Posted on 05/08/2008 9:35:15 PM PDT by kellynla
NEW YORK (CNNMoney.com) -- With $120 oil not seeming to follow the fundamental law of supply and demand many are wondering if the market is broken.
The Federal Reserve has been cutting interest rates, saving Wall Street but sinking the dollar and driving up food and fuel prices. Investors, also called "speculators" by some, have been pouring money into commodities of all sorts, artificially driving prices higher in an attempt to squeak out healthy profits in the face of falling stock values.
But to many, all the financial voodoo is merely a distraction. The fundamental reality of oil - and the thing that makes it so attractive to investors in the first place - is that we are using ever more and finding ever less. High prices are necessary if we are to reduce demand, find new oil, and develop alternative technologies.
"The market is starting to send a signal: You got to get your alternative in line," said Robert Kaufmann, director of Boston University's Center for Energy and Environmental Studies. "Societies that ignore this kind of signal do so at their own peril."
Kaufmann isn't promoting the so-called "peak oil" theory - he doesn't think the world is quickly running out of oil.
(Excerpt) Read more at money.cnn.com ...
It is a nice thought but the EPA restrictions & permitting process still apply.
If they want to wave restrictions and permitting, that can be done for any piece of property.
I'll take that as a mere rhetorical flourish, rather than as a serious piece of advice.
I don't really believe oil is overvalued just now, given the dicey circumstances that exist throughout the world--in the Middle East, Venezuela, and Nigeria, especially. True, what goes up must eventually come down--it is an axiom that is just as applicable to stocks as to anything else--but I believe we will eventually think of $120-per-barrel oil as the good old days.
By the way, it is a small point; but your reference to my "401K" misses the mark. As I indicated in my earlier post, I no longer have such a financial instrument; it was rolled over into an IRA (the traditional variety) about 16 months ago.
;0)
Judging from the context back a couple paragraphs, I believe he is talking about natural gas.
And no, he has no clue what he is talking about using such a time frame or such a drastic change without discussing the hundreds (thousands?) of billions of dollars required to make such a change in infrastructure.
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