demand.

I disagree that the consumer will not buy. We want our oil and our vehicles. We want our toys. We the consumer will panic and buy if we hear news oil/fuel is going up. This is not like other commodities like oranges that I can just choose not to buy if they get way overpriced.

 

[Steve S]

IMO so few control what so many purchase that monopolies exist.

 

[Tempest]

Quote:
That is what I am saying. Let true demand set prices. Not "manufactured" demand.

So you want to ban car dealerships? They are middle men that take possession of an item and resell it to make money.

They buy cars from the manufacturer and speculate that they can sell them at a profit.

 

[genynnc]

Quote:
Maybe if the economy were allowed to improve, the speculators would find something else to invest in? With everything else being so far down, with no real uptick in sight, investors are looking for something.


This is truth well spoken.

Quote:
Shorting ?
where's the productive benefit and efficient market in that?


Shorts are productive. Look at Bear Stearns, look at Lehman, look at Enron.. the shorts told the truth when everyone else was ‘speculating’.

Quote:
That is what I am saying. Let true demand set prices. Not "manufactured" demand. Any little bit of news good or bad or the fact that the dollar is down so we should buy oil as an investment is not true demand.


So, if externalities affect the dollar, then gold should not fluctuate? I don’t understand the difference you are making in commodities here (i.e.-gold vs oil)? And demand is demand. If someone is looking to buy something, that is demand, right? Doesn’t matter if he keeps, sales, or uses it 10 days later.

 

[ZZman]

Originally Posted By: Tempest

So you want to ban car dealerships? They are middle men that take possession of an item and resell it to make money.

They buy cars from the manufacturer and speculate that they can sell them at a profit.


And they will. But it will vary. There is a difference between new cars and oil. I can chose to not buy a new car if it costs too much. (Which I do) I can chose to buy a used car instead or keep driving the one I have. I can not chose to buy used oil or not buy oil/fuel at all. I have to have fuel to get to work, the country needs oil to run.

There is no real competition or alternatives to Oil/fuel.

That makes it unique.

 

[ZZman]

Originally Posted By: genynnc

So, if externalities affect the dollar, then gold should not fluctuate? I don’t understand the difference you are making in commodities here (i.e.-gold vs oil)? And demand is demand. If someone is looking to buy something, that is demand, right? Doesn’t matter if he keeps, sales, or uses it 10 days later.


I could care less about the price of gold. I don't have any and don't need it. You and I and everyone else does need oil and fuel. We are all affected by it.

 

[Tempest]

Originally Posted By: ZZman

And they will. But it will vary. There is a difference between new cars and oil. I can chose to not buy a new car if it costs too much. (Which I do) I can chose to buy a used car instead or keep driving the one I have. I can not chose to buy used oil or not buy oil/fuel at all. I have to have fuel to get to work, the country needs oil to run.

There is no real competition or alternatives to Oil/fuel.

That makes it unique.

So what is your solution?

 

[ZZman]

Producers set a fair price and people pay it.

Lets say it is between 75.00-80.00 a barrel. Then it stays at that price for a year contract. Over production or under production does not change the price. It is what it is. Then when that is up the price is determined again.

This is fair for both consumers and producers as the pricing stays consistent. (Don't you hate all this price fluctuation?)

It is rare that we have ever not had enough oil for anyone who wanted some.

 

[Tempest]

It was a $100 a barrel just a few months ago... Why do you now believe it should be $75?

So if the oil should be fixed for a year, there is no reason to make more gas when demand goes up in the summer months. This will lead to shortages in the summer, and over supply in the winter.

You see, price is an indicator to producers as to how much to produce.

If your plan will work for oil, why not just use the same price fixing for all products?

 

[PandaBear]

In a normal market for commodities that are not in a monopoly like oil, there will be increased demand when the prices goes up. However we all know that oil is controlled by OPEC and people use it as gold to hedge against investment risk. When you think about it, why does gold and diamond have any value higher than lead? Because people believe they hold value, therefore they hold value. The same goes for oil in a short term investment.

I think it is important that investors can hedge against commodities to make money by providing stability to price. However, when most oil transaction and oil storage in reserve are done by investment banks (Goldman in particular), they are no longer just a small market participant, but a market maker. This is the same reason why government break up companies that try to dominate market by defrauding consumers and sometimes producers.

IMO maybe we just need to do our part to hedge against this risk and volatility by using less even when it is cheap (i.e. buy smaller cars), it's the only certain way to protect against the uncertainty of another oil spike, because we know how countries can go to war for oil and now China and India is going to use even more as they get richer and US dollar gets cheaper, and there is nothing you can do about that.

 

[Tempest]

Quote:
there will be increased demand when the prices goes up

I think you got that backward.