So is there any doubt anymore what was driving crude oil 6 months ago?

[StageLeft]

Originally posted by: halik
It was a demonstration of what Soros calls 'reflexivity' - whole bunch of funds got the view that there will be increasing demand for oil and limited increase in supply, so they all bet long on crude oil. As billions of dollars (multiple leveraged) went long on crude contracts, this pushed up the price of crude and the whole thing became self-fulfilling prophecy. As oil climbed, the view that demand will increase was fulfilled by the apparent increase in oil price.

Self-fulfilling prophecy, like much of the market, or even economy in general; it goes up or down substantially due to people's expectations to go up or down and they react accordingly.

It was so obvious to me that it was a bubble set to burst that I have to wonder if short-term run ups in commodities or stocks (like tech bubble) are always this easy to spot. I admit I wasn't paying as much attention before. I suppose each time there is a bubble some people think that "this time it's different; this isn't a bubble", but can anybody report a particular sector of the economy in the past that has exploded so quickly and not retracted; i.e. it really looked like a bubble but in fact was not?

 

[charrison]

Originally posted by: DealMonkey
Queue Charrison to claim it was primarily a supply/demand scenario . . . in 3 . . . 2 . . . 1

As I have said before hedge funds play a part, but the tight supply is what allowed those funds to drive prices as high sa they went. Had oil been plentiful, we would have not seen the dramatic run up and the even more dramatic crash.

 

[LegendKiller]

Originally posted by: charrison

Originally posted by: DealMonkey
Queue Charrison to claim it was primarily a supply/demand scenario . . . in 3 . . . 2 . . . 1

As I have said before hedge funds play a part, but the tight supply is what allowed those funds to drive prices as high sa they went. Had oil been plentiful, we would have not seen the dramatic run up and the even more dramatic crash.

There was no "tight supply". It was forward-sold "demand" that drove prices up. The hedge funds and banks, faced with huge losses, needed something to push up revenues, why not oil?

You can corner the market pretty easily if you're able to write an unlimited amount of future contracts. In fact, a whole decade worth of supply was sucked up in months through futures.

400x leverage is a great thing when you want to reap profits.

too bad that assclown T. Boone Pickens' fund is now down more than 50%. I feel so sad for him.

 

[LegendKiller]

Originally posted by: OokiiNeko
If the speculators drove up the price, the speculators should have reaped all the profit.

Oil companies` profits say otherwise.

It was pure naked greed. As predicted by someone.

They were reaping huge profits.

The oil companies profits were ancillary and still only ~10% profit margin.

 

[Special K]

Originally posted by: LegendKiller

Originally posted by: charrison

Originally posted by: DealMonkey
Queue Charrison to claim it was primarily a supply/demand scenario . . . in 3 . . . 2 . . . 1

As I have said before hedge funds play a part, but the tight supply is what allowed those funds to drive prices as high sa they went. Had oil been plentiful, we would have not seen the dramatic run up and the even more dramatic crash.

There was no "tight supply". It was forward-sold "demand" that drove prices up. The hedge funds and banks, faced with huge losses, needed something to push up revenues, why not oil?

You can corner the market pretty easily if you're able to write an unlimited amount of future contracts. In fact, a whole decade worth of supply was sucked up in months through futures.

400x leverage is a great thing when you want to reap profits.

too bad that assclown T. Boone Pickens' fund is now down more than 50%. I feel so sad for him.

So are refineries and other consumers of crude oil forced to buy the oil through futures contracts? Why couldn't they have just purchased the oil directly? Wouldn't that have saved them a lot of money during the big runup in oil futures prices this past spring/summer?

 

[dmcowen674]

Originally posted by: LegendKiller

Originally posted by: charrison

Originally posted by: DealMonkey
Queue Charrison to claim it was primarily a supply/demand scenario . . . in 3 . . . 2 . . . 1

As I have said before hedge funds play a part, but the tight supply is what allowed those funds to drive prices as high sa they went. Had oil been plentiful, we would have not seen the dramatic run up and the even more dramatic crash.

There was no "tight supply".

It was forward-sold "demand" that drove prices up.

The hedge funds and banks, faced with huge losses, needed something to push up revenues, why not oil?

Jesus F christ. What fucking tards in here.

I even posted the oil depot spills because they were overflowing with oil.

I posted pics of all the oil barges stuck out in the gulf and in the Mississippi because the oil depots were all full.

Hell one of the oil barges just sitting near New Orleans got rammed by another bopat and caused a massive spill.

It's all well documented in my oil thread and yet you still have tards claiming oil was "tight".

The only thing "tight" is your asses.

 

[LegendKiller]

Originally posted by: Special K

Originally posted by: LegendKiller

Originally posted by: charrison

Originally posted by: DealMonkey
Queue Charrison to claim it was primarily a supply/demand scenario . . . in 3 . . . 2 . . . 1

As I have said before hedge funds play a part, but the tight supply is what allowed those funds to drive prices as high sa they went. Had oil been plentiful, we would have not seen the dramatic run up and the even more dramatic crash.

There was no "tight supply". It was forward-sold "demand" that drove prices up. The hedge funds and banks, faced with huge losses, needed something to push up revenues, why not oil?

You can corner the market pretty easily if you're able to write an unlimited amount of future contracts. In fact, a whole decade worth of supply was sucked up in months through futures.

400x leverage is a great thing when you want to reap profits.

too bad that assclown T. Boone Pickens' fund is now down more than 50%. I feel so sad for him.

So are refineries and other consumers of crude oil forced to buy the oil through futures contracts? Why couldn't they have just purchased the oil directly? Wouldn't that have saved them a lot of money during the big runup in oil futures prices this past spring/summer?

Where are they going to buy on the spot market? The spot market sellers aren't going to sell something for less today than they'll be able to sell it in the future. It's just not possible for them to see they can sell oil in 3 months at $100 and then just sell it today at $50.

 

[dmcowen674]

Originally posted by: LegendKiller

Originally posted by: Special K

So are refineries and other consumers of crude oil forced to buy the oil through futures contracts? Why couldn't they have just purchased the oil directly? Wouldn't that have saved them a lot of money during the big runup in oil futures prices this past spring/summer?

Where are they going to buy on the spot market? The spot market sellers aren't going to sell something for less today than they'll be able to sell it in the future. It's just not possible for them to see they can sell oil in 3 months at $100 and then just sell it today at $50.

The whole system is a scam and sham.

 

[LegendKiller]

Originally posted by: dmcowen674

Originally posted by: LegendKiller

Originally posted by: Special K

So are refineries and other consumers of crude oil forced to buy the oil through futures contracts? Why couldn't they have just purchased the oil directly? Wouldn't that have saved them a lot of money during the big runup in oil futures prices this past spring/summer?

Where are they going to buy on the spot market? The spot market sellers aren't going to sell something for less today than they'll be able to sell it in the future. It's just not possible for them to see they can sell oil in 3 months at $100 and then just sell it today at $50.

The whole system is a scam and sham.

Dave, seriously, shut the fuck up. The only thing you're doing is making yourself look like a complete idiot.

 

[dmcowen674]

Originally posted by: LegendKiller

Originally posted by: dmcowen674

Originally posted by: LegendKiller

Originally posted by: Special K

So are refineries and other consumers of crude oil forced to buy the oil through futures contracts? Why couldn't they have just purchased the oil directly? Wouldn't that have saved them a lot of money during the big runup in oil futures prices this past spring/summer?

Where are they going to buy on the spot market? The spot market sellers aren't going to sell something for less today than they'll be able to sell it in the future. It's just not possible for them to see they can sell oil in 3 months at $100 and then just sell it today at $50.

The whole system is a scam and sham.

Dave, seriously, shut the fuck up. The only thing you're doing is making yourself look like a complete idiot.

The most educated American on the internet

 

[LegendKiller]

Originally posted by: dmcowen674

Originally posted by: LegendKiller

Originally posted by: dmcowen674

Originally posted by: LegendKiller

Originally posted by: Special K

So are refineries and other consumers of crude oil forced to buy the oil through futures contracts? Why couldn't they have just purchased the oil directly? Wouldn't that have saved them a lot of money during the big runup in oil futures prices this past spring/summer?

Where are they going to buy on the spot market? The spot market sellers aren't going to sell something for less today than they'll be able to sell it in the future. It's just not possible for them to see they can sell oil in 3 months at $100 and then just sell it today at $50.

The whole system is a scam and sham.

Dave, seriously, shut the fuck up. The only thing you're doing is making yourself look like a complete idiot.

The most educated American on the internet

It's sad that you even represent yourself as American on the internet. That's because anybody that's foreign will think we're full of the most retarded people in the world.

 

[StageLeft]

Originally posted by: dmcowen674

Originally posted by: LegendKiller

Originally posted by: dmcowen674

Originally posted by: LegendKiller

Originally posted by: Special K

So are refineries and other consumers of crude oil forced to buy the oil through futures contracts? Why couldn't they have just purchased the oil directly? Wouldn't that have saved them a lot of money during the big runup in oil futures prices this past spring/summer?

Where are they going to buy on the spot market? The spot market sellers aren't going to sell something for less today than they'll be able to sell it in the future. It's just not possible for them to see they can sell oil in 3 months at $100 and then just sell it today at $50.

The whole system is a scam and sham.

Dave, seriously, shut the fuck up. The only thing you're doing is making yourself look like a complete idiot.

The most educated American on the internet

You'll be banned again soon enough. It's in your nature. You know this as well as we all do. You cannot help yourself. It's why you continue to fail in life outside of P&N, why you keep losing jobs, get arrested looking for space aliens, ad tedium. It's your destiny.

 

[charrison]

Originally posted by: LegendKiller

Originally posted by: charrison

Originally posted by: DealMonkey
Queue Charrison to claim it was primarily a supply/demand scenario . . . in 3 . . . 2 . . . 1

As I have said before hedge funds play a part, but the tight supply is what allowed those funds to drive prices as high sa they went. Had oil been plentiful, we would have not seen the dramatic run up and the even more dramatic crash.

There was no "tight supply". It was forward-sold "demand" that drove prices up. The hedge funds and banks, faced with huge losses, needed something to push up revenues, why not oil?

You can corner the market pretty easily if you're able to write an unlimited amount of future contracts. In fact, a whole decade worth of supply was sucked up in months through futures.

400x leverage is a great thing when you want to reap profits.

too bad that assclown T. Boone Pickens' fund is now down more than 50%. I feel so sad for him.

And if supply was not tight, the speculators would have not been able to buy paper and sell ot for a profit before they had to take delivery of the oil. Once supply went up and demand went down, this house of cards collapsed on them.

 

[OokiiNeko]

So are refineries and other consumers of crude oil forced to buy the oil through futures contracts? Why couldn't they have just purchased the oil directly?

So, you`re saying that first Exxon negotiates a contract with a country to "develop" an oilfield.
That was discovered by Exxon geologists.
Then they pump that crude to a ship with a big Exxon on the side.
Then that ship delivers the oil to an Exxon refinery.
Now the gas from that crude is put into an Exxon truck and delivered to an Exxon station.
And finally you, the consumer, buys that gas at that Exxon station.

If you cannot see where the speculators fit in, you "don`t understand the process".



Worldwide.

 

[LegendKiller]

Originally posted by: charrison

Originally posted by: LegendKiller

Originally posted by: charrison

Originally posted by: DealMonkey
Queue Charrison to claim it was primarily a supply/demand scenario . . . in 3 . . . 2 . . . 1

As I have said before hedge funds play a part, but the tight supply is what allowed those funds to drive prices as high sa they went. Had oil been plentiful, we would have not seen the dramatic run up and the even more dramatic crash.

There was no "tight supply". It was forward-sold "demand" that drove prices up. The hedge funds and banks, faced with huge losses, needed something to push up revenues, why not oil?

You can corner the market pretty easily if you're able to write an unlimited amount of future contracts. In fact, a whole decade worth of supply was sucked up in months through futures.

400x leverage is a great thing when you want to reap profits.

too bad that assclown T. Boone Pickens' fund is now down more than 50%. I feel so sad for him.

And if supply was not tight, the speculators would have not been able to buy paper and sell ot for a profit before they had to take delivery of the oil. Once supply went up and demand went down, this house of cards collapsed on them.

Supply was technically "tight" with housing also. However, the intrinsic value eventually was outstripped by the market price. A regression to the intrinsic value had to occur, whether there was a percieved or actual tightening of supply.

A bubble can be made from the tightest of supplies or the loosest of supplies. All that matters is perception of value, not fundamentals. Perception was manipulated by an upward valuation spiral caused by hedge funds dumping billions into a market that is poorly regulated, poorly understood, and very highly leveraged.

Once one hedge fund blinked and they started taking redemptions is when the house of cards was over. This started because the fall of BSC and LEH, which stopped leveraged loans to hedge funds from *ALL* banks.

 

[blackangst1]

Originally posted by: dmcowen674

Originally posted by: LegendKiller

Originally posted by: dmcowen674

Originally posted by: LegendKiller

Originally posted by: Special K

So are refineries and other consumers of crude oil forced to buy the oil through futures contracts? Why couldn't they have just purchased the oil directly? Wouldn't that have saved them a lot of money during the big runup in oil futures prices this past spring/summer?

Where are they going to buy on the spot market? The spot market sellers aren't going to sell something for less today than they'll be able to sell it in the future. It's just not possible for them to see they can sell oil in 3 months at $100 and then just sell it today at $50.

The whole system is a scam and sham.

Dave, seriously, shut the fuck up. The only thing you're doing is making yourself look like a complete idiot.

The most irrelevant opinion on the internet

Fixed.

 

[Special K]

Originally posted by: OokiiNeko

So are refineries and other consumers of crude oil forced to buy the oil through futures contracts? Why couldn't they have just purchased the oil directly?

So, you`re saying that first Exxon negotiates a contract with a country to "develop" an oilfield.
That was discovered by Exxon geologists.
Then they pump that crude to a ship with a big Exxon on the side.
Then that ship delivers the oil to an Exxon refinery.
Now the gas from that crude is put into an Exxon truck and delivered to an Exxon station.
And finally you, the consumer, buys that gas at that Exxon station.

If you cannot see where the speculators fit in, you "don`t understand the process".



Worldwide.

 

[dmcowen674]

Originally posted by: LegendKiller

Originally posted by: charrison

Originally posted by: LegendKiller

Originally posted by: charrison

Originally posted by: DealMonkey
Queue Charrison to claim it was primarily a supply/demand scenario . . . in 3 . . . 2 . . . 1

As I have said before hedge funds play a part, but the tight supply is what allowed those funds to drive prices as high sa they went. Had oil been plentiful, we would have not seen the dramatic run up and the even more dramatic crash.

There was no "tight supply". It was forward-sold "demand" that drove prices up. The hedge funds and banks, faced with huge losses, needed something to push up revenues, why not oil?

You can corner the market pretty easily if you're able to write an unlimited amount of future contracts. In fact, a whole decade worth of supply was sucked up in months through futures.

400x leverage is a great thing when you want to reap profits.

too bad that assclown T. Boone Pickens' fund is now down more than 50%. I feel so sad for him.

And if supply was not tight, the speculators would have not been able to buy paper and sell ot for a profit before they had to take delivery of the oil. Once supply went up and demand went down, this house of cards collapsed on them.

Supply was technically "tight" with housing also. However, the intrinsic value eventually was outstripped by the market price. A regression to the intrinsic value had to occur, whether there was a percieved or actual tightening of supply.

A bubble can be made from the tightest of supplies or the loosest of supplies. All that matters is perception of value, not fundamentals. Perception was manipulated by an upward valuation spiral caused by hedge funds dumping billions into a market that is poorly regulated, poorly understood, and very highly leveraged.

Once one hedge fund blinked and they started taking redemptions is when the house of cards was over. This started because the fall of BSC and LEH, which stopped leveraged loans to hedge funds from *ALL* banks.

How much does Charrison owe?

Or did he get a bailout?

12-20-2008 AIG owes $10 billion on trades gone bad

Fallen US insurance giant American International Group owes financial firms some 10 billion dollars on speculative trades that turned sour, the Wall Street Journal reported on Wednesday.

The trades have not been explicitly revealed before and would not be covered by the US government's bailout package of more than 150 billion dollars for the troubled company, the Journal reported, citing unnamed sources.

 

[StageLeft]

Originally posted by: dmcowen674
How much does Charrison owe?

Or did he get a bailout?

12-20-2008 AIG owes $10 billion on trades gone bad

Fallen US insurance giant American International Group owes financial firms some 10 billion dollars on speculative trades that turned sour, the Wall Street Journal reported on Wednesday.

The trades have not been explicitly revealed before and would not be covered by the US government's bailout package of more than 150 billion dollars for the troubled company, the Journal reported, citing unnamed sources.

Thread hijack; I don't think the OP would appreciate that. Just a heads-up.

 

[dmcowen674]

Originally posted by: Skoorb

Originally posted by: dmcowen674
How much does Charrison owe?

Or did he get a bailout?

12-20-2008 AIG owes $10 billion on trades gone bad

Fallen US insurance giant American International Group owes financial firms some 10 billion dollars on speculative trades that turned sour, the Wall Street Journal reported on Wednesday.

The trades have not been explicitly revealed before and would not be covered by the US government's bailout package of more than 150 billion dollars for the troubled company, the Journal reported, citing unnamed sources.

Thread hijack; I don't think the OP would appreciate that. Just a heads-up.

Originally posted by: halik
Down some 25% over the last week and half, despite weakening dollar and lower than expected inventories (by ~50% of the forecast).

In related news, hedge fund redemptions are hitting record highs and the word is that friday's 6% move was mainly due to that.

How much of that $10 billion is in hedge funds?

Apparently you seem to know better than the unnamed sources.

 

[StageLeft]

Apparently you seem to know better than the unnamed sources.

I know you didn't intend that as a joke, but it was a good one

 

[LegendKiller]

Originally posted by: dmcowen674

Originally posted by: LegendKiller

Originally posted by: charrison

Originally posted by: LegendKiller

Originally posted by: charrison

Originally posted by: DealMonkey
Queue Charrison to claim it was primarily a supply/demand scenario . . . in 3 . . . 2 . . . 1

As I have said before hedge funds play a part, but the tight supply is what allowed those funds to drive prices as high sa they went. Had oil been plentiful, we would have not seen the dramatic run up and the even more dramatic crash.

There was no "tight supply". It was forward-sold "demand" that drove prices up. The hedge funds and banks, faced with huge losses, needed something to push up revenues, why not oil?

You can corner the market pretty easily if you're able to write an unlimited amount of future contracts. In fact, a whole decade worth of supply was sucked up in months through futures.

400x leverage is a great thing when you want to reap profits.

too bad that assclown T. Boone Pickens' fund is now down more than 50%. I feel so sad for him.

And if supply was not tight, the speculators would have not been able to buy paper and sell ot for a profit before they had to take delivery of the oil. Once supply went up and demand went down, this house of cards collapsed on them.

Supply was technically "tight" with housing also. However, the intrinsic value eventually was outstripped by the market price. A regression to the intrinsic value had to occur, whether there was a percieved or actual tightening of supply.

A bubble can be made from the tightest of supplies or the loosest of supplies. All that matters is perception of value, not fundamentals. Perception was manipulated by an upward valuation spiral caused by hedge funds dumping billions into a market that is poorly regulated, poorly understood, and very highly leveraged.

Once one hedge fund blinked and they started taking redemptions is when the house of cards was over. This started because the fall of BSC and LEH, which stopped leveraged loans to hedge funds from *ALL* banks.

How much does Charrison owe?

Or did he get a bailout?

12-20-2008 AIG owes $10 billion on trades gone bad

Don't use my educated and intelligent posts as a springboard for insanity and stupidity inherent in your posts.

Fallen US insurance giant American International Group owes financial firms some 10 billion dollars on speculative trades that turned sour, the Wall Street Journal reported on Wednesday.

The trades have not been explicitly revealed before and would not be covered by the US government's bailout package of more than 150 billion dollars for the troubled company, the Journal reported, citing unnamed sources.