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Politics : President Barack Obama -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (24689)	6/25/2008 3:22:11 PM
From: Sr K	Read Replies (1) \| Respond to of 149317

Some facts are here oilfuturesmarketfacts.com Look at or read the 6/23 testimony by Sir Bob Reid (a director of ICE) and #14 of the 6/24 report by the subcommittee. In Reid's testimony he summarizes the trend of the percent hedged and the percent speculation. Of course there has been a change for WTI, because ICE entered the market with screen-based trading about February 2006. Spreads are tighter and costs per contract are lower then they had been on NYMEX. All ICE WTI futures contracts settle in cash. For every trade there is a buyer and a seller, matched by the computer. Every buyer eventually sells, and every seller eventually buys, although they can roll out further. The number of contracts and percentage that are long and short at any time is available for traders. Similarly, the CBOE puts out daily the number of Equity and Index puts and calls and the ratio. Does anyone think that the creation of or the existence of the CBOE and later options markets has a permanent bias up on equities pricing? Is there a push to limit the right of a trader to go long without a simultaneous limit to short? That's what NYMEX wants and what ill-informed Congressmen want. Specifically, if 70% is "speculation" and if it is 40% long and 30% short, then it is only 10% net long. And it still will get unwound "eventually" aside from the new players that treat commodities like indexes and plan to hold their positions forever. Oil futures index funds may be distorting the market. But eventually the market will determine the price.