Kudos to MMs

[nitro]

Oil > $85. To me, this is unacceptable given that most people can't even afford to pay for food.

The FED is now behind the curve. They don't care though, I would estimate that 85% of their decision to move rates are based on wage inflation, not anything else that affects normal people.

 

[Daal]

Quote from nitro:

Oil > $85. To me, this is unacceptable given that most people can't even afford to pay for food.

The FED is now behind the curve. They don't care though, I would estimate that 85% of their decision to move rates are based on wage inflation, not anything else that affects normal people.

The Fed cannot control the supply and demand for crude oil

 

[ammo]

i agree about controlling supp/demand but its been public knowledge for months that they have so much they cant store it, its sitting on the water in tankers,so no supply problem, this is just manipulation

 

[nitro]

I think you are both right and wrong, but more wrong than right imo.

"...The lesson here is simple: there is no “over” or “under” supply, there is only the price at which the market clears. And over the long-term, high oil prices will tend to encourage consumers to either reduce energy consumption or shift to other forms of energy. Similarly, investment in either inhospitable areas or in developing technologies will result in greater quantities of oil or synthetic crude coming on to the market. Each boom in the oil price sows the seeds of its own destruction."

http://theoildrum.com/node/2899

I think that 20% of the current price of oil is due to hiding money in tangible crucial assets where few other exist. Raise FFs rates to 1% and see what happens.

 

[Daal]

Quote from nitro:


I think that 20% of the current price of oil is due to hiding money in tangible crucial assets where few other exist. Raise FFs rates to 1% and see what happens.

What about providing some evidence for this?Just keep in mind that YOU are the you trying to go into a brave new world saying a central bank just coming out of a banking crisis and STILL in a credit crunch needs to increase real interest rates
Plus ignoring the fact the inflation keeps going down for as much as 24months in the aftermath of US recessions

You are ignoring that whatever benefit of a lower oil price(which might not even decline materially) will be offset by the fact that credit conditions could easily send the economy back to recession. You better off paying up for gas than lining up at the soup line

 

[talebi818]

If FF raises rates, banks wouldnt be able to loan money to Oil and Gas companies. In which the companies wouldnt be able to buy and hold oil and gas in reserve.

 

[nitro]

"NFV" ~1184.45

 

[nitro]

Quote from talebi818:

If FF raises rates, banks wouldnt be able to loan money to Oil and Gas companies. In which the companies wouldnt be able to buy and hold oil and gas in reserve.

Ja.

 

[nitro]

"NFV" has been caving fast and hard over the last two sessions. At ~1182.61.

It was as much as 20 handles above SPX. At the time of this writing, it is four below SPX.

 

[nitro]

"NFV" ~1180.38