Friday, August 8, 2008

Ready for dislocations for the shorts?

Weren't the shorts betting against the US Dollar? And betting on higher oil?

The dollar has rallied massively against the euro and the pound. And the speculators in oil are getting ready to be killed.

How about the long position of 460 million barrels by a speculator?

How much firepower has been spent defending this position? If there is an alleged shortfall between supply and demand by a million barrels a day, what difference does 460 million barrels make at pricing on the margin? That's a million barrels a day for 15 months.

Does anybody think that the market will let him out? Take him out of this position? Oil is ready to get slaughtered. The route first starts in currencies. We see that happening now. The next step is to smack commodities again, but mostly to crack oil. We need oil down with $8 dollar daily losses for a few days in a row.

All these oil bulls that said oil was a "currency" are just full of themselves. Go out 8 years in futures and check the price of oil? Why is it so much cheaper?

So you want electronic dollars, or do you want oil? All these players attempting to rig the price of oil, with futures are going to find out that the oil companies will hit their bid. And unless they're carrying a barrel of oil on their back, they will taken out en mass.

Because that's what this market is about. It's about carrying speculators out on a stretcher. Most players don't have a choice. They don't sell when they can, they sell when they have to.

Yesterday, stock bulls lost their heads, and shorts pressed their bets across the board. Watch what happens when the shoes on the other foot. If you knock down oil, you change the psychology of the consumer. Lower oil prices means higher stock prices.

When Belzoni moved the head of Ramses II, (Caphany Arabic for the Granite One) the biggest problem was coordinating it's passage with the tides of the Nile.

And the tides are going out in the oil market. It's time for a check on who's swimming naked. We know it's not the Mideast. They have the oil.

It's the pretenders in the pits!

1 comment:

Anonymous said...

The same phenomenon resulting in lower oil prices will also result in lower home prices, lower stock prices, and lower overall commodity prices. One thing that will go higher are interest rates (increasing default risk), and the dollar. Cash is king in a deflationary spiral.