Comments on: Speculators ‘R’ Us: The G8 And Energy Prices http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/ What happened to the global economy and what we can do about it Sat, 21 Nov 2009 02:32:50 +0000 http://wordpress.com/ hourly 1 By: Louis http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-20540 Louis Mon, 20 Jul 2009 14:45:32 +0000 http://baselinescenario.com/?p=4316#comment-20540 Simon HAS IT BACKWARDS - oil price volatility is not a by product, it the cause of the present mess. http://ideas.wikia.com/wiki/Volatility_in_the_Price_of_Oil_since_Hubbert%27s_Peak_and_Investment_Risk Simon HAS IT BACKWARDS – oil price volatility is not a by product, it the cause of the present mess.

http://ideas.wikia.com/wiki/Volatility_in_the_Price_of_Oil_since_Hubbert%27s_Peak_and_Investment_Risk

]]> By: q http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19762 q Sun, 12 Jul 2009 03:23:08 +0000 http://baselinescenario.com/?p=4316#comment-19762 yes, good points as usual. it's clear that mr johnson has one worthwhile narrative to tell -- the narrative of regulatory capture -- and we should all be glad he has put that forward. however, step outside that sphere and there's not much to what he says. yes, good points as usual.

it’s clear that mr johnson has one worthwhile narrative to tell — the narrative of regulatory capture — and we should all be glad he has put that forward. however, step outside that sphere and there’s not much to what he says.

]]> By: Rama http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19709 Rama Sat, 11 Jul 2009 04:13:15 +0000 http://baselinescenario.com/?p=4316#comment-19709 An arithmetic average of G-8 and G-20 seems to have been done and the future summits are likely to be of G-14. http://www.lifeinitaly.com/node/6641 An arithmetic average of G-8 and G-20 seems to have been done and the future summits are likely to be of G-14.
http://www.lifeinitaly.com/node/6641

]]> By: Tippy Golden http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19706 Tippy Golden Sat, 11 Jul 2009 03:38:04 +0000 http://baselinescenario.com/?p=4316#comment-19706 Min, rounding off 1.2% seems right. But I get your point. However, serious stimulus money for innovation to reduce carbon emissions would make for an interesting blog discussion. Min, rounding off 1.2% seems right. But I get your point. However, serious stimulus money for innovation to reduce carbon emissions would make for an interesting blog discussion.

]]> By: Matt http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19681 Matt Fri, 10 Jul 2009 21:03:46 +0000 http://baselinescenario.com/?p=4316#comment-19681 http://www.greenenergyreporter.com/2009/07/how-the-g8-fails-greentech-investors/ http://www.greenenergyreporter.com/2009/07/how-the-g8-fails-greentech-investors/

]]> By: John Papola http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19671 John Papola Fri, 10 Jul 2009 20:06:59 +0000 http://baselinescenario.com/?p=4316#comment-19671 Great points, Simon. Point #3 really dovetails into not just oil but the rest of the bubble economy that has burst from equities to housing. There's the strong undercurrents of Austrian Business Cycle Theory underpinning what you've written there. At a minimum, the Fed needs to bring back the Taylor Rule ASAP. Even better: freeze the monetary base and let the banking system operate more freely to react to real money demand regulated by fear of failure. Ideally, snuff out the Fed and FDIC. Great points, Simon.

Point #3 really dovetails into not just oil but the rest of the bubble economy that has burst from equities to housing. There’s the strong undercurrents of Austrian Business Cycle Theory underpinning what you’ve written there.

At a minimum, the Fed needs to bring back the Taylor Rule ASAP. Even better: freeze the monetary base and let the banking system operate more freely to react to real money demand regulated by fear of failure.

Ideally, snuff out the Fed and FDIC.

]]> By: Patrice Ayme http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19670 Patrice Ayme Fri, 10 Jul 2009 19:57:30 +0000 http://baselinescenario.com/?p=4316#comment-19670 Something else: a carbon tax will bring every body, including China, to heel. And it will be good for employement and real GDP. France, tired of waiting, is thinking about unilateral action in 2010. The ecological minster was made third in command to prepare this. France will drag the EU with her, and so forth. Since it is France which led the entire crack down on CO2 in Europe, this will happen. No choice. Something else: a carbon tax will bring every body, including China, to heel. And it will be good for employement and real GDP.

France, tired of waiting, is thinking about unilateral action in 2010. The ecological minster was made third in command to prepare this.

France will drag the EU with her, and so forth. Since it is France which led the entire crack down on CO2 in Europe, this will happen. No choice.

]]> By: Patrice Ayme http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19666 Patrice Ayme Fri, 10 Jul 2009 19:40:29 +0000 http://baselinescenario.com/?p=4316#comment-19666 Financial agitation and speculation ruins economic reflection and constructive action. Beyond what Sarkozy and Brown suggested (and no doubt Merkel agrees), direct measures ought to be taken to reduce the leverage of non commercial operators in the futures' markets and the velocity of transactions (by introducing a tiny transaction tax; one could not accuse that to reduce liquidity, it would just reduce velocity). The coffin corner model suggests that the economy is losing lift from the shocks associated to the velocity of money, not just simply the oversize of finance (although that is of course a problem). Patrice Ayme http://patriceayme.wordpress.com/ Financial agitation and speculation ruins economic reflection and constructive action.

Beyond what Sarkozy and Brown suggested (and no doubt Merkel agrees), direct measures ought to be taken to reduce the leverage of non commercial operators in the futures’ markets and the velocity of transactions (by introducing a tiny transaction tax; one could not accuse that to reduce liquidity, it would just reduce velocity).

The coffin corner model suggests that the economy is losing lift from the shocks associated to the velocity of money, not just simply the oversize of finance (although that is of course a problem).

Patrice Ayme
http://patriceayme.wordpress.com/

]]> By: Mark http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19665 Mark Fri, 10 Jul 2009 19:25:04 +0000 http://baselinescenario.com/?p=4316#comment-19665 A recent Newsy.com video analyzed media coverage on the progress (or lack thereof) made on carbon emissions at the G8 summit. One cited international source, Xinhua News from China, had this to say about what they saw as a double standard: "While being vague about targets for themselves, the G8 leaders took a tougher position against emerging economies." Obviously, China, along with India and Brazil, is one of the strongest emerging economies, if not the strongest, in the world. A recent Newsy.com video analyzed media coverage on the progress (or lack thereof) made on carbon emissions at the G8 summit. One cited international source, Xinhua News from China, had this to say about what they saw as a double standard:
“While being vague about targets for themselves, the G8 leaders took a tougher position against emerging economies.”

Obviously, China, along with India and Brazil, is one of the strongest emerging economies, if not the strongest, in the world.

]]> By: Uberdave http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19664 Uberdave Fri, 10 Jul 2009 18:50:34 +0000 http://baselinescenario.com/?p=4316#comment-19664 I think they ought to have been more ambitious, and solemnly vowed to cut emissions by 99% by the year 3009. I think they ought to have been more ambitious, and solemnly vowed to cut emissions by 99% by the year 3009.

]]> By: wally http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19659 wally Fri, 10 Jul 2009 18:18:31 +0000 http://baselinescenario.com/?p=4316#comment-19659 Saudi tax, Goldman tax, Microsoft tax... A fine, free world we live in Saudi tax, Goldman tax, Microsoft tax…

A fine, free world we live in

]]> By: E. Barandiaran http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19657 E. Barandiaran Fri, 10 Jul 2009 18:13:15 +0000 http://baselinescenario.com/?p=4316#comment-19657 I have just read Dr. James Hansen's post on the G8 meeting. See http://www.huffingtonpost.com/dr-james-hansen/g-8-failure-reflects-us-f_b_228597.html Although I disagree with some of Dr. Hansen's positions, he illustrates my point: denounce the politicians, especially US politicians. I have just read Dr. James Hansen’s post on the G8 meeting. See
http://www.huffingtonpost.com/dr-james-hansen/g-8-failure-reflects-us-f_b_228597.html
Although I disagree with some of Dr. Hansen’s positions, he illustrates my point: denounce the politicians, especially US politicians.

]]> By: Min http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19656 Min Fri, 10 Jul 2009 17:50:57 +0000 http://baselinescenario.com/?p=4316#comment-19656 Tippy Golden: "Well the G8 did promise to reduce carbon emissions by 50% by 2050 (if I have my facts right here). Thats 1.2% each year. Let’s see if they meet this target by next year’s meeting." Actually, it's more like 1.8% per year. Rots o ruck! Tippy Golden: “Well the G8 did promise to reduce carbon emissions by 50% by 2050 (if I have my facts right here). Thats 1.2% each year. Let’s see if they meet this target by next year’s meeting.”

Actually, it’s more like 1.8% per year. Rots o ruck!

]]> By: Art http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19642 Art Fri, 10 Jul 2009 15:18:37 +0000 http://baselinescenario.com/?p=4316#comment-19642 There were two ways to play the cheap money/gov't guarantee angle over the last several months. The presumed proper way was to bail risk and take on ballast. But a couple of astute parties observed that the no-lose move was to ship risk by the boatload and unfurl all the canvas clear to the sky sails. Watch Goldman's earnings on Tuesday. There were two ways to play the cheap money/gov’t guarantee angle over the last several months. The presumed proper way was to bail risk and take on ballast. But a couple of astute parties observed that the no-lose move was to ship risk by the boatload and unfurl all the canvas clear to the sky sails. Watch Goldman’s earnings on Tuesday.

]]> By: ron http://baselinescenario.com/2009/07/10/speculators-r-us-the-g8-and-energy-prices/#comment-19640 ron Fri, 10 Jul 2009 15:10:48 +0000 http://baselinescenario.com/?p=4316#comment-19640 Shame, shame Simon. You should know that everything you mentioned is irrelevant to the increase in oil prices. You know, for example, that lower interest rates don't guarantee increased demand. Commodity prices were well in hand for decades until the CFTC foreswore regulation and allowed speculators to increase their share of the futures market from 25% to 75%. Do you truly not know this? Shame, shame Simon.
You should know that everything you mentioned is irrelevant to the increase in oil prices. You know, for example, that lower interest rates don’t guarantee increased demand.
Commodity prices were well in hand for decades until the CFTC foreswore regulation and allowed speculators to increase their share of the futures market from 25% to 75%.
Do you truly not know this?

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