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Ira's post in thinly veiled nonsense. Yes, the Saudi's still have
almost 2 million bbl/day reserve output available. However, the
Saudis CORRECTLY point out that an increase in production by them would
not have any material effect on the markets. The markets themself
are setting the price largely due to speculation in futures trading (the
sort of thing this list is really supposed to be about but that Ira's
article totally ignored to comment upon). A look at the price
fluctuations compared to net changes in inventories shows they are
decoupled and therefore therefore we can conclude price is not currently
linked to supply/demand. In fact the net inventory changes in crude
oil (both in the US and globally) show that prices are rising while
inventories are rising. Rising inventories indicate a declining
demand (or at least demand in excess of supply). Either way one
wishes to interpret it the conclusion is that price is decoupled from
supply and demand and an increase in supply would merely increase
inventories without moderating prices.
Likewise, Ira's rant goes on about inflation and interest rates and money
supply expansion without discussing productivity. While I won't attempt
to argue that productivity gains completely offset some of the money
growth supply factors, the fact Ira completely ignores that part of the
equation again exposes his tirade for what it is (as opposed to any kind
of sound financial analysis). I have been a member of this list
long enough to know that Ira is not a fool nor unaware of these
counterbalancing economic factors. Therefore I can only conclude
his article was authored deliberately in a way to justify a viewpoint
rather than to provide a financial analysis of any kind. That's
just my opinion but if you go back and reread his tripe in detail I think
you will find it funny instead of freightening.
Boater805
At 11:55 AM 5/17/2008, you wrote:
First of all, I seriously doubt
if the Saudi's can raise output. I
strongly suspect they are at full production now.
As to filling up the reserves, Bush is hell bent to keep the reserves
up rather than use them for a short term solution to high prices. (A
solution which would do little to help the price problem
anyway).
Ira's post offers some sobering thoughts but what would happen if oil
came down? What if it came down to $80? And if we stopped promoting
the insane idea of bio fuels driving up food prices? If grain came
down 50% and meat 30%? Then what would the consumer situation look
like? Science fiction? I don't think so. I think the whole ethanol
craze is being seen for just what it is, crazy. A fuel that costs
more to make, pollutes worse than fossil fuels, and drives food
through the roof is certainly not the answer. Atomic energy and
hydrogen fuel cells are where I'm putting my energy dollars from this
point forward. Solar and wind will be minor players, especially for
home use but they do little or nothing for transportation and large,
commercial purposes.
So, a lot of the problems can be solved by simply forgetting about
ethanol and I feel there is a large amount of speculation in oil
now. We moved from 100 to 125 in days but demand most certainly
didn't increase by 25% in days. Who knows, maybe things will work
out after all.
Bob
At 01:46 PM 5/17/2008, you wrote:
>And strangly Mr.Bush justifies Saudi for not raising oil
outputs,not
>only that he was not in a favour of stopping filling oil reserve
>near Gulf of Mexico...very strange attitude and this has been
>discussed among all leading newpapers round the world.
>--- In
realtraders@xxxxxxxxxxxxxxx, "Ira" <mr.ira@xxx>
wrote:
> >
> > It is time to take a good look at where we are at this time.
In
>the first quarter of this year more than 158,000 families lost
their
>homes to foreclosure. The American public is going deeper in
debt
>every day. In a society where 70% of the economy is driven by
>consumer spending, inflation and debt are economy killers.
Millions
>of people have homes that are worth less than the mortgage amount
on
>their home. When they look at the economics of the situation
will
>they pay the inflated mortgage payments or walk away from the
>house? Family homes were the main source of their wealth and now
>with that gone they have no place to go for that extra money
they
>need to pay the ever-increasing cost of living. Duke Power said
>that they are cutting off utilities to 50 people a day because
of
>unpaid utility bills. Whether the government wants to admit it
or
>not we are in a recession. We are also in an inflationary spiral
>that won't quit. The government is pumping liquidity into the
>system at an alarming rate to save the financial institutions
that
>created a large portion of the problem.
> >
> >
> >
> > The balance of the article is on the web site if you are
>interested.
> >
> >
> >
> > Just one man's opinion.
> >
> > Ira
> >
www.delta100.com
> >
> > No virus found in this outgoing message
> > Checked by PC Tools AntiVirus (4.0.0.26 - 10.072.012).
> >
http://www.pctools.com/free-antivirus/
> >
>
>
>
>------------------------------------
>
>Yahoo! Groups Links
>
>
>
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