An article with similar comments was in USA Today this morning.
In a message dated 6/4/2008 11:50:05 A.M. Eastern Daylight Time,
Group44TR7@aol.com writes:
Amici
One of my colleagues and friends is Jim William of WTRG Economics
(_www.wtrg.com_ (http://www.wtrg.com) ). Jim is one of this countries
foremost
experts on oil pricing.
Jim was very surprised when oil prices went soaring above $100. There
is simply not a worldwide demand (or shortage) of oil to justify that price.
Certainly the depreciation of the value of US dollar was a factor, but it
alone was not a good explanation why oil was above even $60 per barrel. Now
an
explanation is emerging that may impact many of you.
Apparently, the increase in prices are due to more pension and
investment fund investing in the commodities market. Yup, your very own
investment
and pension fund may have contracted to buy oil at $130 per barrel. These
funds
now are holding about 1/3 of the commodity paper for oil futures when they
previous held virtually none.
If you think about what the recession is going to do to the demand
for oil, these funds are in a high risk position. So you might want to check
where your investment fund has its money; apparently even some of the large
public employee pension funds have taken positions. Seems like the
investment firms
debacle in mortgages is about to be followed by a debacle in oil futures. Of
course, it their investors moneys.
Jim had just finished an interview with Fox Business News this
morning on this very subject, so if you watch the chanel you may hear him in
person.
Not a big Fox fan, but this time they have a real expert.
Cary
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