Voodoo Economics Story of the Week: Higher Oil/Gas Prices = Better Economy

Discussion in 'Economy' started by Oddball, Oct 27, 2009.

  1. Oddball
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    Oddball BANNED Supporting Member

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    That's right, you heard it here first....Higher prices are indicative that the economy is improving.

    Oil at $80: That's good news and bad news. - Oct. 20, 2009

    Yet, buried in the story, there's this passage:

    The current spin (just heard this one on the radio) is that speculators feel better about economic conditions and that means they're more likely to take chances in the commodities markets.

    Talk about people whistling past the graveyard! :eusa_whistle:
     
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    Last edited: Oct 27, 2009
  2. Mike Mitrosky
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    Mike Mitrosky Member

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    When I was in high school I used to wonder how stocks could go up and down, oil, dollars, etc.. all go up and down regardless of the news.. in fact the news was always spun to explain the movings in the market... as I got older and wiser I realized its all a bunch of bullshit..

    Its like the economic equivalent of this picture:

    [​IMG]
     
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  3. Mr. H.
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    Mr. H. Diamond Member

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    I don't quite understand your criticism. Traders and "speculators" look much further past the ends of their noses in analyzing markets and economic trends.
     
  4. Oddball
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    Oddball BANNED Supporting Member

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    Yes they do.

    However, the spin is that the speculation is somehow proof that they feel like gambling, therefore the economy must be better. How you get from A to B, I'll never know.
     
  5. Mr. H.
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    Mr. H. Diamond Member

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    It is confounding. Major brokerage firms and hedge fund managers have armies of analysts and forecasters constantly searching for profitable investments for their clients. How does this translate to the unemployed? In the short term it doesn't. But it's an indicator of future economic recovery which hopefully will get people back to work.
     
  6. Oddball
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    Oddball BANNED Supporting Member

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    Or it's an indicator of a flight to safety...Almost all commodities are up sharply lately.

    Moreover, more money in the markets means less to hire employees.
     
  7. CrusaderFrank
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    CrusaderFrank Diamond Member

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    Its like when we're in a cooling trend because of Global Warming
     
  8. CrusaderFrank
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    CrusaderFrank Diamond Member

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    It can't mean that Obama and the Dems are destroying confidence in the US dollar so we get charged more ...nah that can't be it
     
  9. Oddball
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    Oddball BANNED Supporting Member

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    It's almost like the same news that would be spun badly to reflect poorly upon a politician with an (R) by his name, can be spun positively when a politician has a (D) by his.
     
  10. The Rabbi
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    The Rabbi Diamond Member

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    It's no mystery.
    Oil prices are higher in anticipation of greater demand. Greater demand must come from more industrial production. Ergo traders are sensing that production will increase and demand for oil will rise.
    Remember when the meltdown started the price of gas fell to below $1.50 a gallon. There was just no demand. So now we see the opposite.
    There are many other factors of course, like a weak dollar. But that's what I'm seeing.
     

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