posted on Jun, 12 2011 @ 04:09 PM
Politicians scapegoating speculators as a means of diverting attention away from their own egregious spending habits is as predictable as night
When gasoline prices spike they cite over-speculation to pacify a disgruntled constituent base. But when prices fall, it's because OPEC ramped
production, refinery utilization is up, global demand is down, or some other basic fundamental like a decline in crack spreads or high inventories.
Speculators buy prices up, and sell prices down based on these fundamental inputs. Without specs to provide market liquidity, price discovery,
and assume risk on behalf of producers, the commodities exchange would cease to exist.
If politicos want to blame speculation when prices rise, they likewise have to credit speculation when prices fall...but that my friends will never