The Nasdaq fell over 75% after a decade long bull market and the most obscene overvaluation in US financial market history. Oil has so far fallen about 35% after a 3 year bull run and was never 200-300% overvalued like the nasdaq was. So I don't see the falls as comparable - and Pickens losses of 6% are hardly comparable to what tech bulls lost in 2000.
T Boone Pickens: Average $70 oil in 2007
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The Nasdaq fell over 75% after a decade long bull market and the most obscene overvaluation in US financial market history. Oil has so far fallen about 35% after a 3 year bull run and was never 200-300% overvalued like the nasdaq was. So I don't see the falls as comparable - and Pickens losses of 6% are hardly comparable to what tech bulls lost in 2000.
The "little dip" has reached already about -30% and the dip might even not be over. In 2005 and 2006 we never had such a big dip and the trend was much stronger long than it is now. So don't compare 2007 with 2005 and 2006.
He will never admit that he will give up, but sooner or later we will know what he did now. If the market would know he gave up, prices would crash because big money would be made by forcing him out of his probably very big long positions.
Convincing the market that the trend is long is part of his trading, he will never say exactly what his position is, especially not when he is in difficulties, because it would only make his position worse.
The fact that Boone Pickens is succesful doesn't mean he is honest. People mix up honesty with succes. In most cases succes is the opposite of honesty. So never thrust what they say, do your own job. And if you don'y know what to do: stay out of the market.
He will never admit that he will give up, but sooner or later we will know what he did now. If the market would know he gave up, prices would crash because big money would be made by forcing him out of his probably very big long positions.
Convincing the market that the trend is long is part of his trading, he will never say exactly what his position is, especially not when he is in difficulties, because it would only make his position worse.
The fact that Boone Pickens is succesful doesn't mean he is honest. People mix up honesty with succes. In most cases succes is the opposite of honesty. So never thrust what they say, do your own job. And if you don'y know what to do: stay out of the market.
Quote from optioncoach:
Before you jump on his record in 2007, check out his stats in 2005 and 2006. According to him those were his #1 and #2 years ever. I am sure this little dip is not as bad as you think
Yeah first on Bloomberg he says oil prices will drop to $50 in Nov 2005 then does a backflip an says in Feb 2006 that he will never see $50 oil again in hes lifetime. What does that tell you?
Nov. 10, 2005 Crude Will Drop to $50
Oil prices are set to drop to around $50, according to top oil hedge fund manager T. Boone Pickens of Dallas, who is reversing his view from a year ago that oil would surpass $60 a barrel.
That might be a major reason why a record number of positions are currently betting that the price of oil will keep falling on New York's Mercantile Exchange.
"The economy is slowing down and with that, demand will be affected," said former oil executive Pickens, according to a report from Bloomberg.
While Pickens has changed his view on a dime, it comes a little late to help retail investors make a killing from the news.
The news service goes on to say that: "Pickens' oil views have helped him make $2.4 billion from the $37 million investment that began the energy commodity fund. The fund is up more than 328% so far this year, after deducting expenses and fees."
Pickens says that, due to a rise in fuel imports and the outpouring of oil from emergency reserves in the wake of recent hurricane devastation, crude prices are lightening.
On the New York Mercantile Exchange, crude dropped $0.78, or 1.3%, to $58.93 today. That's a 36% gain for the year to date. Prices had previously hit a record of $70.85 after the powerful storm Katrina crippled oil and natural gas supplies and refineries around the Gulf Coast.
Boone Pickens on Bloomberg TV 02-16-2006.
- On the recent pullback in oil prices, he observed that there is too much oil right now and that prices could go down into the lower $50's, but that prices would be back up again before long.
- He predicted he won't see $50 again in his lifetime, and he believes the floor for oil prices is around $55.
- He has been asked many times what price will hurt demand. He doesn't know, but perhaps $75-85
- His view is that if there is no event driven spike in oil prices (say over Iran, Venezuela, Nigeria, etc), prices will rise to $90-100 possibly over the next two years, but if something goes haywire, we could get there very quickly
Well, it tells me that in Nov 2005 he wanted to buy lots of contracts. So prices had to go down as much as possible. That's why he made the statement of the drop.
Once the contracts were bought, market had to go up again. So he made the second statement: we'll never see 50$ again.
It's very realistic that he might get margin calls, the drop is big enough to generate these calls. In that case he has to manipulate the market up. If the market goes long again his positions are saved; if the market stays weak he will try to liquidate his positions without putting too much pressure on the market.
The high prices in the energy futures market are completely artificial, that's why they go up and down so much in such a short time, they are created by people like Boone Pickens. Let's hope that he will be eaten by the monster that he created. Millions of people got in trouble due to the raising energy prices. They had to give more than a billion dollars to Boone Pickens, because that's the money he made on the back of them. Speculation in futures about basic needs should be banned because it is criminal.
I know personally 2 guys who made fortunes in business. Their profile:
They give the impression of being very sympathic and social. But this attitude is artificial, the aim is to create the perfect environment for making money, networking. If they do you a favor, then there is always a financial reason behind it. They never give you insight in what they are after. Often it becomes clear weeks or months after something happened that made me suspicious, and it always confirms that the only thing they are aiming at is making lots of money. Never ask them a financial favor, because they will always find an excuse for not helping you.
Don't forget the weather.
Akuma
Akuma
"The high prices in the energy futures market are completely artificial, that's why they go up and down so much in such a short time,"
rubbish.
the high (or low) prices in ANY market are a function of supply and demand. I am talking supply and demand of willing buyers and sellers at any given price level. when the insistence of the former causes them to bid up the price it goes up, and when the insistence of the latter causes them to offer out at lower and lower - it goes down.
there is nothing "artificial" about it. price is OPINION
and if you want the opinion of the market as to oil, you don't just look at the front month, you look at the spread. that tells you what the market is encouraging (storage etc. contango vs. backwardation etc.)
saying it is "artificial" reminds me of the loser-trader meme that the market is "manipulated" by those who keep calling for a top in equities (and have done so for weeks here)
FWIW, i do believe that a big part of the drop in oil was the liquidation of hedge funds. the tape, and this is based on talks with a longtime nymex trader, clearly showed some massive forced selling
remember, the market doesn't move cause it wants to move - it moves cause it has to move
rubbish.
the high (or low) prices in ANY market are a function of supply and demand. I am talking supply and demand of willing buyers and sellers at any given price level. when the insistence of the former causes them to bid up the price it goes up, and when the insistence of the latter causes them to offer out at lower and lower - it goes down.
there is nothing "artificial" about it. price is OPINION
and if you want the opinion of the market as to oil, you don't just look at the front month, you look at the spread. that tells you what the market is encouraging (storage etc. contango vs. backwardation etc.)
saying it is "artificial" reminds me of the loser-trader meme that the market is "manipulated" by those who keep calling for a top in equities (and have done so for weeks here)
FWIW, i do believe that a big part of the drop in oil was the liquidation of hedge funds. the tape, and this is based on talks with a longtime nymex trader, clearly showed some massive forced selling
remember, the market doesn't move cause it wants to move - it moves cause it has to move
his nat gas short more than made up what he smoked in oil, cant say the same for 2007.