
The Great Oil Price Robbery (Indian story helpful to all) - newacc
http://blogs.economictimes.indiatimes.com/folk-theorem/entry/folk_theorem_the_great_oil
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three14
I wish someone would explain how this is supposed to work. So, speculators bid
up the price of oil from the "natural" price of $30 a barrel to, say, $100 a
barrel. Some of the oil now goes to the speculators. A few months or a year or
two down the line, the speculators have to sell. It costs them money to store
it after they take delivery. Shouldn't the price then fall _below_ the natural
$30 a barrel?

I mean, I know there are lots of speculators in the oil market, but even if
they're all evil geniuses, how will they manage to consistently raise prices
for everyone over the long term? Unless they don't mind hiding away the oil
they bought and never reselling.

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codedivine
Btw aloo=potato and bhindi is another vegetable whose english name i dont
remember currently.

~~~
sharpn
okra

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asdlfj2sd33
There is a glut of credit in the world. Free trade and huge pools of untapped
labor in the developing world have kept inflation in consumer goods and wages
to a minimum.

Not so when it comes to investments. There are thousands of hedge funds who
charge 2/20, that's 2% even if they lose money. Who would give them money?
Lots of people apparently, there must be pent up demand.

And all that credit has to go somewhere, commodities, real estate, stuff like
that.

But commodities, and even real estate are volatile, so there's a lot of
speculation. And what's the benefit of this moneyed activity? There is none.

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apu
Matt Taibbi covered this in great detail:

[http://www.rollingstone.com/politics/story/29127316/the_grea...](http://www.rollingstone.com/politics/story/29127316/the_great_american_bubble_machine/1)

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pmichaud
This is sort of what was happening back when gas was $4 in the states. It
turns out that all those wall street players had a sort of racket going where
each was buying from the last in a long chain.

Those firms collapsed in the crash, their trading stopped, and gas went back
down to >$2.

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dmm
I'm almost certain that symbol means greater-than.

~~~
pmichaud
Yeah, oops.

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modeless
So his argument is that we should ignore all possible risks to our oil supply
and let everyone have cheap oil? That works great until one of those risks
becomes reality, the price of oil instantly skyrockets amid dire shortages,
and we don't have any alternatives because oil was cheaper than all of them.

I hope that none of the people railing against speculators are also
environmentalists, because oil speculators should be an environmentalist's
best friend: nothing could possibly promote alternative energy better than
high oil prices.

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known
It depends on Demand, Supply and Distribution of Cash.

    
    
        Demand     	Cash       	Supply
        Y			Y		Y (USA aka Consumerism)
        Y			Y		N (Dubai)
        Y			N		N (India)
        Y			N		Y (Inflation Under Control)
        N			N		N (Chaos as in Africa)
        N			Y		Y (Deflation as in Japan, Germany)
        N			N		Y (Inefficient Govt and Society)
        N			Y		N (Inflation as in Ethopia)

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known
Futures trading = <http://en.wikipedia.org/wiki/Liar%27s_poker>

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TweedHeads
Everytime hurricane season comes, they start their red alert propaganda on the
news alarming people about how the oil supply from the gulf will be reduced
therefore oil prices will go up.

After hurricane season, prices should go down, but no, it never happens.

Then on winter oil prices will go up again because you know, heating
consumption increases, but it never goes down when the scorching summer
arrives.

Then the middle east.

Then chavez.

Then... [insert alarmist propaganda here]

