If you are China and see Bernanke and Geithner pouring a trillion dollars into the economy based on nothing but the faith in the US government, do you not want to get out of dollars and into something that has some value?
http://news.yahoo.com/s/ap/20100409/ap_on_bi_ge/oil_prices#mwpphu-container
Oil prices rose above $86 a barrel Friday on a weaker dollar and after robust U.S. retail sales in March pointed to growing consumer demand in the world's biggest energy market.
By early afternoon in Europe, benchmark crude for May delivery was up 84 cents to $86.23 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 49 cents to settle at $85.39 on Thursday.
If you are OPEC, and you know that it is likely that your kids will be riding camels in a few years because you cannot pump any more oil, would you not want to control the rate of your pumping so that you can have some kind of a future?
If you are the US oil industry, that literally collapsed 18 months ago, putting a screeching halt to exploration activities and refiner modernization, do you not need the higher prices so that you can reinvest in your capital intense, risky business?
Why are the same people that whine about government intervention into the medical system also the ones complaining about the price of oil, which is as close to an open market as we now have? Given the system we now have, it's a market, not an entitlement. If you want it more than the Chinese millionaires, you're going to have to pay for it, as long as we have something that approaches a capitalistic system.
No comments:
Post a Comment