Commodities bubble?

[trustdnb]

Originally Posted by cire2222

Eric Bolling article, he is one of my favorite traders out there

Bolling: How to Solve the Oil Crisis - TheStreet.com

Ive been reading a lot of things like this lately. The article starts by pointing out that the average American uses 25 barrels of oil a year, while the average Chinese uses 2 and the average Indian uses 1. Unfortunately these articles always end up saying the same thing: lets drill for more oil so we can get back to driving around in our gas guzzling SUVs like God intended. How about a little conservation? The average Chinese rides a bike or moped. The average Indian rides a bike or walks. For all the lip service we have paid to reducing carbon emissions and preventing global warming over the last 10 years, you would think that the focus would be how we can reduce our oil usage rather than how we can get back to our old wasteful ways.

My recommendation is to get used to high oil prices, and to start finding ways to reduce consumption. The Europeans are years ahead of us in this regard - they ride more bikes, drive smaller cars and make more use of public transportation. Remember how carpooling was sort of a cute, eco-friendly idea? Well look for carpooling to make a long overdue comeback.

[MC]

Originally Posted by trustdnb

Ive been reading a lot of things like this lately. The article starts by pointing out that the average American uses 25 barrels of oil a year, while the average Chinese uses 2 and the average Indian uses 1. Unfortunately these articles always end up saying the same thing: lets drill for more oil so we can get back to driving around in our gas guzzling SUVs like God intended. How about a little conservation? The average Chinese rides a bike or moped. The average Indian rides a bike or walks. For all the lip service we have paid to reducing carbon emissions and preventing global warming over the last 10 years, you would think that the focus would be how we can reduce our oil usage rather than how we can get back to our old wasteful ways.

My recommendation is to get used to high oil prices, and to start finding ways to reduce consumption. The Europeans are years ahead of us in this regard - they ride more bikes, drive smaller cars and make more use of public transportation. Remember how carpooling was sort of a cute, eco-friendly idea? Well look for carpooling to make a long overdue comeback.

You gotta post this stuff in my rant thread man. That's exactly what I was saying. I'm sick of people abusing natural resources and then whining when the price goes up. Conserve some, you just may have kids someday that could use a lil oil.

And don't bitch about prices when it's brought on at least in part by your abuse of the product. I run my furnace at 69 in the winter, I know people that set their shit to 80. CMON, you wanna live in the Bahamas fuggin move there and save money + fossil fuels.

[cire2222]

maybe you guys didn't read thw whole article but he wants to attack the problem at both ends, drill more and consume less. He also touches on uranium which is wher ei think we should head

[trustdnb]

Originally Posted by cire2222

maybe you guys didn't read thw whole article but he wants to attack the problem at both ends, drill more and consume less. He also touches on uranium which is wher ei think we should head

Yeah, I guess I have just been seeing a lot of this sort of thing lately, so my comments can be taken as more of a general comment. Bolling does try to balance it out by mention the demand side briefly (basically: drive more hybrids) and also throws some alternatives into the equation. The uranium stuff sounds interesting, at least until I can get my flux capacitor working.

[MC]

Originally Posted by cire2222

maybe you guys didn't read thw whole article but he wants to attack the problem at both ends, drill more and consume less. He also touches on uranium which is wher ei think we should head

I wasn't referring to the article at all.
I thought he had the perfect combination of ideas. Like so many other great ideas that won't fly in such a gluttonous society like we have here. Everyone thinks they are entitled to shit because they are American. It's the American way to live beyond your means.

[cire2222]

Originally Posted by trustdnb

Yeah, I guess I have just been seeing a lot of this sort of thing lately, so my comments can be taken as more of a general comment. Bolling does try to balance it out by mention the demand side briefly (basically: drive more hybrids) and also throws some alternatives into the equation. The uranium stuff sounds interesting, at least until I can get my flux capacitor working.

I have been listening to Bolling for along time now so i guess i know he is a big backer of Uranium. When he mentioned Uranium he hits on a big point, the big uranium countries are all friends of ours, the canadians, the aussies etc.. you won't hear "middle east tensions causing urainum to trade up" I don't think uranium is the end all be all problem solver but it will help ease tensions. But that is a longer term solution.
Right now we need a short term solution to help ease the pump cost of our dearest consumers. Bad news is, even if we can cut the price of oil down the prices at the pump won't go down as quick. The refiners have cut earnings in a big way because of the rapid rise in oil, their margins have fallen quite a bit. Once oil goes down they will get a chance to keep gasoline prices up and make those losses back on a better crack spread. So my point is, pump prices are not going down anytime soon.

[MC]

(US) House approves bill which requires the CFTC to curb immediately excessive energy market speculation

Today 05:36pm
(US) House approves bill which requires the CFTC to curb immediately excessive energy market speculation

- The vote in favor of the bill was 402 to 19.
- The bill allows the CFTC to use its emergency powers to lower speculation and gives the regulator the ability to look at over-the-counter markets.
- The emergency powers would also give the CFTC more power to examine overseas trading and exchanges.
- Steps taken by the CFTC could range from increasing margin requirements to temporarily shutting down energy markets.
- The US Senate is expected to take up the bill in July, at the earliest.
- The bill could also face a veto threat by President Bush.

------
I know some of you may be against regulation, but this oil pricing is not based enough on legit supply and demand IMO. I feel like we should see infomercials now about "speculators gone wild". The exponential rise is proof enough for me to know this is a bubble driven on greed and emotion. I still swear I see USO being sold into today despite testing the highs and even piercing them. Until mid day today the general sentiment was bullish (we have to pop), then I heard all doom n' gloom (dow to 9k). That could be a sign...tomorrow will be a big surprising moment perhaps.

What are your thoughts on this regulation attempt and the fact that Bush may veto this? I don't think given his background he has the ability to be impartial and should NOT have the power he does due to conflict of interest, but who the hell cares what we think. Our job is to vote based on the best sounding bullshit and then bend over. And to think "we" re-elected this buffoon.

[trustdnb]

Originally Posted by MC

(US) House approves bill which requires the CFTC to curb immediately excessive energy market speculation

Today 05:36pm
(US) House approves bill which requires the CFTC to curb immediately excessive energy market speculation

- The vote in favor of the bill was 402 to 19.
- The bill allows the CFTC to use its emergency powers to lower speculation and gives the regulator the ability to look at over-the-counter markets.
- The emergency powers would also give the CFTC more power to examine overseas trading and exchanges.
- Steps taken by the CFTC could range from increasing margin requirements to temporarily shutting down energy markets.
- The US Senate is expected to take up the bill in July, at the earliest.
- The bill could also face a veto threat by President Bush.

------
I know some of you may be against regulation, but this oil pricing is not based enough on legit supply and demand IMO. I feel like we should see infomercials now about "speculators gone wild". The exponential rise is proof enough for me to know this is a bubble driven on greed and emotion. I still swear I see USO being sold into today despite testing the highs and even piercing them. Until mid day today the general sentiment was bullish (we have to pop), then I heard all doom n' gloom (dow to 9k). That could be a sign...tomorrow will be a big surprising moment perhaps.

What are your thoughts on this regulation attempt and the fact that Bush may veto this? I don't think given his background he has the ability to be impartial and should NOT have the power he does due to conflict of interest, but who the hell cares what we think. Our job is to vote based on the best sounding bullshit and then bend over. And to think "we" re-elected this buffoon.

Honestly, this is nothing more than a bunch of election year jibber jabber. I am not defending oil "speculators" whoever they are, but I believe this is just a bunch of politicians trying to put the finger the other way. I do believe we need better regulation in the financial markets, as evidenced by the credit crises problems, but we don't need or want the government coming in a fixing prices just because they feel like they have gotten high enough. I really need to post a sign on my forehead: "Oil prices are going up. Get used to it!" First they blame it on the environmentalists who wont let us drill into the Arctic National Wildlife Refuge and the Outer Continental Shelf. Next they blame it on "speculators."

One thing I have been keeping an eye on is the spread between spot crude and futures prices, and the spread between near month and back month futures. Oil futures are still backwardated, meaning that near term prices are still high than anticipated future prices. This spread has narrowed a bit, but it has not gone away. As long as "speculators" are pricing future oil lower than the current rates, I am not willing to say that advance is being engineered by excessive speculation.

[cire2222]

The Drudge Report today pointed us to this article from the New York Times back in October 2001. The key quote from the article is below:

''If bin Laden takes over and becomes king of Saudi Arabia, he'd turn off the tap,'' said Roger Diwan, a managing director of the Petroleum Finance Company, a consulting firm in Washington. ''He said at one point that he wants oil to be $144 a barrel'' -- about six times what it sells for now.

With oil now trading at $144, bin Laden looks to have gotten his wish. Pretty incredible.

[luckylee]

As per this article (July 3, 2008)

Link: Bloomberg.com: Canada

``It's really the structural tightness in the oil market that has empowered investors to confidently pile money into oil,'' said Victor Shum, senior principal at Purvin & Gertz Inc. in Singapore. ``There is money looking for better returns and oil has offered those returns over the last couple of years.''

Sounds like some people are willing to be be the bagholders Then news come out with other stuff like "falling oil demand due to slower global growth" etc then kaboom. Steel and coal - that's the first down leg. More to come...

Brazil - as per July 3 -
Bloomberg.com: Latin America

Citigroup strategists said the Bovespa may drop to 60,000 on further declines in commodity prices. That represents a 7.7 percent cut from its previous estimate of 65,000 and a 1.8 percent decline from yesterday's close.

These guys know how to play the game to make up their balance sheet.



Just my opinion...