Gordon Brown triggers row with call for bank supertax

[HairyArsedBloke]

Atw, please leave this subject alone - you have no idea what you are talking about.

There may be some speculative content to oil prices of the form you describe, but data from the CFTC does not support the popular belief that speculation is dominant. The current price of oil has more to do with the current, and indeed long term, devaluation of the dollar as has all asset prices.

[AtW]

The current price of oil has more to do with the current, and indeed long term, devaluation of the dollar as has all asset prices.

Oh, so dollar devalued nearly 3 times (based on oil price $30 going up to nearly $90 now) since start of the year? Why prices of other commoddies did not increase as much in the same period?

It is fact that lots of supertankers were rented to hold oil bought at start of the year in order to artificially increase demand and then sell it later when price goes up.

[HairyArsedBloke]

It is fact that lots of supertankers were rented to hold oil bought at start of the year in order to artificially increase demand and then sell it later when price goes up.

Urban myth.

Yes there was some storage when prices were very low and there was a large surplas in production. Can you tell me just how much has / is store that way. While you're at it can you give a comparison to the daily consumption. What is the cost of carry for this trade too?

[AtW]

Yes there was some storage when prices were very low and there was a large surplas in production. Can you tell me just how much has / is store that way. While you're at it can you give a comparison to the daily consumption. What is the cost of carry for this trade too?

Can first please explain me how is it dollar (according to you) got "devalued" nearly 3 times (300%) on the basis of price of oil going up from $30 to nearly $90? Once you do that we can talk about "urban myths" that were widely reported many months ago.

[HairyArsedBloke]

Oil
Dollar Index

While I'm at it
S&P 500
US Treasury 10 Year Note Price
US Treasury 10 Year Note Yield
US Treasury 30 Year Bond Price
US Treasury 30 Year Bond Yield

Someone is bound to ask about
Gold

During the panic of the first part of the year EVERYONE was piling out of all asset classes and into US Government Bonds. Even overseas investors which is shown in the strength of the dollar index. Once that had subsided, the long decline in the dollar resumed.

All assist classes, except bonds, showed a bottom around March and have recovered somewhat. However, much of that recovery is down to wanting to hold 'anything' except cold hard dollar cash as the value of the dollar evaporates.

At around 80 bucks, oil is roughly at a long term average.

The rise in the US stock markets does have something 'odd' going on. There is a lot of chatter that someone, lets use the initials GS (any similarity with anyone else with the initials GS is purely coincidental), is distorting the market. Volume on up days is a lot lighter than down.

[AtW]

Are you deaf?

Look at your charts - oil gone up from $30 to $80 (nearly 300%), gold on the other hand went up from low of $740 to $1080 now, which is 45%, if your theory about oil being driven primarily by devaluation of dollar was correct then gold (if anything) would have shot up much higher - it would have been trading now at $1973.

[AtW]

At around 80 bucks, oil is roughly at a long term average.

http://www.whatmattersweblog.com/wp-...may-162009.jpg

Yes, $80 is average - no wonder western economies are going down the drain if people like you are in charge (which you ain't but I reckon this actually means you are probably smarter than average, using long term index of human stupidity here).

[HairyArsedBloke]

http://www.whatmattersweblog.com/wp-...may-162009.jpg

Yes, $80 is average - no wonder western economies are going down the drain if people like you are in charge (which you ain't but I reckon this actually means you are probably smarter than average, using long term index of human stupidity here).

Deflate,inflate if you like, by cpi and dollar index and look again.

[AtW]

Deflate,inflate if you like, by cpi and dollar index and look again.

Why oil gone up by nearly 300% from start of year where as gold (supposed hedge against inflation of dollar) only gone up by 45%?

Why would someone who wants to cover oneself from inflation buy huge amounts of oil that will need to be stored etc, where as they could buy small amount of valuable gold instead?

Weakness of dollar is not the main explanation for shenanigans that's going on in the oil market.

[scooterscot]

Chris Kendall wrote:
The Americans have got Brown's number, they know he's on the way out and are ignoring him. A bit like Bush towards the end of his second term. Quack!!
November 8, 2009 11:35 AM GMT Recommended (5)