Thursday, June 23, 2011

Oh boy, now Republicans are headed into an insane asylum


Oil and commodities are dominated by speculators. Everyone in the professional trading community knows it. The world is awash in liquidity. There's no where for that money to go. Borrowers don't want to borrow. Lenders don't want to lend. Everyone stashes their money in 0% CDs and savings accounts. Professionals don't want to buy the bonds, because leveraged governments and money printing will soon send rates through the roof and bond prices lower. They don't want to buy the equities. That run is over, corporate profit margins are peaking, world economies are slowing, and retail investors refuse to join the equity party. They don't want Real Estate. No one wants to buy Real Estate, so Real Estate is not going anywhere. The only place left for all this liquidity to go is into oil and other commodities. Thus, we have inflation.

Responsible politicians should see the risk that this excess liquidity poses to pushing commodities to price levels beyond where natural supply and demand forces would otherwise take these prices. Responsible politicians would press regulators to increase margin rates in order to stomp out speculation. Responsible politicians should find ways to punish speculators, in an erratic manner, keep them off balance, so that they never know when they will be subject to having to take massive losses on their speculating activity.

President Obama acted like a responsible politician today. He came out of left field to release oil from our nation's strategic oil reserve. Speculator's got spanked hard. Oil is down 5% off President Obama's actions. Speculators lost a ton of money today. They will now be on notice that releases can happen at the drop of a hat. Speculators will now be reserved about speculating in oil. Oil prices will now reflect a more realistic price level determined by actual supply and demand.

Reaction from Republicans? They can't believe that the President acted in such an irresponsible manner. The are crying foul. They are critical. They are whining. Republicans are idiots. Our Republicans party stands with the speculators and against average Americans. Our Republican politicians are a bunch of dickheads who don't know their ass from a hole in the ground when it comes to real world economic and financial issues.

I'm mad. In fact, I really pissed off at President Obama, for the opposite reason. What the fuck took him so long to act responsibly and punish speculators?

What say you Senator Burr? I dare your sorry, pathetic ass to step to the microphone and criticize lower oil prices. But I don't put it past dickhead Republicans like you to constantly kick middle class America in the teeth.

North Carolina deserves better than Republican Senator Richard Burr.

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