[roostercogburn]

Found this lurking around tonight. Like some input from our resident economists.

[dragnet2]

Nothing would surprise me at this point. Not saying all this is factual, just sayin nothing surprises me anymore.

[xjcsa]

They’ll find the same thing they always find with these silly “investigations” - nothing. It’s far too big a global market for one group of people to move in any significant way. Oil is expensive because the current price is where supply and demand meet - to change it requires either a higher supply or a lower demand.

[tobyhill]

If it’s a hoax then it’s the biggest in the history of the US and there wouldn’t be enough jail space for all those involved.

[Intolerant in NJ]

The big runup in oil prices reminds me of the payoff in the movie “Trading Places”, in which Eddie Murphy and Dan Ackroyd destroy “The Duke Brothers” by planting a phoney, supposedly secret report saying the orange crop is not going to be very good and waiting until the Dukes have bought up lots of contracts for delivery of oranges, then when the real report saying the crop will be good is released, buying up all the now almost worthless contracts which the Dukes will still have to deliver on - I’ve watched the movie about a dozen times and still don’t quite follow how it works, and I’m not sure how close it would be to the oil situation, and it is only a movie - nevertheless, it somehow resonates with what’s going on now.......

[FredZarguna]

The great oil crunch is another fabricated crisis; another “smoke and mirrors” fiasco; another Enron-type shell-game engineered by banksters and hedge fund managers.

And where is Enron today?

If, as the author claims the run-up in prices is due to speculation and no real problem with supply on the margin, those folks will be losing lots of money very quickly as US demand is down around 4.5%, exactly as happened with the housing-bubble and the internet-bubble, and exactly why we should not be bailing out anyone -- on either side -- of a bad mortgage.

Comparisons to overpriced tulips notwithstanding, artificial spikes in commodities cannot be sustained: there is simply not that much price elasticity. If the author is correct, the price of oil will crash.

[meadsjn]

Nobody but you taxpayers can bail out our financial markets. First, you sniveling subjects will pay double for your petrol (which is the first half of your tax bill for the bailout), then you will pay the other half out of your retirement accounts that are being used to drive up the bubble (that's the other half of your tax bill for the bailout).

You don't think the retirement funds of ordinary folks are going to get out of this commodities mess with a profit, do you? Silly!

[econjack]

Articles like this bother me since they seem to rely on the "Weight-of-Statistics" method to convince the reader. Back when I was taking econometrics 40 years ago, there was a 99.9% correlation between the rainfall in Iceland and cotton crops in the South. The problem was that, despite examination of every possible explanation (e.g., Gulf Stream, wind flows, etc.) there was no theory to explain the correlation. This article strikes me as the same kind of hocus-pocus: Lots of numbers with no real way to connect the dots. It's guilt by inference and surely no theory to tie it all together.

Then, in a moment of epiphany, I saw the last line:

The only time anyone in the Bush administration finds their conscience is when they’re offered a multi-million dollar “tell all” book deal.

I should have known: It's Bush's fault.

[count-your-change]

Another chump. If as the author suggests per the WSJ that oil would be $30 a barrel instead of its present price had the dollar been as good as gold then its the fall of the dollar and not speculation that is driving prices.
Then it’s margins that bedevil the market indicating he has no idea of the function of margins.
Finally it’s “the parasitical investor class” that is at fault. Garbage!

[tcostell]

It implies that there is a bubble in oil but there isn’t. It’s a common (too damned common) misunderstanding of how markets work.