60 Minutes: Oil Prices Manipulated

You didn't understand that? So simple.

Commodities are traded for about 10 minutes on the first Monday in January. A couple of people in the pit set the tone for the whole market.

The extra money the rest of the world pays is not "price of oil" . . . it's taxes.

They pay $5-6 per gallon . . . they get free education and health care.

American college graduate is paying $2.50 per gallon . . . and has $30,000 in student loan debt and a $500 health insurance premium every month.

 

Hey, I saw Wall Street on SPIKE the other night. I think I'm finally starting to understand the end of that after the 10th viewing.

The European taxes thing makes sense -- and sounds like a good deal to me!

 

Yeah, about that wind farm:

http://news.yahoo.com/s/ap/20090707/ap_on_bi_ge/us_pickens_wind_energy

I suppose he could send them to Hardin County in Ohio, where there are plans to create a $100m wind turbine farm, which will create enough energy for all of 12,000 homes!

http://www.wind-watch.org/news/2009/07/03/company-plans-100m-wind-farm-in-hardin-co/

 

The only problem with your analysis is the belief that it had a rational relationship to changes in our driving habits and oil consumption. That ain't what happened, during the spike prices continued to soar even during periods when we had massive supply gluts without a corresponding increase in worldwide consumption. According to the rules of supply and demand, prices should've gone down during those periods, instead they just kept soaring. Oil went from a bit over 60 bucks a barrel to nearly 150 in less than a year and then crashed all the way back down in only about 3 months, do you really believe the world's driving habits changed that radically during that year?

The whole thing was just another artificially inflated price bubble. After the real estate bubble collapsed, the speculative money went looking for the next wave to ride and found it in oil. As Boom said, the economic collapse helped end it by drying up the ability of speculative investors to keep feeding the monster, but changes in our driving habits/oil consumption had very little to do with it.

 

It's not a cartel. It's not some jerk driving up the prices, because a good speculator can make money when the price rises and when the price falls. Free market economics, imagine that. Further interference in the market will lead to LESS supply and ultimately, higher prices. Remember wage and price controls from the 70's? That was a Republican who did that and it was a DISASTER.

It's so simple, even a liberal can understand. Or not.

As for this paying a bunch of money in added-on taxes for gas, I'd much prefer to pay for my own education (even if it took loans to do it) and my health care, thank you very much and save the money. So much of my treasure gained by my hard work is wasted by central governments (look at these 1,200-page bills. You can't tell me there isn't a bunch of goodies for contributors and other pork larded into those things) that it isn't even funny. It is far more useful sitting in my back pocket, where I, the individual, know best on how to allocate those scarce resources. Not a bunch of botox-injected, Marxist, sputtering windbags who couldn't run a lemonade stand, much less a government.

 

Fed sues Oil traders for Market manipulation:

http://www.nytimes.com/2011/05/25/business/global/25oil.html?scp=2&sq=oil&st=cse

"The commodities agency says the case involves a complex scheme that relied on the close relationship between physical oil prices and the prices of financial futures, which move in parallel."

"At one point they had such a dominant position that they owned about 4.6 million barrels of crude oil, estimating that this represented two-thirds of the seven million barrels of excess oil then available at Cushing, according to lawsuits."