Gas prices and Mike tyson

[SapulpaSooner]

Going the to the gas station to fill up your car is like getting punch in the face by mike Tyson it hurts like hell and there is nothing you can do about it. :eek:


http://www.youtube.com/watch?v=g0dSq5p4gYo&NR=1&feature=endscreen

[SoonerNate]

HOPE AND CHANGE!

[hawaii 5-0]

Well, at least not everyone is crying.



http://thinkprogress.org/2011/04/13/koch-industries-price-gouging/




5-0




Trump/Gramps 2012

[pphilfran]

Well, at least not everyone is crying.



http://thinkprogress.org/2011/04/13/koch-industries-price-gouging/




5-0




Trump/Gramps 2012

Little, if anything, we can do...crude is traded on a world wide market...

You too can make a bunch of money if you got the nutz...go play the futures market...I am sure you can make a killing...easy money with little risk...

[SoonerNate]

Little, if anything, we can do...crude is traded on a world wide market...

You too can make a bunch of money if you got the nutz...go play the futures market...I am sure you can make a killing...easy money with little risk...

But when Bush was in power the Dems were blaming him so I'm blaming Obama. What's good for the goose...

[hawaii 5-0]

Little, if anything, we can do...crude is traded on a world wide market...

You too can make a bunch of money if you got the nutz...go play the futures market...I am sure you can make a killing...easy money with little risk...


No thanks, no speculating here. I'll think I'll stay with a bit more conservative portfolio.


5-0


Trump/Cramer 2012

[pphilfran]

No thanks, no speculating here. I'll think I'll stay with a bit more conservative portfolio.


5-0


Trump/Cramer 2012

But it must be easy money if those dudes are risking many millions....

[hawaii 5-0]

But it must be easy money if those dudes are risking many millions....



Millions to risk ain't much if you have billions to play with, yeah?




5-0




Trump/Mr. Mystery 2012

[pphilfran]

Millions to risk ain't much if you have billions to play with, yeah?




5-0




Trump/Mr. Mystery 2012

At least they are taking possession...

I don't like it any more than you do but there is really nothing that can be done...ya gotta pick your battles and this one is far down my list...

[salth2o]

Thanks a lot Obama! :rolleyes:

[SapulpaSooner]

:D

[SoonerKnight]

But when Bush was in power the Dems were blaming him so I'm blaming Obama. What's good for the goose...

Ok. Hold on! Bush invaded Iraq oil goes up! Bush starts buying all the extra oikl on the market for the reserves and prices go up!! Big difference here! :rolleyes:

[Leroy Lizard]

But when Bush was in power the Dems were blaming him so I'm blaming Obama. What's good for the goose...

Yep. Gas was high because "Bush is helping out all his friends in the petroleum business." Bush was going to have his oil buddies drop the price right before the elections, remember?

[VeeJay]

Obama is still griping about what he "inherited."

He was supposed to fix all that - not be a whiny tittie baby for four years.

[soonercruiser]

Well, at least not everyone is crying.

http://thinkprogress.org/2011/04/13/koch-industries-price-gouging/

5-0

Trump/Gramps 2012

"Think Progress"????
You mean think regressive, don't you?

The Alinskyians like OBama won't be happy until gas hits $5 a gallon!
He would like all of "US" back on our bicycles. (While he's flying the wiffie and staffs around on vacations)
That way he can control us better.

[walkoffsooner]

Bush wasn't smart enough to know how to drive up oil prices or lower them. Now his daddy that's another story, but his daddy was a good president.

[sappstuf]

Well, at least not everyone is crying.

http://thinkprogress.org/2011/04/13/koch-industries-price-gouging/

5-0

Trump/Gramps 2012

I hope you read this... I also hope it is the very last link to a Lee Fang article you post.... Ever.



The Think Progress web site is a Soros-funded mouthpiece for the Obama administration. Someone at Think Progress or its parent, the Center for American Progress, has instructed cub reporter Lee Fang to devote full time to attacking Charles and David Koch and their company, Koch Industries. (It would be interesting to know who gave that instruction, and why.) We have deconstructed several of Mr. Fang's attacks, all of which have been juvenile. But his latest effort is perhaps his most pitiful yet.

In "The Contango Game," Fang tries to show that Koch Industries "manipulates the oil market for profit." Unfortunately, young Mr. Fang has neither the business experience nor the intelligence to understand the issues about which he writes. The result is that nearly every sentence is a howler. Among other things, while a contango market is the main subject of Fang's post, he doesn't know what the phrase means.

Fang begins with the claim that oil prices are high these days because of speculation. Whether it is even possible for "speculators"--some call them investors--to have a material impact on the price of oil over time is dubious. While partisans like to blame speculators for rising oil prices--never, however, for falling prices--objective studies, like this one (http://www.cftc.gov/ucm/groups/public/@newsroom/documents/file/itfinterimreportoncrudeoil0708.pdf) by the Commodity Futures Trading Commission in 2008, have failed to document any such influence.

Moreover, if you don't like commodity futures investors--sorry, speculators--you are barking up the wrong tree by attacking Koch Industries. Koch buys and sells physical oil; it transports oil; it refines oil. It does some unhedged trading too, but in that field it is a minor player compared to, say, Goldman Sachs. If Think Progress wants to attack petroleum speculators, Goldman Sachs should be in the dock--except that Goldman Sachs is a top contributor to Barack Obama and the Democratic Party.

Our cub reporter continues:

While much of the attention on oil speculators has rested on the
backs of investors and commodity traders, the petrochemical
conglomerate Koch Industries occupies a unique role in manipulating
the oil market.

This is just ridiculous. In the world of petroleum, where Exxon Mobil is number fourteen on the worldwide list, Koch is hardly in a position to "manipulate" anything.

Koch has little business in the extraction process. Instead, Koch
focuses on shipping crude oil, refining it, distributing it to retailers
-- then speculating on the future price. With control of every
part of the market, Koch is able to bet on future prices with
superior information.

Huh? Koch sells oil to retailers, and "then" speculates on the future price? Isn't that a little late? One wonders whether these people even read what they write before publishing it.

And what is this about "control of every part of the market"? Fang just made that up. The oil business is highly competitive, and Koch Industries is, in international terms, a small player. Let's take refining: the U.S. Energy Information Administration publishes data on America's biggest refineries. Koch owns three of the 141 largest refineries in the United States; its biggest weighs in at number twelve. So how, exactly, does Koch "control every part of the market"?

Young Mr. Fang continues:

In 2008, Koch called attention to itself for "contango" oil market
manipulation. A commodity market is said to be in contango when
future prices are expected to rise, that is, when demand is
expected to outstrip supply.

This is incorrect. "Contango" is not "market manipulation." On the contrary, it is the natural state of most markets. It simply means (http://en.wikipedia.org/wiki/Contango) that at a given time, the price of a forward or futures contract is trading above the present spot price. This is what you would expect, given the time value of money. Occasionally, for various reasons, this usual condition may not hold; then we have what is called "backwardation." A contango market has nothing to do with any expectation; rather, if the futures price is higher than the spot price, as is normally the case, it is a contango market.

It is quite remarkable, really, that anyone would try to write a blog post about a contango market without even knowing what the term means. Mr. Fang continues:

Big banks and companies like Koch employ a contango strategy by
buying up oil and storing it in massive containers both on land and
offshore to lock in the oil for sale later at a set price. In December
of 2008, Koch leased "four supertankers to hold oil in the U.S. Gulf
Coast to take advantage of rising prices in the months ahead."

An interesting claim. Koch certainly does buy oil and store it; it is in the oil business. However, I would be curious to know what "big banks" "buy up oil and stor[e] it in massive containers both on land and offshore." In any event, if Koch or any other company has sold oil on a futures contract, it has to produce or buy the oil and store it until the contract comes due. This, apparently, seems sinister to young Mr. Fang. I am guessing his experience in the business world is not extensive.

More:

Writing about Koch's contango efforts to artificially drive down
supply, Fortune magazine writer Jon Birger noted they could be
raising "gasoline prices by anywhere from 20 to 40 cents a gallon"
at the time.

Pretty much every word of this sentence is false. Contango is the most common market condition, not an "effort[] to artificially drive down supply." And Fang simply misquotes the cited Fortune article, which claims that "a 200,000 barrel-a-day decrease in supply could raise gasoline prices by anywhere from 20 to 40 cents a gallon." It did not attribute any such decrease in supply to Koch Industries or any other company.

Mr. Fang continues:

Speaking with the Business Times, Koch executive David Chang
even boasted that falling crude prices in 2008 provided an
opportunity remove oil from the market for future delivery:

CHANG: The drop in crude oil prices from more than
US$145 per barrel in July 2008 to less than US$35 per
barrel in December 2008 has presented opportunities for
companies such as ours. In the physical business,
purchases of crude oil from producers and storing offshore
in tankers allow us to benefit from the contango market
where crude prices are higher for future delivery than for
prompt delivery.

This is a good opportunity to clear away the mists of confusion and explain what was going on in late 2008. Due to the worldwide recession, the demand for crude oil plummeted. Refineries didn't want any more oil; they couldn't sell all that they were producing, and their storage facilities were full. At the same time, oil production continued; you can't turn oil wells on and off like a light switch. Thus, the spot market plunged to a fraction of what it had been months earlier. There was almost no demand for immediate delivery of oil.

At the same time, refineries knew that they would be selling their inventories over time, and demand was expected to pick up. Thus, refineries wanted to lock in future deliveries of oil at reasonable prices. This led to an unusually steep contango curve; that is, the price of oil to be delivered, say, six months in the future was considerably higher than the price of oil to be delivered immediately. Another way of putting this is that there was a huge demand for storage of crude oil. Anyone who had the financial ability to buy large quantities of crude without quick resale, and had access to storage, was able to make good money. That is exactly what Koch Industries and a number of other companies did.

This is not "market manipulation," it is market satisfaction. Koch sold oil when customers wanted it, at a price dictated by the market. The problem with web sites like Think Progress and smear artists like Lee Fang is that they have zero understanding of economics and zero understanding of business. Thus, pretty much everything they write on these topics is wrong. They cater to an audience of the ignorant.

Let's wrap up. Poor Mr. Fang concludes with this howler:

A recent presentation from Koch Supply & Trading, the Koch unit
devoted to selling financial products, confirms that Koch has taken
advantage of a lax regulatory environment to aggressively trade on
future oil prices. "The return of speculators to Oil, the 'macro trade'
is alive and well," reads slide 36:

The Power Point presentation embedded in Fang's post was given by a Koch Supply & Trading employee at a conference in Geneva. Its intended audience was prospective clients for Koch's risk management services. Companies like airlines, for example, need to assure themselves of a future supply of petroleum products, and need to manage the risks associated with price fluctuations. This is a service that Koch Supply & Trading provides. If you actually look at the Power Point presentation, it is an impressive product. It explains Koch's expertise in this area. The reference to "speculators" had nothing at all to do with Koch Industries, but rather was one line in a discussion of prospects for future price movements.

The basic problem with a site like Think Progress is that its "reporters," ill-informed, uneducated, inexperienced amateurs like Lee Fang, try to write about subjects of which they have no understanding. Worse yet, they slander the very people who do understand those topics--the people who produce products and make our economy go.

There is another level of irony here. Koch Industries is a classic example of an American company that doesn't just push paper, but actually makes products. Its business is production, not "speculation." Think Progress, on the other hand, is funded by one of the world's most successful speculators: George Soros. Soros has made billions by manipulating markets, without ever producing anything. He is the definitive speculator and market manipulator (in particular, currency markets) of the 20th century. If Soros bothered to read what his minion Lee Fang wrote, he no doubt would burst out in laughter at Fang's ignorance. But that, apparently, doesn't bother Soros. He is happy to promote ignorance as long as it advances his own selfish political interests.

And a nice response to this article from Craig Pirrong:


I wrote the book on manipulation (The Law, Economics, and Public Policy of Market Power Manipulation, Kluwer, 1996). I've also published 10 scholarly articles in economics journals and law reviews on the subject. My next book (Structural Models of Commodity Price Dynamics, Cambridge UP, forthcoming) is all about the determinants of contango, backwardation, storage, etc. Based on 25 years of scholarly research and market experience, I can say that Fang the Farcical knows not the first thing about either manipulation or commodities pricing. You would think that Soros could have found a junior assistant trader to teach Fang the basics. But then there wouldn't have been a story, would there?

[hawaii 5-0]

It's really nice that someone actually steps forward and defends the sleazy powergrubbing Koch Brothers.


Good Job !!!!!!



5-0


Trump/Beevis 2012

[SoonerBread]

It's really nice that someone actually steps forward and defends the sleazy powergrubbing Koch Brothers.


Good Job !!!!!!



5-0


Trump/Beevis 2012

Did you read it?

[REDREX]

It's really nice that someone actually steps forward and defends the sleazy powergrubbing Koch Brothers.


Good Job !!!!!!



5-0


Trump/Beevis 2012---Yea ---those awful Koch brothers that have created 80,000 jobs

[sappstuf]

Did you read it?

You can lead a horse to water...

[dynersooner]

I dont know the first thing about commodity trading, but Mr Fang sure sounds like he knows more than teh guy who wrote the rebuttal.

[pphilfran]

It's really nice that someone actually steps forward and defends the sleazy powergrubbing Koch Brothers.


Good Job !!!!!!



5-0


Trump/Beevis 2012

You are such a tool....

[sappstuf]

I dont know the first thing about commodity trading, but Mr Fang sure sounds like he knows more than teh guy who wrote the rebuttal.

http://scienceblogs.com/omnibrain/dilbert-sarcasm-supportiveness-difference.jpg

[dynersooner]

thaaaaanks alot! roms not gonna post for a week now cause hes trying to figure out that dilbert.

i hope your happy.

[REDREX]

Rachel Maddow is an arrogant tool

[REDREX]

Crude up $2.22 today