Severe deflation? What deflation?

It baffles me that (1) you think you could read so much about anyone's personal character from casual Usenet postings, and (2) that you would demean and insult people with your fanciful estimate of their brains. Neither would seem to win you any friends, advance your own knowledge, or even suggest you hold a "academic understanding of economics", given that the academy values collegiality instead of acrimony.

Right now we have a number of nation states that became very dependant on oil prices during the good times.

OPEC has used quota's to keep supply tight and the price up. It isn't working now.

How long before everyone in OPEC, desperate to fund their economies, start to cheat on production?

Wes

-- "Additionally as a security officer, I carry a gun to protect government officials but my life isn't worth protecting at home in their eyes." Dick Anthony Heller

All of the farmers in the area took a hit on ther harvests. Fertilizer, oil and everything else needed to plant the crop was trippled in price, but now the bottom fell out of the market they are just holding on. Bring back the words cornering the market and apply the federal laws against do it. The Hunt bros. tried t do it in the silver market but got burned, the speculators did it this year and almost got burned but we bailed them out so thay can do it again to us.

I wonder how long a local co- op would last before the govt closed it down? WE have almost everything we need to live located in the local area. Now we even have natural gas wells in PA. We already have the largest supply of antricite coal ( hard coal) in the world within a radius of 50 miles. I got to get my little coal to oil still going.

John

John

One of the problems is that oil storage tanks are at a premium. With all the epa regulations and insurance costs of having a big tank of oil sitting around had made the oil business a JIT (just in time) operation. That is one reason a little Hiccup in the process, remember Katrina, caused a big shortage of oil. I see now that the Saudis are building a mega storage facility in their desert area as big as a football stadium. My opinion is that OPEC is not as evil as wall street hedge fund speculators. Prevent anyone but a user to buy commodes except to fill a contract. Let the speculators only sell contracts.

John

>

I have always believed that only users and producers should be able to be in the futures market for energy. Back in the 90's iirc, is when non traditional investors got involved. The price took off from there.

Wes

OK but the purpose of the futures markets is to get capital behind production to create stability. Somebody has to be in the middle to write the contracts and create a market for them Wes.

Sort of. Things really got out of control when a ruling passed that allowed trading outside of regulated or monitored exchnges without any oversight or reporting enforcement. That and a culture of laxness and incompetance at the highest agency levels here in the US. Madoff, for example, was blacklisted by a couple of the bigs but rather than investigate what was rather extrordinary behavior, our guys blew it off. With a couple of days work under current rules the guy would have been history.

JC

LOL Hopefully I'll never be that hungry. Besides, cats can sense danger and relocate to an "undisclosed location."

Well if you believe in a company that is producing, you can directly invest. I'm not against that. That is where speculation should occur imho.

Wes

BUT...if you can catch them, they taste like chicken. d8-)

-- Ed Huntress

It's a precious gift and a heavy burden...d8-)

Ah, Rich, one of the characteristics of the self-proclaimed virtuous is that they tend to have large blind spots. I give what I get, and what I got, before commenting on your apparent thoughts, was this judgment about *my* thinking:

"I'll bet Ed even believes in the ultimate Keynesian sophistry, the 'paradox of thrift'"

And then there was this fanciful estimate of my brains:

"You have a inflationary bubble mind block, like the bailout politicians."

And then there was a negative reaction to my use of metaphors, which you say are:

"Revolting, foolish, lying, vacuous rhetoric to disguise the truth."

Finally, you read my personal character from casual Usenet postings, identifying me as a friend of gangsters:

"So I see you are all for the government picking winners and using force to keep people 'employed'. Legalized gangsterism."

You'll find that I tend to follow the level of discourse with which I am confronted. After the litany above, I was getting a little ticked off, so I no longer felt compelled to use restraint. d8-)

Plenty of friends, thanks. My friends don't usually call me a sympathizer with gangsters, or tell me what I believe in.

Once a conversation degrades to such comments as the ones you made above, advancing knowledge becomes problematic.

Yes, it does. So, what happened above?

-- Ed Huntress

And you are so generous in sharing it with us all. I regret I can't afford the time to respond to your impressive volume of personalized analysis rendered as Usenet postings.

The case for a huge deflation being in progress grows daily. Besides all the $trillions of paper that disappeared in the asset bubble, commodity hoards, and stock market, these guys suggest the reserve currency dollars are another deflating money supply:

I go back and forth wondering whether this deflation can even be re- inflated by the US government on such a scale, versus worrying that the re- inflation will overshoot and cause an utter collapse of the dollar.

It would have been enough if you responded to the incidences in which your sarcasm and judgment preceded my reaction. But, watching your pattern, I really didn't expect it.

No doubt this is heart-warming, since, as a virtuous saver sitting on guaranteed assets, your gain is their pain.

There is growing concern about how employment will be restored even after a GDP recovery. We're coming off a series of bubbles and some serious economists now think we're bubble-dependent: an idea that's been lofted by a lot of doomsayers over the past few years, but which now is catching on with the steadier hands and centrists.

I'm going to plant lots of vegetables this coming spring. d8-)

-- Ed Huntress

A huge asset price bubble collapsed, even the previously reasonably priced stock market collapsed to very cheap levels, and the effect of that on core CPI (food and energy excluded) was nil.

The reason for this is the inflationary Fed policy.

So re-inflation can work and will work, as inflating ourselves out of debt seems to be the current grand strategy.

Unfortunately, this will also inflate us out of our currency assets.

This crisis will make almost everyone poorer, homeowners, stock owners, those who hold cash etc. Very difficult to not lose money.

On Mon, 22 Dec 2008 00:35:26 -0600, the infamous Richard J Kinch scrawled the following:

Would you two _Get a room!_, please?

-- Women and cats will do as they please,

and men and dogs should relax and get used to the idea.

--Robert A. Heinlein

Why don't you busy yourself talking to Gunner. He'll keep you distracted from any serious talk about the economy or where our lives are headed. Maybe you can debate the proper calibers and handloads for killing liberals. d8-)

-- Ed Huntress

The price may go up instead. There aren't as many new refrigerator boxes available for the homeless, these days.

I was talking to the pastor of a local church this morning. Someone backed a big car into their concrete block pump house & storage building. It will likely have to be torn down and replaced. I suggested that they buy a couple shipping containers to block off the back side of the property, so people can't use their parking lot as a shortcut and cause similar damage. They had 1/2" steel cable anchored between pieces of used power poles for a rear and side fence, but the rednecks just ripped them out. I doubt they can move fully loaded 40' containers. It will be even harder if they are joined, back to back. :)

We are a little over an hour's drive from a holding area in Tampa, Fl. so the transportation cost won't be as bad as to some places. Al they have to do is talk the zoning people into it, claiming that it's not only a fence and storage facility, but corrects part of the parking problem by removing the old building from the center of the rear parking lot. It wouldn't be hard to dig a shallow pit for the well pump, and move the water tank to the rear of the church building.

A few nuts and bolts and a complete redesign and you could have flat-pack containers :-)

Mark Rand RTFM

How would you get them to meet DOT regulations?