User Panel
User Panel
User Panel
|
Posted: 6/7/2008 12:13:54 AM EDT
The price of oil and gasoline is NOT supply/demand based.
www.breitbart.com/article.php?id=D914R9VG0&show_article=1
Fix Bayonettes Forward Who wants to take bets that George Soros (sp?), members of the Builderburge group (sp?) and other rich, american hating communists (like the hildabeast and obama) are in on this too? Trying to force our economy into a tail spin... to help force socialism on us. 
|
||
|
|
|
Posted: 6/7/2008 12:26:14 AM EDT
[#1]
wouldn't surprise me one bit.... |
|
|
|
|
Posted: 6/7/2008 12:29:30 AM EDT
[#2]
Speculation is as much a part of capitalism as any other. I will never support restrictions on capitalism.
|
|
|
|
Posted: 6/7/2008 12:33:54 AM EDT
[#3]
Soros for all his faults has called the current oil boom a bubble. He isn't a billionaire because he is stupid with money. His politics is another story. Oil traders have some to do with this run but at the end of the day you have two nations coming online(India and China), who need oil to fuel their economies. Meanwhile in the good old US of A we won’t drill in Alaska, off Florida and California and haven't built a new refinery since I was two years old. You reap what you sow.
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/05/26/cnsoros126.xml |
|
|
|
Posted: 6/7/2008 12:35:08 AM EDT
[#4]
Fine , you want to speculate , actually purchase the oil , then store it , then sell it at a profit if you can. Anything else is nothing more than a common numbers game open to being corrupted.
I think that is a fair comprimise don't you ? If you want to be in the oil business you should have the oil. The only value added by speculators is whatever they can spook the sheep into paying.If the commodity is over priced it should sit on THIER SHELVES correct? |
|
|
|
Posted: 6/7/2008 12:37:24 AM EDT
[#5]
What would they have to gain? Even if they do hate America, blah blah, a good parasite does not kill it hosts. |
||
|
|
|
Posted: 6/7/2008 12:52:07 AM EDT
[#6]
South Dakota is going to be the first state in 35 years to open a new oil refinery... Someone got their head out of their ass on ONE of the major issues... Now we just need to replicate that several times over... Personally, I think Michigan would be a GREAT place to start opening oil refineries... |
|
|
|
|
Posted: 6/7/2008 12:53:09 AM EDT
[#7]
Speculators also take great risks. Its just part of the nature of a free market.
Want to blame someone? Blame the US Federal Government for spending so much money that it shook people's confidence in the dollar as a storage of wealth medium. |
|
|
|
Posted: 6/7/2008 1:00:24 AM EDT
[#8]
No, that doesn't fit the situation. They're trading in futures; you don't store a future (unless you're in Terry Pratchett's Discworld setting). They are in essence buying a contract for a certain amount of oil, not the oil itself. |
|
|
|
|
Posted: 6/7/2008 1:11:40 AM EDT
[#9]
So they are worthless humps of flesh serving absolutley no purpose other than collecting or losing 1's and 0's on a computer.yet they have HUGE control over MY everyday life based on nothing but thier word !!! Gottcha!!! Now that makes everything all better now. THEY SERVE NO PURPOSE !!!!!!! ELIMINATE THIS CRAP . If you never actually physically control the commodity , you have no right to be dealing in it .I will never understand how people fall for shit like this. |
||
|
|
|
Posted: 6/7/2008 1:23:39 AM EDT
[#10]
Speculators take risks as much as anyone. They gamble that the price will increase between the time they buy and the time they sell; sometimes they win, sometimes they lose. Recently they've been winning a lot...just like the people in the housing market, until that bubble popped and the housing speculators who hadn't already sold got caught with devalued properties. Speculation provides the liquidity today to make sure that there will be oil flowing tomorrow. Without the ability to trade futures, you run the risk of disrupting supply. And, thankfully, it's not up to you to determine who has the "right" to trade in whatever they choose to trade in. |
|
|
|
|
Posted: 6/7/2008 1:33:53 AM EDT
[#11]
Blah, blah, blah, lets bring back a Communist style command economy to fix all of our economic woes! |
|
|
|
|
Posted: 6/7/2008 1:41:53 AM EDT
[#12]
They are entering a very risky proposition with furtures. Remember that Eddie Murphy flick, Trading Places? Orange juice. Wait, he was a good guy. It was the Dukes... If the value of the dollar had not fallen and had we domestic production that could be instantly restarted. But what happened was we let that domestic production fall by letting the prices fall in the late 1990s. We have at least 10,000 wells that COULD be back in production at 10 barrels per day each. Only it takes a month to get each well back into running order and we don't have but ~600 workover rigs because when the price dropped, those old workovers went into the scrap yard. So we are ~18 months out from getting a 100,000 BPD additional domestic supply. ECONOMICS. Unfortunately, this shortage will pass. In 5 years, those wells will be shutting down again. The ONLY saving grace is many wells will "recover" over time with no pumping. There is considerable produced brine with each barrel. Letting the oil rise means less brine and more oil. But all that steel down there corrodes when not in use. And then there is new wildcatters. Each new well into the smaller fields costs a half million. And these wells will produce 20 BPD for at least 15 years. If the price of oil stays at $130/BBL, these are profitable. But in 5 years when the price drops to $50/bbl, that well is a loss. That is why all the majors like to sink wells into formations where they gush. Little stripper wells are a longshot in profits. |
||
|
|
|
Posted: 6/7/2008 1:43:09 AM EDT
[#13]
These same traders lost big time back in the 1990s. Along with the majors. |
|||
|
|
|
Posted: 6/7/2008 1:48:55 AM EDT
[#14]
Exactly how are we risking "disrupting the supply" They don't HAVE the commodity on hand.They aren't even part of the supply chain.You eliminate them from the picture completely and I guarentee the arabs will keep pumping oil. If the arabs stop pumping oil tommorrow , are the futures traders gonna pull it out of thier ass,or thier non existant stockpile? OH I see now, it just means they won't make any money, oh , woe is me . And everyone else is still screwed. They are worthless leeches on society AND on your precious free market. You guys always say if someone isn't adding value thier job should be eliminated, these fucks are no different. |
||
|
|
|
Posted: 6/7/2008 1:51:06 AM EDT
[#15]
I really doubt it's a socialist secret plan. Think about it, it's these guys who are the ones that will suffer the most were the government to take over. No, these are just some capitalists doing what they do - capitalizing.
It's not a perfect system, but it's the best one we know of. |
|
|
|
Posted: 6/7/2008 1:58:56 AM EDT
[#16]
Investing in an oil company is capitalism , owning an oil company is capitalism , selling oil you don't even have in your possession ( and never intend to have ) is thievery. Or at least legally santioned fraud of the worst kind.
Wanna buy a bridge from me tommorrow , it's not mine yet , but it will be . (fraud) Wanna buy oil from me tommorrow , it's not mine yet , but it will be . (speculation) I'm not seeing a difference myself . |
|
|
|
Posted: 6/7/2008 2:02:27 AM EDT
[#17]
The money they pay today pays for operations ongoing today, which makes sure that there will be oil coming in tomorrow. It's exactly the same as the example of a gas-station owner who hears that gas wholesale prices have gone up and increases his pump-price immediately. The gas in his storage tank isn't any more expensive, but replacing it will be, so he increases the price. Future trading serves the same role.
They're an integral part of the free market  Edited to add:
They own a contract on a certain amount of oil. That contract is bought and paid for, and is then re-sold. It is very simple. Your analogy is totally false, as it does not include the element of possession of the contract. |
|||
|
|
|
Posted: 6/7/2008 2:11:23 AM EDT
[#18]
Futures markets have both hedgers who represent actual customers (in this case the refiners) and speculators who buy "on paper". Speculators must post a bond which like earnest money, offsets the risk of non-delivery. If a speculator bids on a lot at a high price and then cannot find a buyer before the contract is set for delivery, the seller is compensated for that loss of revenue. Now why? Speculators are gambling that the price will go up. Hedgers are buying enough to maintain production. Speculators are therefore a buffer against higher prices. And this one-day escalation (prices had been dropping since Memorial Day) is due to a report claiming futures might rise to $150. So they bumped it up to a $13 discount over that projection. And quite likely, they may be wrong because petroleum demand in Asia DROPS in the summer as their agricultural industry is much less mechanized, meaning less time for people to travel as they are working. |
|
|
|
|
Posted: 6/7/2008 2:13:43 AM EDT
[#19]
The oil companys are paying for todays operations to ensure there is oil tommorrow. the speculators have nothing at stake but legal paper and thier reputation.Niether of which have any real bearing on the physical supply of oil. They are a drag on a free economy as is anyone who doesn't directly interact with the product.They never should have been allowed to do what they do.
The refineries don't give a shit where the oil comes from , hell the consumer REALLY doesn't care. The oil companies say they can deliver and do so. Speculators do nothing. There was high praise here the other night for Walmart cutting out the middle man , yet no one wants to get rid of THESE middle men, when they add no value. Why is that ? |
|
|
|
Posted: 6/7/2008 2:21:05 AM EDT
[#20]
So it's an insuance raquette . With a middle man who covers the refineries financial ass. Seems like if you actually had the money to insure said refinery against financial loss it would be much more simple. (investors ? ) But instead they want to play salesmen as well. but they are salesmen who don't actually have anything to sell. I still say they have no place in the supply line and are unnessesary. |
||
|
|
|
Posted: 6/7/2008 2:22:03 AM EDT
[#21]
High futures pricing can increase supply. That is another function.
|
|
|
|
Posted: 6/7/2008 2:25:56 AM EDT
[#22]
I thought demand increased supply ? Another one we hear all the time. For supply and demand to work it needs to not be tampered with. People don't want government tampering , why should others be allowed to ?
|
|
|
|
Posted: 6/7/2008 2:26:34 AM EDT
[#23]
And their money, don't forget that.
If they were a drag...the market would have already pruned them out. They have a role, and the proof is in the outcome.
Because you do not understand what you are talking about. I do not mean this as an insult, merely a statement of fact. You simply don't understand the market. |
|||
|
|
|
Posted: 6/7/2008 2:36:16 AM EDT
[#24]
Actually I think people have been "made to understand" what certain folks "want them to understand"
 Basic flow of events here 1 - I wanna buy a widget call me person A 2- someone makes a widget call him person B 3- person C says he can sell me a widget made by B 4- person C tells person B he can sell me a widget 5- I get a better price by telling person C to go away and I deal directly with person B. person C adds no value to the widget , he is a parasite in the system. UNLESS he is actually STOCKPILING widgets. Then he could serve a purpose by having ON HAND widgets I want. ONLY THEN is he an actual buffer , legal paper ain't widgets , and promises are worth exactly shit. |
|
|
|
Posted: 6/7/2008 2:43:55 AM EDT
[#25]
People with 401K plans are the real idiots driving up the price of everything on Wall street.
All that money has to go somewhere, first it was stocks, then metals, now oil. |
|
|
|
Posted: 6/7/2008 2:47:36 AM EDT
[#26]
I get the sense that you aren't even making an attempt to understand what we're saying, but whatever, I have another half-hour at work, I can
 for a bit. I shall correct your analogy. You are person A, wanting to buy a widget. Person B is making widgets. Person C is the eeeeeeeevil speculator. You go to Person B and ask to buy widgets. He says they aren't done yet, but he can give you a contract for delivery of widgets at $87 per. You are very  at that price and believe it'll go down if you wait. A week later, you return, $87 in hand, because now you need a widget and can't wait any longer. Person B says, sorry, Person C arrived just after you did last week, bought the contract on all my widgets and paid my asking price of $87 per - now you'll have to deal with him. You go to Person C, who is now charging $100 for the widgets, because people are paying it. You scream and wail and eventually hand over the $100, because you gotta have your widget. Person C smirks and uses your $100 bill to light his giant evil capitalist cigar. Alternatively: Person C guessed wrongly, and finds that the widgets he purchased a contract on at $87 per can only command a selling price of $66 per, because no-one is willing to pay more, or perhaps because a competitor has undercut him. His flood of tears puts out his cigar and you take your extra $21 and spend it on ammo. |
|
|
|
Posted: 6/7/2008 2:48:42 AM EDT
[#27]
Do you understand how bonds work? Essentially the speculators are acting as financers and in return for thier investment they are paid back a nice interest rate. They are lending the oil companies money. If the oil companies don't pay out the speculators can loose thier shirts.
If I want 5 apples and you have 3 apples, where do the other 2 apples I want come from? Demand does not increase supply. The speculators are providing a service to the oil companies and are being compensated for it. |
||
|
|
|
Posted: 6/7/2008 3:02:14 AM EDT
[#28]
In the old days that was IMO a correct way to think. Today with all the corruption, you are so wrong. Insider trading for example. But the typical person is to ignorant of the facts to know this. |
|
|
|
|
Posted: 6/7/2008 3:08:41 AM EDT
[#29]
hell yes it would there are legions of skilled tradesmen here that have been dumped by the big three that could easily make things work smoothly. |
|
|
|
|
Posted: 6/7/2008 3:09:35 AM EDT
[#30]
But if you consistently want more apples than he has for sale, and others do as well, that may encourage him to undertake the expense of planting more apple trees. And if a speculator comes along and offers him a contract for his future delivery of more apples, betting that demand will stay high... 
Insider trading is already a crime, and it is far from limited to commodity futures. While it is a problem, it is not justification for the prohibition of speculation, any more than murders committed with firearms are a justification for banning firearms. |
||
|
|
|
Posted: 6/7/2008 3:39:12 AM EDT
[#31]
Thank you , I understand what they do now far better , I still believe it is tampering, and allows FAR to much opportunity for manipulation. And I still believe the market would function just fine without them.They are parasites.
|
|
|
|
Posted: 6/7/2008 3:55:59 AM EDT
[#32]
I'm tired of hearing "supply and demand." I'm not stupid.
|
|
|
|
Posted: 6/7/2008 4:06:16 AM EDT
[#33]
I demand more supply |
|
|
|
|
Posted: 6/7/2008 4:30:13 AM EDT
[#34]
If they can get past the multitude of lawsuits being generated to stop it.  Anybody want to take bets on how long the greenies/NIMBY's can hold up the construction? |
|
|
|
|
Posted: 6/7/2008 4:35:25 AM EDT
[#35]
Soros and Buffet have both said it's a bubble. Both have said that it will not end soon, end of the year at the earliest. Neither are fools when it comes to money. |
|
|
|
|
Posted: 6/7/2008 4:49:55 AM EDT
[#36]
Both have also been wrong. On this they could be correct, or the price could be up because demand is growing and supply is not.
|
||
|
|
|
Posted: 6/7/2008 4:51:44 AM EDT
[#37]
why don't you say you just don't understand it and leave it at that? |
|||
|
|
|
Posted: 6/7/2008 5:04:30 AM EDT
[#38]
Once, there was an oil futures trader hiding under my bed.
I had to go to the bathroom SOOOOOOO bad, I just went ahead and wet the bed. If I'd gotten up, he would have eaten my ankles. I got beat for it the next morning, by Uncle Dad, and to this day? I HATES me some oil futures traders. </sarcasm> |
|
|
|
Posted: 6/7/2008 5:05:59 AM EDT
[#39]
Some eat the host to death. |
|||
|
|
|
Posted: 6/7/2008 5:12:15 AM EDT
[#40]
Can someone explain the whole process to me ,maybe Keith ?
Let's use Canada as an example since I believe they are 1 or 2 on the list of who we buy oil from. Oil is pumped from the ground in Canada,put in a barrel,or pumped into a holding tank on a ship, then what happens ? Do the refineries in China,India and the US bid on that barrel of oil from a guy representing the Canadian company who produced it ? |
|
|
|
Posted: 6/7/2008 5:13:10 AM EDT
[#41]
 EXACTLY what I was thinking. How the hell is someone going to say speculation should be banned then turn around and piss and moan about the communists?! |
|
|
|
|
Posted: 6/7/2008 5:16:10 AM EDT
[#42]
And demand should be heading south here shortly. India, Malaysia, Pakistan, Indonesia and Taiwan have all cut their subsidies of gas prices. India has done so twice this year. China's demand is higher than normal because of the earthquakes. They need diesel to fuel generators, and they have stockpiled oil and gas for the Olympics. That demand signal won't be there forever either. The other question is how long countries like China, Iran and Venezuela can afford to subsidize oil at these prices? I don't think they can for very long. India, at least, has been increasing gas prices as a pressure relief valve. I wonder if China will do so or if they'll collapse their economy trying to keep gas prices low. |
|||
|
|
|
Posted: 6/7/2008 5:16:23 AM EDT
[#43]
Welcome to that murky ground called "Populism." Wherein all logic, intelligence, and principle is subjugated to a backseat in favor of political expediency. Abandon all hope, ye who enter here. |
||
|
|
|
Posted: 6/7/2008 5:48:20 AM EDT
[#44]
That is why futures trading exists. If it occured the way you described, the price would swing wildly. Futures speculators help smooth that volatility by increasing liquidity in the market. What would happen to the price if only one refiner showed up that day? What if several refiners really just had to have it now? Now how hard would it be for companies to forecast future expenditures and production costs with wild energy price swings? I hope a democratic controlled government cuts out the speculators. It will ensure they never see office again. Speculators provide an extremely important function. The only speculators I have heard good reason to bump out are the institutional hedge funds/sovereign wealth funds, etc. They have produced a huge demand for oil futures based solely on diversification percentages instead of supply and demand. They base their decisions on whether to invest or not solely on x% of a portfolio invested in oil futures, not on whether the fundamentals lead them to believe they will make wild profits on margin(traditional speculators). The market will knock these guys out without interfernce once oil looks like it is in a bearish mode. This will exacerbate the price collapse. |
|
|
|
|
Posted: 6/7/2008 5:57:12 AM EDT
[#45]
I'm not questioning why futures traders do what they do..I'm asking what the process is from the ground to the refinery,and what takes place in that process. |
|
|
|
|
Posted: 6/7/2008 6:01:31 AM EDT
[#46]
couldn't tell ya
|
||
|
|
|
Posted: 6/7/2008 6:04:39 AM EDT
[#47]
I can't wait till the oil bubble bursts. No doubt that prices are not in line with supply and demand. These oil speculators deserve to lose everything. Sooner or later there will be a correction and these people will be sorry when they finances take a dive off a cliff.
|
|
|
|
Posted: 6/7/2008 6:07:04 AM EDT
[#48]
there are buyers AND sellers of these futures contracts. (ie people speculate on the upside and downside) some will win, some will lose, but the smart ones have covered positions and will make good money either way |
|
|
|
|
Posted: 6/7/2008 6:08:26 AM EDT
[#49]
The difference is, they actually own the contract on the oil. They could, in fact take delivery on the oil if they so chose at the price they purchased the contracted amount. You don't actually think that the only people buying futures are traders do you?  Lots of people buy futures, some to speculatively sell and some to ensure that they have access to a commodity at a cost that is fixed today, rather than purchasing on the market which, as we have seen, is very fluid and subject to seemingly overnight increases. Sorry man, the analogy does not work.
|
|
|
|
|
Posted: 6/7/2008 6:09:28 AM EDT
[#50]
their balls should be boiled in the oil they love so much
 !!
|
|
|
Win a FREE Membership!
Sign up for the ARFCOM weekly newsletter and be entered to win a free ARFCOM membership. One new winner* is announced every week!
You will receive an email every Friday morning featuring the latest chatter from the hottest topics, breaking news surrounding legislation, as well as exclusive deals only available to ARFCOM email subscribers.
AR15.COM is the world's largest firearm community and is a gathering place for firearm enthusiasts of all types.
From hunters and military members, to competition shooters and general firearm enthusiasts, we welcome anyone who values and respects the way of the firearm.
Subscribe to our monthly Newsletter to receive firearm news, product discounts from your favorite Industry Partners, and more.
Copyright © 1996-2024 AR15.COM LLC. All Rights Reserved.
Any use of this content without express written consent is prohibited.
AR15.Com reserves the right to overwrite or replace any affiliate, commercial, or monetizable links, posted by users, with our own.
