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pandora's box

Why Is The Oil Price Rising?

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It was one of the City’s main predictions that the oil price would crash through $100 per barrel in 2011. But no one thought it would be testing that level quite so quickly.

Brent crude, the oil sold in London, rose above $98 for the first time since 2008 this morning and Kuwaiti authorities are now forecasting that the oil price will top $110 in the next few weeks.

Telegraph link

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All that money they are printing and giving the bankers has to go somewhere.

Similar things happened in 2008 when it all kicked off and Central bank first did their stuff.

Now it (the printing) goes on almost unnoticed by the media.

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It's a game of trading musical chairs since 2007. First it was uranium, then lead, then nickel, then potsash, fertiliser, crude oil, cattle, then wheat, then sugar, then copper, then gold, rare earths, then silver, etc (not strictly in that order). Now we're back to oil and palladium. I'm sure I could draw up graphs, and you can clearly see how hot money flowed from one commodity to the next.

Any long term HPCers will click and remember those string of stories where those commodities "made new 5 or 10 year highs" in the news. It all fits in now.

We've not had natural gases turn, so be ready for the "real" spike in those prices. And keep an eye out for diamonds.

Until interest rates are at double figures, this will continue.

Edited by Money Spinner

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Forgot cotton, now spiking.

---

Where is this 'hot money' coming from and can I have some?

The Federal Reserve, Goldman Sachs et al.

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Where is this 'hot money' coming from and can I have some?

The Federal Reserve, Goldman Sachs et al.

So they are printing money for themselves to speculate on the necessities of life. Basically, risk-free gambling at the expense of the poor.

Is this legal?

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It's a game of trading musical chairs since 2007. First it was uranium, then lead, then nickel, then potsash, fertiliser, crude oil, cattle, then wheat, then sugar, then copper, then gold, rare earths, then silver, etc (not strictly in that order). Now we're back to oil and palladium. I'm sure I could draw up graphs, and you can clearly see how hot money flowed from one commodity to the next.

Any long term HPCers will click and remember those string of stories where those commodities "made new 5 or 10 year highs" in the news. It all fits in now.

We've not had natural gases turn, so be ready for the "real" spike in those prices. And keep an eye out for diamonds.

Until interest rates are at double figures, this will continue.

Wot he said.

Basically it is a mix of currency devaluation from all the QE money printing mixed with speculation and low IRs.

It is causing real pain for hundreds of millions globally though and a dangerous game for the politicians to make. It could well move us into another recession/depression quicker than anyone realises... and it could result in strkes, protests and civil unrests around the World.

Alas, everyone thinks that devaluing their currency is the way to recovery.

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Renegade Wallstreet broker, Max Keiser talks about how 3rd world nations are enslaved by the dollar. They work in factories, say for a dollar a day, and thus are now reliant on those dollars to buy flour, rice, priced in currencies linked to dollars. Global food prices are traded in dollars, if prices go up, you get starvation. This happened in 2007-08 when Mexicans, as I recall, who could not afford food staples.

Yes, inflation is legalised theft.

The issuers of money are bestowed great responsibilities, globally. Some argue, this is being abused, and we should go back to an honest monetary system, backed by precious metals.

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Where is this 'hot money' coming from and can I have some?

It QE money - central banks printing the money.

They 'loan' it to the banks and the banks then go and 'invest' it in commodities, shares and lend it to you and I at 6% and 7% and, in the case of credit cards, at 18% plus.

I can see some serious rioting in EU countries this Summer - already having them in parts of Africa. Have you seen the BBC reporting on the riots in Tunisia? No, of course not - keep it quiet.

http://www.zerohedge.com/article/tunisia-rioting-escalates-hits-capital-more-are-killed-while-protesting-surging-unemployment

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Have you seen the BBC reporting on the riots in Tunisia? No, of course not - keep it quiet.

No of course not. I've been watching the German news channels and this is reported comprehensively.

Edited by ZeroSumGame

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Global food prices are traded in dollars, if prices go up, you get starvation. This happened in 2007-08 when Mexicans, as I recall, could not afford food staples.

Yes, inflation is legalised theft. The issuers of money are bestowed great responsibilities, globally. Some argue, this is being abused...

This isn't legalised theft; it's legalised murder.

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Renegade Wallstreet broker, Max Keiser talks about how 3rd world nations are enslaved by the dollar. They work in factories, say for a dollar a day, and thus are now reliant on those dollars to buy flour, rice, priced in currencies linked to dollars. Global food prices are traded in dollars, if prices go up, you get starvation. This happened in 2007-08 when Mexicans, as I recall, who could not afford food staples.

Yes, inflation is legalised theft.

The issuers of money are bestowed great responsibilities, globally. Some argue, this is being abused, and we should go back to an honest monetary system, backed by precious metals.

The collapse of the dollar doesn't affect the global price of commodities, even if they are denominated in dollars. The currency in which something is quoted is not of first order importance. If your country swaps clothes for oil, and the dollar collapses, then you pay more for your oil but you earn more for your clothes. You still swap one barrel for 100 T-shirts whether oil is $50 and T-shirts $0.50 or oil is $100 and T-shirts $1.

Of course, if countries or individuals keep savings in dollars, then they are being robbed.

Edited by (Blizzard)

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it's legalised murder.

Ah, we enter the relm of New World Order, and the Trilateral Commission, the Illuminati (see my avatar). I won't go into it now, which largely are conspiracy theories.

It's not legalised murder.

I'm doing 'God's work' Lloyd Blankfein Goldman Sachs CEO Nov 2009.

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Inflation conjures human greed and desires to keep running in order to stand still. It brings out something in us not normally found on the surface, I can't describe. A voracious hunger perhaps that pushes us to speculate in bubbles.

Greed, for lack of a better word, is good. Greed is right. Greed works. Greed clarifies, cuts through, and captures, the essence of the evolutionary spirit . Gordon Gekko Wallstreet.

The investment banks are almost purifying the human race in some way - "the fittest will survive".

Edited by Money Spinner

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it's legalised murder.

Ah, we enter the relm of New World Order, and the Trilateral Commission, the Illuminati (see my avatar). I won't go into it now, which largely are conspiracy theories.

It's not legalised murder.

I'm doing 'God's work' Lloyd Blankfein GS CEO Nov 2009.

---

Inflation conjures human greed and desires to keep running in order to stand still.

Greed, for lack of a better word, is good. Greed is right. Greed works. Greed clarifies, cuts through, and captures, the essence of the evolutionary spirit . Gordon Gekko Wallstreet.

The investment banks are almost purifying the human race in some way - "the fittest will survive".

Interesting viewpoint.

Edited by pandora's box

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it's legalised murder.

Ah, we enter the relm of New World Order, and the Trilateral Commission, the Illuminati (see my avatar). I won't go into it now, which largely are conspiracy theories.

It's not legalised murder.

I'm doing 'God's work' Lloyd Blankfein Goldman Sachs CEO Nov 2009.

---

Inflation conjures human greed and desires to keep running in order to stand still. It brings out something in us not normally found on the surface, I can't describe. A voracious hunger perhaps that pushes us to speculate in bubbles.

Greed, for lack of a better word, is good. Greed is right. Greed works. Greed clarifies, cuts through, and captures, the essence of the evolutionary spirit . Gordon Gekko Wallstreet.

The investment banks are almost purifying the human race in some way - "the fittest will survive".

Yeah, it's pretty ******ed up!

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it's legalised murder.

Ah, we enter the relm of New World Order, and the Trilateral Commission, the Illuminati (see my avatar). I won't go into it now, which largely are conspiracy theories.

It's not legalised murder.

I'm sorry, but I'm not going to allow you to get away with that.

If Goldman Sachs have the clout to drive up food and oil prices in the space of weeks, days or even hours , they are directly contributing to the impoverishment and starvation of the world's weakest citizens.

As I said: Legalised murder.

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It was one of the City’s main predictions that the oil price would crash through $100 per barrel in 2011. But no one thought it would be testing that level quite so quickly.

Brent crude, the oil sold in London, rose above $98 for the first time since 2008 this morning and Kuwaiti authorities are now forecasting that the oil price will top $110 in the next few weeks.

Telegraph link

* An increased supply of money (QE etc) sloshing around the commodity markets looking for a return.

* An increased demand in the East adding to overall global demand.

* A decreased supply of oil relative to the above demand

The over-supply of money will sort itself over time, either by government controlled clawback or by uncontrolled currency collapse. The lack of oil supply, however, will not be fixed and will only get worse. In the long run, the price of oil is going only one way

North.

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Why is the spread on Brent crude getting bigger?

Spread vs WTI?

WTI has a fixed physical delivery point (Cushing, Oklahoma) via pipeline and then into limited storage capacity at cushing and then onwards usually via pipeline to other points across the US. The lack of storage means that it can be hard to find buyers willing to pay higher prices to off take at that point vs Brent or some of the other world grades where there isn't a fixed delivery point. The actual volume of Brent (actually an index of Brent Forties Oseberg & Ekofish) can have very small free floating trading volumes for delivery but large trading position for hedging speculation etc so can rise quicker than other benchmarks, the traders are sitting on their hands waiting for the price to go up which they can't do with WTI.

Based on quality Brent should be about 3-4% higher not the ~10% at the moment

Edited by koala_bear

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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