It is interesting to hear the pronouncements on the eminent soaring of oil prices due to the crisis in Lybia. Lybia maybe an oil exporter, but the impact on the world oil supply has literally been nullified by actions by Saudi Arabia. So why is the price of oil still sky high, GREED.
The futures market is the gambling pit for the price of commodities etc. Traders, yes traders, people who profit based on expected impact of world events on the price of commodities, are primarily responsible for the rise in oil prices. With very little investment, these gamblers speculate on the price of precious resources that the general public needs. The outcome of this speculative shinigans determines the rate of inflation and the prices we pay for goods and services.
The financial reform act of 2010 tried to tame this behavior by requiring the Federal Reserve Bank to regulate futures market. This was supposed to lead to increease in the margin requirements on futures contract and thus minimize speculation. Fat chance. The fox cannot guard the hen house. Until we get some agency with enough guts and indepent thought to oversee the Financial markets, we are doomed to life at the mercy of Greed.
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