Wall Street: the real reason for higher gas prices

W

wQuay

Veteran XX
Clifs: Institutional investors were looking for new places to put their money following the dot com bust, and started investing in commodities. By one measure, these types of investments went from $13 billion in 2003 to $260 billion in 2008.

In the same period, the total number of open crude oil futures and options contracts rose by 364 percent, while global demand for petroleum rose by 8.2 percent.

Not the whole story, but a big part of it.

Michael Masters Testimony Before US Senate

Oil Price Bubble?
 
I had 40-50 racehorses at a time.

Do you know what they cost a month to feed?

$50,000 a month just to feed 'em.
 
[Golbez-RG-] said:
What wall street (Morons) totally failed to realize: Peak oil - Wikipedia, the free encyclopedia
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Did you just hear about this or something? I think everyone has been hearing about this for years and years, especially on the commodities exchange.

Yes, right now we are sitting on a big commodity bubble in my opinion. I would limit my exposure. There are some raw materials especially that don't deserve their inflated valuation (I don't count fuels among the hyperinflated)
 
osse697 said:
This is debated, but from my readings the informed consensus is that this is not a bubble.
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I must be reading different things than you, I have heard about equal support for either side. The fact of the matter is that the price of many commodities has risen at a rate far exceeding the actual increase in demand. That suggests to me that speculation is driving the prices higher and higher and that is certainly supported by the influx of capital into the commodities market. As soon as it becomes clear that the increased demand does not live up to the hype, a correction will come. I think we will see a short-term correction in oil, and then it will resume climbing in price at an reduced rate. The bigger bubbles exist in latecomers to commodities party jumping on board things like potash and some of the manufacturing metals. Even things like cocoa and cotton are inflated right now due to investors looking for easy to value instruments.

When the dollar strengthens, all commodities based on the dollar will take a big blow. Gold is sitting on a particularly large bubble in my opinion. Commodities are traditionally very volatile, and I think many investors are in for a shock if they overweight.
 
The price of copper is way up too. People are breaking in to construction yards to steal pipe, even hacksawing it out of houses that are being built just to sell it to scrap dealers.
 
actually copper gutter are removed for safety reasons. They tend to explode when in contact with leaves.
 
trop said:
actually copper gutter are removed for safety reasons. They tend to explode when in contact with leaves.
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Yeah, just last week 4 gutters blew up in my neighborhood killing 2 kids, 1 dog and 12 sparrows. The carnage was horrific. :(
 
Peak oil is bull shit. The only reason why it looks like it has "peaked" because there are not enough refineries to refine the shit fast enough.

Fuck we are sitting on about 200 years of oil but we cant touch the shit or the Arabs wont be obligated to buy our debt anymore.
 
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