Posted with Permission by Nicholas Benton owner/editor of the Falls Church News Press,
Sen. John McCain has once against thrust the burden for solving the energy crisis on individual families in the U.S. "It has to start at home," he said yesterday, ignoring the overwhelming evidence that it is deep ideological opposition to any regulation of speculative investment by leaders in his party which has led not only to the explosive rise in food, oil and gas prices, but to the housing mortgage crisis, as well.
Posted by permission of Nicholas Benton, owner/editor of the Falls Church News Press
The Next Shoe to Drop
by Nicholas Benton
The past week's 20-point drop in the market price of oil is primarily attributable to forceful declarations by key Democrats in Congress, including Sen. Jim Webb of Virginia, that they'll investigate the role of dubious speculation in driving the price to its recent peak of $147 a barrel.
Hedge funds and others working on the margins of speculation do not like to operate in sunlight. Like cockroaches scurrying when uncovered beneath a household appliance, the speculators have begun ducking for cover.
If you are looking for a correlation to explain the sudden drop in oil, you can find it there.
When George Soros’ new book The New Paradigm for Financial Markets; the Credit Crisis of 2008 was released, I was eager to read it. Not only does he have a great track record as a progressive but he has been a big (and successful) player in global financial markets. I fully intended to review the book, but before beginning I decided to check out what he had to say on the runaway escalation of oil and gas prices. And in the back of my mind there was the Phil Gramm story. McCain’s chief lobbyist until very recently was a paid lobbyist for UBS, a major Swiss bank which is reportedly in serious trouble. My guess paid off. Gramm is directly responsible for the present the series of economic bubbles which now threaten to bring down the entire U.S. economy.
My first step was to check out testimony given by Soros on June 3, to an Oversight Hearing on FTC Advanced Rulemaking on Oil Market Manipulation, held by the U.S. Senate. While disclaiming expertise on oil markets, he said that he was confident that his “life-long study of bubbles,” allowed him to understand how speculators were responsible for the recent sharp rise in the oil futures market and gasoline prices. By their intervention in these markets they reinforced a prevailing trend toward higher prices. He enumerated the underlying factors pushing the market up and then discussed the role of the financial institutions in creating a bubble.
Posted with permission by permission of Nicholas Benton owner/editor of the Falls Church News Press
In his editorial Benton refers to recent Senate testimony by George Soros and Michael Greenberger, former head of the Commodity Futures Trading Commission. Greenberger was one of three guests today on the Diane Rehm show which was devoted the a discussion of this topic. After reading Benton's editorial below readers might want to listen extremely interesting discussion about the necessity of reintroducing regulations in the commodities markets. Two of the three speakers debunked the idea that the price rise was primarily a question of supply and demand.The discussion also covered the question of future interests, inflation and the sinking. value of the dollar.
It is an hour long but I found it to be well worth the time. You can listen here