Comments on: Denouncing Speculation Here, Promoting Speculation There

By: Ted McKeown

Ted McKeown — Sat, 28 Jun 2008 23:38:23 +0000

Contrary to what US Energy Secretary Samuel Bodman says I don’t think supply and demand are really causing the problem. There are to many other factors at play here. Too many middle men skimming profits. Too much manipulation of supplies and inventories. The price of oil nearly doubled and gas went up a third in just one year and yet figures are coming out that indicate we are using less gas, not more, probably because people are cutting back on gas. That clearly means supply and demand have nothing to do with these prices. Speculation is driving prices !!! Lawmakers blame loopholes in commodities trading like the Swaps loophole or Enron Loophole. Whatever you want to call it, It’s a get rich quick scheme and not much less obvious than a pyramid scheme. There is no way supply is causing this gas crisis. I put the full blame on speculators and commodities traders and I am sick of the smoke and mirrors. The meeting in Saudi Arabia hasn’t achieved any substantial results from what I can see. The price of oil is still going up. There must be something else that’s driving prices up and I think I know what it is. Although il appears to be a good hedge against inflation, a lower dollar and a low oil supply, in reality nothing could be farther from the truth. The main thing driving inflation is oil prices and as inflation goes higher investors buy more oil driving inflation higher again. Some experts predict this will trigger the worldwide recession. This will result in lower gas consumption and it will free up more gas supplies.. I am no expert but even I can see the writing on the wall. Investors are going to loose their shirts on oil. We may be looking at another ENRON. Hedge funds will topple leaving old age pensioners with nothing. The government won’t be able to bail them out this time because the cost would be far to great. The CFTC and ICE will be too slow to react to the cracks forming in commodities trading so the govenment will finally step in. By that time it will probably be too late. http://www.nbtv.ca

By: Anthony V. Petricca

Anthony V. Petricca — Sat, 28 Jun 2008 12:33:11 +0000

When will someone tell the US public that we will have no control of speculation effects on Oil? Speculation is a global enterprise! The US laws do not curtail global trade.
If Congress wishes to control commodity transaction effects on the US economy, They would be better served by eliminating the “Splash and Dash” subsidy loophole and/or creating a hefty export TAX on Biodiesl, Soy,Corn, Canola and their derivatives.

Malaysia and Indonesia temporarily, and frequently, excise this type of tax to control their internal prices vs consumption/exports.

By: Marsh

Marsh — Fri, 27 Jun 2008 15:39:53 +0000

Oh my!! So many victims, so few programs!

You can always trot out a real victim, but the attempt to paint the majority of those who suffered because of their own decisions as victims is truly Elitist.

Like most other decisions, self interest fueled the boom. Made worse by an “I want and deserve it now” attitude. Why budget and save, when you can game the system?

It is the same attitude seen in our current congress, “It is better to be subservient to oil producing countries than gain energy independence”. We are met with a constant cacophony of can’t, won’t and doesn’t from our senators and congressmen. What happened to can and will? Aha, they have fallen prey to our victim mentality and are now victims themselves!

Let’s suck it up, take responsibility for our decisions and move forward.

By: American Man

American Man — Fri, 27 Jun 2008 14:08:34 +0000

We should either limit speculation our outright ban it. If it doesn’t work then we can put it back the way it was.

The purpose of our lives is not to enrich people who could care less what happens to the USA or her people.

By: Corey

Corey — Thu, 26 Jun 2008 20:42:07 +0000

In response to Rod, the government very much steers people to own rather than rent through making mortgage interest deductible and taxing rent in addition to taxing the landlords on the property without homestead exemptions. (I’m not really sure how landlords are taxed, never had an investment prop, but I do know standard homeowners exemption doesn’t apply.) It’s certainly been a large part of my decisions to buy instead of rent on 2 occasions, and to finance larger portions of the home rather than pay it down.

I really don’t understand why people should be penalized for choosing to rent. (Yes, penalize is the correct word. Raising taxes overall to give tax breaks to home owners penalizes renters.)

By: Steve

Steve — Wed, 25 Jun 2008 16:43:45 +0000

where’s my tax funded money? tired of bailing out everyone while attempting to prudently run my own fiscal house. This includes wall street, banks, finance companies, speculators, purchasers. Personally, I would require any bailout to require the executives to be fired with options and bonuses repaid,and the board of directors to forfeit options and bonuses after 2005.

By: Rod

Rod — Wed, 25 Jun 2008 12:52:43 +0000

You are simplifying the subprime crisis with this arguement. There were many, many other factors fueling the fire including poor lending standards by underqualified mortgage originators, falsified documents and borrowers who were better off as tenants than homeowners (oh yeah and this was the private market steering this car not the government!). The government-sponsored programs support homeownership educuation and monitor income before giving loans. Assisting responsible families to enter our country’s housing market is a commendable goal which I, a tax paying citizen 100% support!

By: Todd

Todd — Tue, 24 Jun 2008 19:04:57 +0000

They require reasonably good credit for these loans. Much of the subprime problem stems from giving people with poor credit high price loans. To assume just because one is a first time homebuyer, that they have poor credit is awfully short sighted. This article sucks, as it is based in your head not reality.

By: Corey

Corey — Tue, 24 Jun 2008 17:21:10 +0000

This seems to indicate that you believe speculation should be allowed by highlighting the hypocrisy of the government positions.

I think the extraordinary volatility in the housing market and the people forced to turn down promotions due to being upside down on their mortgages are a direct result of speculation in the housing market. This market has been harmed as much as if not more than the oil market by speculators.

I think the government should be consistent in its treatment of speculation, and that margin rates of 50% should probably be a minimum for any commodity investment, housing included. Obviously homes are the primary debt of the average American, so a special exception could be made, but only for those people interested in actually intending to live in the home. Obviously there would be exceptions, which is how a 2 page law becomes a 6 volume code, but low margin speculation has created (or exacerbated) much quicker and more harmful volatility in many areas of the american economy.

I agree that bailouts for defaulters should not be government financed, and I also believe that the financial companies should have allowed to fail. If that caused much greater damage to the US economy, maybe it would have helped to sway future legislators and mortgage commodity investors themselves from allowing and engaging in so much risk in subprime no-down loans. Now I have to research the ’80’s S&L bailouts and see if the bailout strategy isn’t a direct reason for this happening a mere 25 years later as opposed to nearly 60 years after the 1929 incident with no bailouts.

By: Justin

Justin — Tue, 24 Jun 2008 15:37:14 +0000

good post. the hypocrisy of the bureaucrats never ceases to amaze me. Welcome to America, socialist haven for farmers, corporations, banks, the poor, the rich, the politicians, and the people that got these bureaucrats into office for life. Pure capitalism doesn’t exist here. This nation is a complete welfare state. It’s a terrible blending of communism and fascism. If you are poor or rich, the system is great, but if you are anywhere in between, you are getting sucked dry. We need a free market revolution NOW!!!