California Autos Examiner

Tuesday, July 01, 2008

Speculation That Speculators Aren't Responsible for Nuthin'

Don't blame speculators for rising oil prices - The New Yorker-

"Speculators, by contrast, mostly use futures contracts to gamble on oil prices, and have no interest in buying or selling real barrels of oil. These gambles can be tremendously lucrative, but they don’t directly determine the real (or “spot”) price of oil. That’s set by the people who are buying and selling actual barrels of petroleum. Although speculators could directly distort oil prices by turning their futures contracts into oil and then taking it off the market to drive up prices, a look at oil inventories shows no sign that this is happening."

I'm not market savvy enough to know if this editorial makes a valid point. Personally, I hold Matthew Lesko responsible for all of this mess. Why? Ask his question mark suit.

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