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Why are "oil speculators" allowing the market to..

Discussion in 'Politics, Elections & Legislation' started by mrskeet410, May 11, 2011.

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  1. mrskeet410

    mrskeet410 TS Member

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    If "speculators" control the oil market to drive up prices, why are they allowing the prices to dive?
     
  2. Catpower

    Catpower Molon Labe TS Supporters

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    Why are

    Buy low, sell high

    And that's the end of this lesson
     
  3. guido

    guido Member

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    Why are

    Because they can!!!
     
  4. Stl Flyn

    Stl Flyn Well-Known Member

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    Why are

    Oil is denominated in dollars. The dollar rises, oil (commodities) fall. The dollar falls, oil prices rise. Gasoline could be manipulated, because of the futures market. Oil is more driven by the dollar.
     
  5. halfmile

    halfmile Well-Known Member

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    Why are

    Dumb.

    Commodity trading is a zero sum game. At the end of the day all contracts are settled.

    For every "speculator" making money there is one losing money.

    If no one wants to sell the price goes up, till someone does.

    They do have "limit" restrictions, so that there are not any wild swings.

    In other words, a commodity (gas, hogs, corn, whatever) can only go up or down the amount of the limit each trading day.

    NO one "allows" prices to dive (or climb) since every seller is matched with a buyer. Yes, you could hold up a price if you had VERY deep pockets and worked a corner on the market.

    That hasn't happened for years. Nelson Bunker Hunt tried it with Silver and lost a trainload of money. He thought he was going to create a new currency and part of his plan was to corner the silver market. He never counted on the amount of silver that came out of all the closets and attics once the price was way up there. the bubble collapsed when he ran out of money and there was still silver out there to buy.

    The above link gives a good explanation of how it works. It does not, however tell you what to do when you hold a big losing position and you wake up in the middle of the night with chest pains.

    So call a good broker, and set up an account. You too can be a "speculator".

    Happy trading and when you need to sell your guns to meet a margin call contact me.

    HM
     
  6. Stl Flyn

    Stl Flyn Well-Known Member

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    Why are

    Supply and demand may be the cause of quick swings in the market, but the dollar is the underlying cause of the oil prices direction.
     
  7. Pull & Mark

    Pull & Mark Well-Known Member

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    Why are

    Because, Whatever goes up "Must" come down. Just like everything else in life. Yen/Yan. Break-em all. Jeff
     
  8. Stl Flyn

    Stl Flyn Well-Known Member

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    Why are

    Halfmile,

    When you say that all contracts are settled at the end of the day, what do you mean? Futures contracts have delivery dates at the end of the contract month. During that time prior you can sell or buy any contract you wish. I guess I do not understand your point.

    Speaking of tax cuts for large oil companies. Do any of you remember when the large oil execs. testified in congress, the last time oil prices were this high? They told congress to take back the tax cuts given to them with President Bush's tax cuts. They said they did not need them. The congress and President Bush refused to do that, because it was part of the overall bill. Huh, sounds like fuzzy math to me. Now, some of you are posting that the high oil prices are Obama's fault. Do you people really realise how hypocritical you actually are. Stop the political b.s. All it is doing is inflating your own head. That's it.
     
  9. Stl Flyn

    Stl Flyn Well-Known Member

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    Why are

    Rick,

    You are correct with your analysis of procedure.

    I sure hope you are not saying that the majority Democrats wrote the tax cut bill, that included the cuts to the big oil, are you? Those cuts were part of the tax cut bills signed into law during the Republican control of both the House, Senate, and Presidency of George Bush, from 2001 to 2006 I believe. Part of the corporate tax cuts of 2004 in particular. Read the link above. Kind of interesting if you look at the numbers toward the bottom. Remember we were already into the Iraq war for more than a Billion dollars at this time(2003). Seems we are going through the same thing right now. Raising the debt ceiling, etc. Jon

    Update: Raising the debt ceiling while cutting income (Taxes). Seems to me that they (Republicans) were spending more (Raising debt limit), and bringing in less (Tax cuts). Sound like what the Democrats would do, and be accused of now, Correct? After all, President Obama signed the extention of the tax cuts. Did he not? Jon
     
  10. skeeljc

    skeeljc Supporting Vendor Supporting Vendor

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    Why are

    Because the CME Group raised the margin rate. When margin rates go up investors are forced to sell something to raise the additional cash to cover the higher margin.

    Jim Skeel
     
  11. over/under

    over/under Member

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    Why are

    Bush's fault, just ask Hussein Obama.
     
  12. Stl Flyn

    Stl Flyn Well-Known Member

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    Why are

    That is kind of what I thought. It seems like all of Bush's policies and more are still in place. Read further. Jon
     
  13. Luckyman

    Luckyman Active Member

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    Why are

    If you look at it from a libs point of view considering how many Bush policies Obummer kept in place they should be furious with Obummer especially if their argument is to blame Bush and his policies? I think that's their argument isn't it?

    GITMO, Patriot ACT, Afghanistan, Extending Bush Tax Cuts...etc. etc. These people must REALLY be confused right now...I know they are always confused but this must cause them to be really really really confused..LOL!
     
  14. Hoosier Daddy

    Hoosier Daddy TS Member

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    Why are

    There are more than just the big oil companies that benefit from the tax breaks or how ever you want to call it. The little one well people that count on the breaks to exist are also included. With out the break they couldn't exist. Or so they tell me.
     
  15. Catpower

    Catpower Molon Labe TS Supporters

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    Why are

    Yup increase the taxes , I'm sure the oil companies will just sit back and take it, they would never do what every other business does, pass the taxes to the consumer

    The only way oil will come down is to drill, explore, and produce, it's that simple, if there's glut on the market, the price will come down
     
  16. 221

    221 Banned User Banned TS Supporters

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    Why are

    catpower, that's not going to happen, oilmen don't think like farmers. No one in the oil business would be foolish enough to create a situation where they give a precious resource away. The only way it could work is if the government would seize all US resources.....How do ya think that would work.

    And as to why....WHY YOU ASK.....because a very large group of people live off the funds generated by speculation. Like those that retire, with a guaranteed pension. Without speculation most pension funds would collapse. We really have created a monster.
     
  17. Stl Flyn

    Stl Flyn Well-Known Member

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    Why are

    Read this article. There is your reason.
     
  18. Stl Flyn

    Stl Flyn Well-Known Member

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    Why are

    Here is some more for your reading pleasure. Click the link.
     
  19. dbcook

    dbcook TS Member

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    Why are

    ask the mormons in utah that owned the flying J truckstops how well speculating in the oil futures market worked out for them. although many still fly under the flying J banner all are owned now by either the pilot or love,s truckstop chain....dwain
     
  20. capulona

    capulona TS Member

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    Why are

    Bulls make money, Bears make money, Pigs get slaughtered.

    You can make money in a market that's going up(Bulls), everyone and their brother then takes a ride(Pigs), then you go short and make even more(Bears). That's the beauty of the market - if you only know how to make money on the upswing, you should NOT be playing.
     
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