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Let's see what happens this week. But with the dollar on the rise, oil should continue to drop. As oil drops further speculators will get out, fueling a further decline. If we can get gas back to $3 per gallon that would be equal to a $75 to $100 boost to each consumer. This would help get our economy back on track. All that means a stronger stock market. Let's see!!!!
Just my opinion,
Jeff Cameron
Showing posts with label stock market. Show all posts
Showing posts with label stock market. Show all posts
Sunday, August 10, 2008
Friday, June 6, 2008
STOCKS CRASH, OIL SPIKES
If anyone was not sure the run on oil is investor driven and not demand driven, then today should make it clear to them. Investors dumped stocks and bought oil futures. Oil is up $17 in 2 days.
I have heard the argument, only so much oil is produced and thus used; there is no oil speculation going on. Here is what happens: Let's say we need 100 widgets for July, we produce 100 widgets for July. We have harmony and prices are driven by the market and at market value. But no, hedge funds(the same guys that caused the real estate boom and bust) buy the futures of the widgets for July in June. July comes along and the buyers for the 100 widgets buy from those hedge funds. This is why the price is artificially HIGH!
I have heard the argument, only so much oil is produced and thus used; there is no oil speculation going on. Here is what happens: Let's say we need 100 widgets for July, we produce 100 widgets for July. We have harmony and prices are driven by the market and at market value. But no, hedge funds(the same guys that caused the real estate boom and bust) buy the futures of the widgets for July in June. July comes along and the buyers for the 100 widgets buy from those hedge funds. This is why the price is artificially HIGH!
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