You are correct sir..Oil is not between 50 and 60 as it should be. It is 87 closer to 100 as we near year end.
I don't buy into peak oil in fact, I have gone much further than most in my declaration that demand is not driving the commodity pricing it is speculation alone.
In the futures markets you have three players: producers, consumers and speculators. When money gets loose then speculators go hog wild and stir up asset bubbles. As if this nation hasn't learned a thing.. That is what happened in housing. It wasn't demand, it was speculation.
Right now we have a mess due to the fed pushing down the bond yields and pushing down the dollar at the same time. This will not last much longer and if the US hasn't figured it out, the rest of the globe is not liking it. The dollar is the reserve currency all oil transactions are done in dollars. So what you are seeing is oil prices as a dollar hedge. It is that simple.
As the economy has slowed due to absurd obama policies, the fed has stepped in and gone crazy with Quantative easing and they did so because sammy is failing so miserably.
January can't get here fast enough for the conservatives to take over. This Fed needs to be brought up to the hill for a hostile hearing. That alone will help buoy the dollar.
Paper money is all about confidence. It is clear that the globe doesn't trust bernanke or Obama. And while some continue to blame the Chinese for all of our woes, it is the US government that has created most of the globes problems not China. It is the US that is creating most of the commodity bubbles. Americans are stupid and have elected pro union, pro stupid politicians that don't know a thing about economics.
The reason unemployment is high is because obama is anti-business and pro union. China is pro business and anti union. Sambo has taxed business out of this country and they won't be back. So unemployment has skyed. That idiotic stimulus did nothing. It had nothing in there for business. It was all about expanding government and earmarks.
Rergards
Doug
