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Analysis: Oil showing classic ingredients of an asset bubble

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posted on Jun, 3 2008 @ 10:42 AM
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Analysis: Oil showing classic ingredients of an asset bubble


www.bi-me.com

Over the past two weeks, the crude oil forward curve has flattened dramatically. Fundamental changes cannot explain sudden, severe price or curve movements. As in the dot-com period, when 'new economy' stocks became popular, a growing number of Wall Street analysts have been repeatedly raising their forecasts as oil prices have risen. These revised forecasts have been partially responsible for new investor flows, driving prompt and forward prices to perhaps unsustainable levels.
(visit the link for the full news article)




posted on Jun, 3 2008 @ 10:42 AM
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look this is a long dry boring Lehmann Brothers Energy Special Report...
In short they say the price of oil is being artificially manipulated by speculators to drive up the market and use peoples fear of running out of oil, turning that into pocketing huge profits...

Lehmann Brothers is already warning their investors to stay clear or risk being caught in another bubble bust...

www.bi-me.com
(visit the link for the full news article)



posted on Jun, 3 2008 @ 10:45 AM
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Its been quite obvious for a while that this is the real problem. Indeed, someone posted an article this morning detailing the fact that investment in commodity indexes has gone from $13 billion in 2003 to $260 billion in just five years; a 2,000% increase.



posted on Jun, 3 2008 @ 10:50 AM
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reply to post by DaddyBare
 


Okay, so George Bush's blatant grab for oil has nothing to do with the rise in prices then?

You'd think that by adding to the reserve the prices would come cheaper.

You'd be wrong - because of modern day property valuing (not the kind where you have people come round your house and judge you), the overall price of the entire reserve has risen, so essentially by adding to the reserve, he added to the price.

And why?

He didn't make it official.



posted on Jun, 3 2008 @ 11:05 AM
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reply to post by Anti-Tyrant
 


No.no.no...no one is saying Bush's Policies to help out his "Rich Texas Oil Men" Buddies didn't put us in line for what we see happening now...

What Lehmann Brothers is saying is... speculators wanted in on the money grab too... so with all these people artificially manipulating the market and driving prices beyond what they should be (in double digits not triple) Lehmann Brothers Analysis is warning of a bust... A bust that might leave the Energy Market in shambles when its all over with



posted on Jun, 3 2008 @ 11:23 AM
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It wasn't to terribly long ago that oil was hovering just below the $100 mark. Now it's what, around $130 or so.

I actually remember when it the $100 mark. One single idiot decided he wanted to be the one to hit the mark first, so he placed a minimum order for 1,000 barrels. Then he turns around and immediately sells them at a loss of $99.40 a barrel. He spent $100,000, lost $600 and got himself a bragging right.

After that, things became progressively worse in a short amount of time. It's the speculators. Remember the tech bubble that occurred around 1999 or 2000. Everyone was trying to make a quick buck. It's deja vu all over again.



posted on Jun, 3 2008 @ 11:23 AM
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I didn't say anything about him helping out his 'texas oil buddies' either.

I was just saying that i reckon that whoever came up with the plan to go snatch oil from Iraq for the American people didn't take into account what would happen if they forgot to make it official.

I suppose you could say i'm just not trying to be antagonistic over the whole issue of the questionable nature of that war, instead saying that what was supposed to be accomplished has actually backfired unexpectedly.

One question though;

How exactly are speculators profiting from someone else's business?



posted on Jun, 3 2008 @ 11:36 AM
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Originally posted by Anti-Tyrant
How exactly are speculators profiting from someone else's business?

Quite simple. They buy a commdity at one price and pray they can sell it at an even higher price. It's all about the money.



posted on Jun, 3 2008 @ 11:37 AM
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reply to post by Anti-Tyrant
 


oil is a commodity bought and sold on an open market... just like say pig futures... some people will buy a 1,000 pigs hoping the market for bacon will go up... well others buy oil... you don't need to have a refinery to buy oil your barrels are just part of a huge load scheduled to be shipped on X-date. SO the deal is you buy your???1,000 barrels and hope someone buys it from you for more than what you paid...

artificially manipulating the market would mean some people or groups are buying oil for more then the current market value just to drive up over all prices... Or they buy like 1,000 barrels at $125.00 wait until it reaches $130.00 then sell the other 10,000 barrels they bought at $99 a barrel

you get it now?



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