[Beagle8U]

The thing the article fails to mention is buying massive amounts with little to nothing in cash to cover the futures purchase.

That drives up prices on the futures, which are then sold at inflated prices.

That is what is happening today. Even Eric Bollings, who worked in that business, said that.

Require real assets to cover the trades and that problem instantly goes away.

[thackney]

The thing the article fails to mention is buying massive amounts with little to nothing in cash to cover the futures purchase.

That drives up prices on the futures, which are then sold at inflated prices.

Apply your logic to the Natural Gas Futures traded on the same rules.

Not to mention far more oil is traded in markets outside the US than on the NYMEX.

[Don Corleone]

The thing the article fails to mention is buying massive amounts with little to nothing in cash to cover the futures purchase. That drives up prices on the futures, which are then sold at inflated prices. That is what is happening today. Even Eric Bollings, who worked in that business, said that. Require real assets to cover the trades and that problem instantly goes away.

Your understanding of the futures market seems very thin. Futures trades actually smooth out the irregularities that would develop in any commodity due to seasonal, political, weather, transportation anomalies etc. When you take on a futures contract you own the product. You may make a profit or you could take a big big loss depending on the fluctuations. Since most commodity contracts are held for minutes, maybe a couple of hours, they are traded actively and the prices stay in a very close range. Go spend a day at the Chicago Board of Trade or the Merc or any of the active commodities exchanges and learn how the system works. You'll be glad you did.

Former trader