Am I getting this Oil thing right?

[renterclint]

“The oil price can be thought of as a composite signal, resulting from a speculative signal superimposed over a fundamental signal. If we can determine the magnitude and sign of the speculative signal at each time, we can ascertain whether speculation was the main driver of the latest price rise or not.”

arraya, I have never claimed to be a mental giant, but this passage you just posted makes my head hurt! I think I got my signals transposed rather than superimposed…

Does the COT address the swaps & other derivatives that are directly related to the commodities futures? It sounds like there is a lot of activity going on with virtually no oversight.

And btw, I think you are right on the $$ about demand forever outstripping supply. As China, India, & other companies continue to develop & the foreign middle-class grows, demand will be out of control. Oil reserves are finite. It is definitely time to plan for our long-term energy future.

But I disagree that the current state of commodity speculation is irrelevant minutia. It is a current problem that if addressed directly could provide economic relief regarding energy prices & likely food prices as well.

[Shadowfax]

Curious if anyone follows this site and what the pigg community thinks of it:

http://www.lifeaftertheoilcrash.net/

[Shadowfax]

Curious if anyone follows this site and what the pigg community thinks of it:

http://www.lifeaftertheoilcrash.net/

[Shadowfax]

Curious if anyone follows this site and what the pigg community thinks of it:

http://www.lifeaftertheoilcrash.net/

[Shadowfax]

Curious if anyone follows this site and what the pigg community thinks of it:

http://www.lifeaftertheoilcrash.net/

[Shadowfax]

Curious if anyone follows this site and what the pigg community thinks of it:

http://www.lifeaftertheoilcrash.net/

[greekfire]

Maybe I don’t know enough about the subject, but why don’t we just let the market sort things out? The best way to promote a more diversified usage of energy is to have an increase in oil prices. Look at how many more Prius’ there are on the road, and how many more people are carpooling, taking mass transit, or riding their bikes instead of driving. I am sure that countless young (and old) entrepreneurs and inventors have been created as a result of the recent runup in energy prices. This is the free market at work. The government and taxes only serve to complicate things IMHO.

[greekfire]

Maybe I don’t know enough about the subject, but why don’t we just let the market sort things out? The best way to promote a more diversified usage of energy is to have an increase in oil prices. Look at how many more Prius’ there are on the road, and how many more people are carpooling, taking mass transit, or riding their bikes instead of driving. I am sure that countless young (and old) entrepreneurs and inventors have been created as a result of the recent runup in energy prices. This is the free market at work. The government and taxes only serve to complicate things IMHO.

[greekfire]

Maybe I don’t know enough about the subject, but why don’t we just let the market sort things out? The best way to promote a more diversified usage of energy is to have an increase in oil prices. Look at how many more Prius’ there are on the road, and how many more people are carpooling, taking mass transit, or riding their bikes instead of driving. I am sure that countless young (and old) entrepreneurs and inventors have been created as a result of the recent runup in energy prices. This is the free market at work. The government and taxes only serve to complicate things IMHO.

[greekfire]

Maybe I don’t know enough about the subject, but why don’t we just let the market sort things out? The best way to promote a more diversified usage of energy is to have an increase in oil prices. Look at how many more Prius’ there are on the road, and how many more people are carpooling, taking mass transit, or riding their bikes instead of driving. I am sure that countless young (and old) entrepreneurs and inventors have been created as a result of the recent runup in energy prices. This is the free market at work. The government and taxes only serve to complicate things IMHO.

[greekfire]

Maybe I don’t know enough about the subject, but why don’t we just let the market sort things out? The best way to promote a more diversified usage of energy is to have an increase in oil prices. Look at how many more Prius’ there are on the road, and how many more people are carpooling, taking mass transit, or riding their bikes instead of driving. I am sure that countless young (and old) entrepreneurs and inventors have been created as a result of the recent runup in energy prices. This is the free market at work. The government and taxes only serve to complicate things IMHO.

[EconProf]

Greekfire described the free market approach pretty well–and how it solves problems if we just let it alone to work.
The price system is also a signaling system. Higher prices encourages consumers to conserve at the same time it encourages suppliers to reallocate resources to produce more, plus come up with substitutes. Government interference thwarts the natural and healthy tendencies of both suppliers and demanders to eventually solve the problem.
Much of the current high world oil price can be attributed to government price controls in developing countries. China, India, Indonesia and many others have government-set prices that discourage conservation by consumers. I understand that Venezuela and Iraq have gasoline well under $1 per gallon. Of course their long lines of cars are pictured on our TV news coverage, but the dolt reporter never states what the government fixed the price of gas at. Also, how many Americans reading the news about electricity shortages and blackouts in Baghdad know that their electricity is not even metered? Sales of air conditioners there are high, but why should anyone take any electricity-conserving measures if it is free when it is on.

[EconProf]

Greekfire described the free market approach pretty well–and how it solves problems if we just let it alone to work.
The price system is also a signaling system. Higher prices encourages consumers to conserve at the same time it encourages suppliers to reallocate resources to produce more, plus come up with substitutes. Government interference thwarts the natural and healthy tendencies of both suppliers and demanders to eventually solve the problem.
Much of the current high world oil price can be attributed to government price controls in developing countries. China, India, Indonesia and many others have government-set prices that discourage conservation by consumers. I understand that Venezuela and Iraq have gasoline well under $1 per gallon. Of course their long lines of cars are pictured on our TV news coverage, but the dolt reporter never states what the government fixed the price of gas at. Also, how many Americans reading the news about electricity shortages and blackouts in Baghdad know that their electricity is not even metered? Sales of air conditioners there are high, but why should anyone take any electricity-conserving measures if it is free when it is on.

[EconProf]

Greekfire described the free market approach pretty well–and how it solves problems if we just let it alone to work.
The price system is also a signaling system. Higher prices encourages consumers to conserve at the same time it encourages suppliers to reallocate resources to produce more, plus come up with substitutes. Government interference thwarts the natural and healthy tendencies of both suppliers and demanders to eventually solve the problem.
Much of the current high world oil price can be attributed to government price controls in developing countries. China, India, Indonesia and many others have government-set prices that discourage conservation by consumers. I understand that Venezuela and Iraq have gasoline well under $1 per gallon. Of course their long lines of cars are pictured on our TV news coverage, but the dolt reporter never states what the government fixed the price of gas at. Also, how many Americans reading the news about electricity shortages and blackouts in Baghdad know that their electricity is not even metered? Sales of air conditioners there are high, but why should anyone take any electricity-conserving measures if it is free when it is on.

[EconProf]

Greekfire described the free market approach pretty well–and how it solves problems if we just let it alone to work.
The price system is also a signaling system. Higher prices encourages consumers to conserve at the same time it encourages suppliers to reallocate resources to produce more, plus come up with substitutes. Government interference thwarts the natural and healthy tendencies of both suppliers and demanders to eventually solve the problem.
Much of the current high world oil price can be attributed to government price controls in developing countries. China, India, Indonesia and many others have government-set prices that discourage conservation by consumers. I understand that Venezuela and Iraq have gasoline well under $1 per gallon. Of course their long lines of cars are pictured on our TV news coverage, but the dolt reporter never states what the government fixed the price of gas at. Also, how many Americans reading the news about electricity shortages and blackouts in Baghdad know that their electricity is not even metered? Sales of air conditioners there are high, but why should anyone take any electricity-conserving measures if it is free when it is on.

[Author]

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