Posted on 06/25/2008 8:52:27 AM PDT by Always Right
So how would we buy the gas directly?
I’m all for capitalism. There is more to preserving capitalism however than allowing those who trade in futures to get away with an additional layer of demand to the cost of oil, at the consumer’s expense.
Because our economy depends so much on transportation, gas prices staying this high can not only drive other industries out of business but we are all going to be paying for it in many ways. All so that a few can continue to get rich investing in oil futures? Sorry, but even as much of an advocate of capitalism as I am, we are at a point that goes way beyond the fundamentals of capitalism and the free market. I’m all for competition and letting REAL supply and demand market forces work. What wall street is doing is something different and it’s harming a lot of industries and people.
Just raise the margin requirement to 25% and oil will be bqck to $30 real quick!
Throw out the preengineering studies, the math studies, the critical thinking classes ... that way the gubmint can dumb you down and control your life.
Speculators do NOT drive up prices and do not ADD a layer of demand what ever that means to begin with.
We get what we deserve.... a nation of non educated non critical thinking people
“So how would we buy the gas directly?”
The oil producers sell oil by the barrel to the refining and distributing companies such as Exon, Shell, etc. This price would be based on supply and demand. This is how it pretty much happened as far as I am aware, until 2006. The oil producers and oil distributors then started using the index on the NYSE to legitimize the prices they were charging.
Isn’t it easy to speculate that the prices will go up when the commodities trader himself is the one driving those prices up?
Those traders that can afford to buy enough oil, can buy it for 3 months from now at say $150 a barrel. If that same barrel of oil would have been sold at $100 a barrel to the distributor based on true worldwide supplies and demand, then the cost at the pump is 50% higher for the consumer. 50% of the cost of a gallon of gas in this example,goes to make the commodities investor rich, not to pay for the actual price of oil. Why? How is capitalism threatened by putting an end to this? We had capitalism in the U.S. prior to 2006. We weren’t a communist nation prior to 2006.
You are so wrong on so many levels that it would take me an hour just to touch on every level you are wrong on.
1)There is a big difference between taking a risk buying in futures and actually being able to drive those prices up. The investors I am talking about aren’t going to lose a significant amount of money and their overall gains will be much larger than any losses because this isn’t based solely on real supply and demand of oil as a consumer product. It is based on their OWN demand for the oil as a COMMODITY to INVEST in. They are creating this artificial demand that is ADDITIONAL to normal supply and demand market forces. I don’t know how much more clearly I can state this.
2) One does not have to be against investors to see that what the commodity investors are doing with trading in futures is hurting the overall economy and national security. I am all for investing so that companies have the capital to grow and profit and investors get a return also.
3) I am not for all unions. All I have ever believed is that there have been times in our nation’s history when some industries have needed the power of collective bargaining. That while many unions have become abusive, many business have been abusive also and when either business or labor gets out of control, the overall economy suffers.
4) I do not believe the govt should step in to all aspects of business. I believe in a certain level of regulation and that for the most part, businesses should have to sink or swim and compete on their own.
5) I do not think oil companies are evil. I fully expect every business to do what is in their self interest. I expect the same of individuals. That is not to say that they should get away with whatever they can at the cost of forcing entire industries such as the auto, airline, travel, trucking, farming, and tourism industry out of business or make them go bankrupt for no fault of their own but rather because another industry has raised the price of their products so far above real supply and demand market forces.
6) I am generally not for the govt bailing out anybody or any entity although there are some exceptions. As far as flood insurance, most inhabitable places in the U.S are at some risk of flooding which is why private flood insurance is too expensive for most people to afford. This is why I believe that a national flood insurance should be mandatory rather than optional and this will keep the prices so much more affordable than private insurance which has so much profit built into it.
7) I am a conservative on every social issue I can think of. You don’t do your cause any favor by implying that anyone who disagrees with you on some aspects of some economic issues is not a conservative. All it does is fracture our party and movement that much more and maybe that is what it is going to take to bring us together on the larger issues. If an Obama Presidency doesn’t do it, then we as Republicans will never be a homogenous enough of a group to ever get our party back in power if Obama does win.
“Obviously you never took a basic economics course ... seems the entire gubmint screwel education system skips over it in exchange for prime courses such as basic basket weaving, women’s studies and I’m Ok your Ok.
Throw out the preengineering studies, the math studies, the critical thinking classes ... that way the gubmint can dumb you down and control your life.
Speculators do NOT drive up prices and do not ADD a layer of demand what ever that means to begin with.
We get what we deserve.... a nation of non educated non critical thinking people”
Wow.....great job in supporting your position. I explained in detail and repeatedly how the trading of futures in oil as a commodity has added an artificial demand for oil as a commodity to invest in and have given several examples explaining how this works. In your rebuttal, you tell me I’ve never taken an economics course, implied that the educational system didn’t teach me to use critical thinking skills, that speculators haven’t driven up the price of oil (without supporting this position at all as if simply stating it is enough), and said that we as a nation get what we deserve.
LOL.........”non critical thinking people”........you’re telling me I’m not educated while not backing up your argument and using grammar such as “non critical thinking”.......that’s funny!
Thwe crux of it all, is that speculators, cannot bid up prices to inflated profits, UNLESS there is a tight suppy. The ONLY way to solve the short term pain of the oil market, is to INCREASE SUPPLY. The long term is to wean ourselves off of the dependancy from sources that restrict suppply, and to use alternative fuels. There is no way to switch quickly to alternative fuels to an extent that it would impact our demand, withouit bringing about an economic crash, that would be as bad or worse than the Great Depression...which of course, the DemoSocialists would love.
DemoCrooks *Robbing* the Oil compnaies of their profits, will not increase our supply of fuel, by one drop. But it would likely chase them out of the US, and that would increase the devastating effects on our economy, and our future as a nation.
It doesn’t matter. The price of gas will jump up-considerably-just before the fourth of July. I just don’t know what the excuse will be.
There really IS no ‘free market’ where energy is concerned. If I see a price on, say, a shirt, and I consider it too high, I can go somewhere else and get the shirt at a competitive, lower price. I cannot do that with gasoline or natural gas to heat my home, or electricity to run things. Because there virtually is no competion to speak of, I must pay what they ask, and they will get it. And you can only cut back so far, but there is a bare minimum everyone has to use, and they can’t go below that. Every gas station in this area is the exact same price. I asked my gas station attendant how they decide the price-she told me the same thing others have at orger brand stations-the manager looks at other stations and sees what they’re charging on his way to work. Then he sets his accordingly.
“Thwe crux of it all, is that speculators, cannot bid up prices to inflated profits, UNLESS there is a tight suppy. The ONLY way to solve the short term pain of the oil market, is to INCREASE SUPPLY. “
I’m not arguing that real supply does not exist and I’m not arguing that real demand does not exist. These are both in play and cause fluctuations in the price of oil. I’m arguing that based on my limited understanding of how the stock market works, that investors are buying oil based on its future value. Oil producers and oil distributors are then using the NYSE index to legitimize the prices they set. That the investors are not buying and selling oil as a consumer product subject to real worldwide supply and demand only, but also as a commodity to invest in.
It is basically has a chain reaction. The investors buy the oil for a future price that is higher than present. This is reflected in the index on the NYSE. The oil producers and distributors use this index to decide what to charge for their product. The producers to the distributors and the distributors to the consumers.
What leads me to believe that this drives fluctuations in oil prices to a degree that dwarfs real supply and demand, is the rate at which the prices have increased over a short amount of time. They’ve doubled over two years from above $2 to above $4 a gallon and there is no way that worldwide demand compared to supply has doubled in two years.
Now, I have stated and will state again that I am far from an expert on this issue. I am barely learning about it. All I can do is take in new information and try to use logic to draw conclusions. If someone can make an argument that causes me to think I have been misinformed or have drawn false conclusions, I am completely open to that. It just hasn’t happened yet.
Why does this not surprise me ... you cannot argue the content in question .. you go to some meaninginless statement.
It is the liberal way. Forget the arena of ideas. Lets learn how to spell potato(e) ... or define the word “is” ..
don’t waste my time.
I rest my case, you just proved your lack of abilities.
LOL...........you are the one that has not explained why you disagree with me. I am the one that has explained how I came to my conclusion. You are the one that implied that the education system has failed in teaching me how to use critical thinking skills and all while not being able to form a coherent idea or use the English language properly. Sorry, I just find that funny and worthy of pointing out.
It’s one thing for someone to make a typo while typing or misspell a word, or even use bad grammar. It’s rises to a completely level for someone to
1) Tell another that they are wrong without offering an argument as to why.
2) Don’t bother to engage the points the other person made.
3) Imply that their level of education is inferior to yours and do so while using bad grammar.
Did you expect to not get called on it? My 7th grader both writes better than you and uses logic to back up his conclusions better than I’ve seen of you, so I’d spend more time on your skills if I were you. If you want to be someone who is “critical thinking” that is...........LOL.
“It is the liberal way.”
Yeah, I’m a real liberal alright.....LOL. Funny thing is that the liberals think I’m a right-wing extremist.
That’s the ticket right there. Just call anybody who you disagrees with on anything a liberal. You forgot communist. I mean, anybody who thinks the oil commodities market is being manipulated based on the price of oil doublingover two years even though worldwide demand compared to supply has not doubled over two years must be a communist......and a liberal too.........LOL.
We have too.
We're now fighting their greed with being super cheap, and combining all trips, and taking zero unnecessary trips, tires inflated to max, and save money by no longer eating out, replacing all of our bulbs with energy savers, growing our own food, and numerous other cut backs and cheap schemes.
I've made a new hobby out of being cheap, and frugal. They greedier they get, the cheaper I get.
I love it!
I’m all for capitalism. There is more to preserving capitalism however than allowing those who trade in futures to get away with an additional layer of demand to the cost of oil, at the consumer’s expense.
Hey .. it was your initial point that is indefensible. Please explain to me what economic system makes your statement valid. Want to tell me how speculators “add another layer of demand” Actually I want to know what a layer of demand is ... explain please with your almighty intellect. And while you are at it, continue on and tell me how eliminating speculators will make the best economic system in the world, better.
Amazing ... why can we as American’s put a Rover vehicle on Mars. How many other nations have that technology. Is it our wonderful resources or creative people. No it is freedom .... freedom to excel .... feedom to create and build dreams into reality. Freedom to find speculators (uh oh that nasty word again)that will fund exporation. It is our system that allows us to be the greatest nation to ever exist .... and it is built on an economic system of speculators.
I’ll wait for your fluent words on how speculators increase a layer of demand rather than providing the asset they do to our economic system. You have yet to answer that yet ... you have skirted that like the plague.
I can’t wait
I’m still wiating ... jut not expecting. A tiger is a tiger. A liberal is a liberal. It is what it is ...you’ve made my case
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