FINALY ABOUT DRILLING

[firstenrgy]

Re: FINALY ABOUT DRILLING

Great post stout1. I do disagree with one part. Drilling here... Yes I would love it to be a last resort but I give you one word CARTEL!. We are paying more than market price due to the cartel. We weaken their power if we increase our percentage of self reliance on fossil fuels. We did it in the 80's and oil dropped below $10 a barrel. We were 70% domestic production and 30% foreign, now it's 70% foreign 30% domestic. That's unacceptable.

[trip]

Re: FINALY ABOUT DRILLING

where are the oil lines?


u need to understand commodity markets

it's not a conspiracy, it takes money for markets to go up, when u leverage with futures contracts you control more of the oil, the statistical facts on oil futures contracts, are they have gone up 1,000 per cent in the last several years

i'll say it one more time, war, smart money buys commodities, leverages up, the longer the war, the better off u are

again, these are historical facts

[firstenrgy]

Re: FINALY ABOUT DRILLING

where are the oil lines?


u need to understand commodity markets

it's not a conspiracy, it takes money for markets to go up, when u leverage with futures contracts you control more of the oil, the statistical facts on oil futures contracts, are they have gone up 1,000 per cent in the last several years

i'll say it one more time, war, smart money buys commodities, leverages up, the longer the war, the better off u are

again, these are historical facts

True but it probably only accounts for half of the increase we have seen above $80 a barrel. Just like I wrote in another post, it will work the other way once prices start to fall and the speculators run for the exits. I did see on CNBC that oil futures activity went up 600% since 2003.

[trip]

Re: FINALY ABOUT DRILLING

it was in wall street journal last week

u need to realize these guys have been leveraging up since oil was 30 bucks before the war, they control the price, they will not get hurt because demand will not subside


here's an example of what happens

a grain operator does 50 million in sales a year in corn, he buys 40 million, sells 50 million, has 5 million in costs, and he makes 5 million

when corn is 4 bucks a bushell, he has enough money, to do his trading and hedge it

when corn goes to 8 bucks he can only buy half the volume of corn he use too, yet, his costs are still 5 million, he can't buy more volume becuase his biz is only worht 20 million bucks, he cannot get more leveralge, if corn goes up too ten bucks, he's going broke with his silo's

now, let's take a billion dollar hedge fund, 900 million is in bonds, 100 million in the futures market, he has no 5 million in costs because he owns no silos has no employee's, now when the futures price goes up he aslo makes money, 10 million, when it goes up too 8 bucks, he can get more leveralge from the bank cause he has 900 million in bonds, thus next year he buys as much, has less competition and he pockets, 40 million

the same thing is going on in oil, majority of hedgers in oil futures are now huge hedge funds with bucko bucks too leverage, os opposed too xyz oil company, or joe blow refinery, who has a limited amount of money, if he does not make money on his biz he cannot hedge

[trip]

Re: FINALY ABOUT DRILLING

thus, the folks who the market was made for, folks who use the commodity have been bullied out of the market, plus there raw costs are out of control and they are operating at losses

[firstenrgy]

Re: FINALY ABOUT DRILLING

Trip. I was trading options when the Chicago Board opened for the first time. I have a full unserstanding of commodities and the market in general. The misconception you seem to have is there is some secret source that is driving prices when it is supply and demand. I assure you there are no men twisting their handlebar mutaches having a party in their penthouse and laughing on how they fixed prices on oil this month. The oil market is to large to control. NO ONE has enough money to bid prices up permanantly.

[trip]

Re: FINALY ABOUT DRILLING

i don't believe it is a secret source

war, buy commodities, pretty simple in my book, if your well versed in commodities then u know that truth

agree no one has enough money to bid the prices up permanently

yet, if u buy at 30, have a war, have katrina, have global growth, u r not selling, u r slowly buying more futures contrcts cause you averaged up the whole way

the trend is your friend, you average up

and as far as fixing prices, that's as old as man itself, happens all the time

[trip]

Re: FINALY ABOUT DRILLING

well, i read a good article today on inflation statistics and oil, i'm rethinking my position, and i hate the thought of having too, cause this could get nasty nasty nasty