60 minutes on the oil manipulation
- Thread starter stock777
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Historians will say that the Enron loophole was much bigger and more pervasive than the Enron collapse. The decision to deregulate the electric energy trading spawn a whole class of semi legal activities that moved on to other commodities trading, especially crude oil.
Subsequently it permeated and corrupted the whole investment banking industry once the banking regulation on their leverage was removed in 2000 by a Republican sponsored bill, mainly by Phil Gramm (R-Texas).
It is inconceivable that deregulation did any good in promoting price efficiency and stability, not in electricity rate in California or the world oil prices.
A lot of these investment bankers and their traders belong in the same place as the Enron CEO, Jefferey Skillings.
Subsequently it permeated and corrupted the whole investment banking industry once the banking regulation on their leverage was removed in 2000 by a Republican sponsored bill, mainly by Phil Gramm (R-Texas).
It is inconceivable that deregulation did any good in promoting price efficiency and stability, not in electricity rate in California or the world oil prices.
A lot of these investment bankers and their traders belong in the same place as the Enron CEO, Jefferey Skillings.
Watching the tonight's program on 60 minutes about CL was about as exciting as watching Dr Phil
pretty lame
Most of the people on ET don't trade for a living. They also have very little clue about the "Commodity Futures Modernization Act of 2000".
http://en.wikipedia.org/wiki/Commodity_Futures_Modernization_Act_of_2000
MS and GS assured 60 minutes that their financial analysts and their oil division are completely separated.
Everyone assumed it was manipulation. Hell, even my mechanic compared it to the West Coast electric manipulation, and as it turned out, it was probably the exact same traders doing it with oil. Funny how the Bush administration missed it, though.
That was some of the worst reporting and weakest reasoning that I have ever seen by 60 minutes. Aside from dollar weakness, they failed to discuss the market perception that relatively inelastic demand in a world of strained supply would squeeze prices up as developing countries competed in a very tight demand-supply balance. If the market chooses to buy those resources at those prices, then participants must be able to do something with those resources and profit from them or else they will not contniue to purchase and produce with those resources. [How dare people try to profit from a precious resource!]
They also failed to recognize that in capitalist societies such as ours, we acknowledge that the decision to allocate capital - beit speculatively or otherwise motivated - reflects a perception of value through the price action of market participants. Prices are merely an attempt to discount future considerations given present assumptions. While perceived value corresponds with risk, in times of crisis risk is amplified and risks of liquidity trump notions of fundamental valuation. Price manipulation, as they would like to call it, is what traders call order flow! Would they prefer that we use a panel of fools to centrally plan what market forces can do for us?
Were shares of countrywide manipulated on the way up? Has the dollar been manipulated over the last week against the euro? The tendency of the media to analyze unpopular price movement and retrofit conspiratorial schemes upon scattered facts is appalling. The only evidence of manipulation I saw in that reporting was the attempt to manipulate public perception against already unpopular industry.
They also failed to recognize that in capitalist societies such as ours, we acknowledge that the decision to allocate capital - beit speculatively or otherwise motivated - reflects a perception of value through the price action of market participants. Prices are merely an attempt to discount future considerations given present assumptions. While perceived value corresponds with risk, in times of crisis risk is amplified and risks of liquidity trump notions of fundamental valuation. Price manipulation, as they would like to call it, is what traders call order flow! Would they prefer that we use a panel of fools to centrally plan what market forces can do for us?
Were shares of countrywide manipulated on the way up? Has the dollar been manipulated over the last week against the euro? The tendency of the media to analyze unpopular price movement and retrofit conspiratorial schemes upon scattered facts is appalling. The only evidence of manipulation I saw in that reporting was the attempt to manipulate public perception against already unpopular industry.
Blah, blah, blah.
This is why Oil ran up to $147.
http://www.bloomberg.com/apps/news?pid=20601104&sid=a1jvjJlVO2tc
Israel wanted to execute a top secret mission to fly over Iraqi airspace with U.S. bunker busting bombs to take out Iran's MAIN nuclear reactor, but tough guy Bush rejected their plea.
This is why Oil ran up to $147.
http://www.bloomberg.com/apps/news?pid=20601104&sid=a1jvjJlVO2tc
Israel wanted to execute a top secret mission to fly over Iraqi airspace with U.S. bunker busting bombs to take out Iran's MAIN nuclear reactor, but tough guy Bush rejected their plea.