Magox Posted March 16, 2012 Share Posted March 16, 2012 (edited) Maybe you should try the ACTUAL data from the CFTC--there's more detail--instead of some secondary source like you posted. Check and see how much of the NYMEX market for crude (Code 067651) is made up of actual commercial interests, then tell me how financial players don't influence prices. Can't wait to see how you spin this one... And I'm not denying that the underlying S&D is the most important factor. What's happened is that asset allocation toward commodities, especially oil, is creating greater distortion. Do they add a permanent 15%? No. They cause prices to overshoot for longer periods and they create more volatility. CFTC COT ACTUAL data And in case you missed it, here's the data that Bernie Sanders released which shows holdings of crude futures at the height of the 2008 bubble. Check the largest holders. Yes, someone is blinded by ideology here... Sanders' leaked data For your own sake, stop it! You're embarrassing yourself 321 provides data for traders in an easier format to process. Where do you think they get their information from, captain red herring? Dude, you honestly don't know what you were reading. It is the same information I just provided to you, what percentage of all the transactions were made from "WallStreet speculators"? I know the answer, so lets hear it. And then tell me how that backs up your claim. They cause prices to overshoot for longer periods and they create more volatility. This is a perfect illustration of the lack of understanding you have for the markets. Im sure DC Tom could point to you the contradiction of your statement. Let's put it this way, if you have 1000 market participants routinely bidding on a price in one setting and you have 10,000 market participans in another, in which setting are you going to see more volatility? The one with 1000 or 10,000? Again, you just don't know what you are talking about. In regards to the last link you provided. What have I always said about overshoots? Lets put it this way, where was he price of crude oil 1 week after it hit $147? Where was it 2 weeks after? 1 month? and then 3 month later? I want you to answer this question, so we can all have that information. Obviously I already know the answer, right? So why am I having you provide it for us? Just so I can allow you research the answer so it reinforces the point that I have always made. I really would love for you to read this http://www.cftc.gov/ucm/groups/public/@swaps/documents/file/plstudy_24_ism.pdf Its a study done for the CFTC, not done by ideologues, but from real empirical data. Now since it will go against your preconceived thoughts, I'm sure you will mentally resist it, but this is it. All in a nutshell,and you can have it all read in an hour or so. Also an FYI, speculative positions have been curtailed and reformed, and as I told people before they made these reforms, that it wouldn't make a lick a difference, well, I guess we can see that it didn't. Edited March 16, 2012 by Magox Link to comment Share on other sites More sharing options...
TPS Posted March 16, 2012 Share Posted March 16, 2012 (edited) For your own sake, stop it! You're embarrassing yourself 321 provides data for traders in an easier format to process. Where do you think they get their information from, captain red herring? Dude, you honestly don't know what you were reading. It is the same information I just provided to you, what percentage of all the transactions were made from "WallStreet speculators"? I know the answer, so lets hear it. And then tell me how that backs up your claim. This is a perfect illustration of the lack of understanding you have for the markets. Im sure DC Tom could point to you the contradiction of your statement. Let's put it this way, if you have 1000 market participants routinely bidding on a price in one setting and you have 10,000 market participans in another, in which setting are you going to see more volatility? The one with 1000 or 10,000? Again, you just don't know what you are talking about. In regards to the last link you provided. What have I always said about overshoots? Lets put it this way, where was he price of crude oil 1 week after it hit $147? Where was it 2 weeks after? 1 month? and then 3 month later? I want you to answer this question, so we can all have that information. Obviously I already know the answer, right? So why am I having you provide it for us? Just so I can allow you research the answer so it reinforces the point that I have always made. I really would love for you to read this http://www.cftc.gov/ucm/groups/public/@swaps/documents/file/plstudy_24_ism.pdf Its a study done for the CFTC, not done by ideologues, but from real empirical data. Now since it will go against your preconceived thoughts, I'm sure you will mentally resist it, but this is it. All in a nutshell,and you can have it all read in an hour or so. Also an FYI, speculative positions have been curtailed and reformed, and as I told people before they made these reforms, that it wouldn't make a lick a difference, well, I guess we can see that it didn't. That's hilarious! You cite a study by academics to support your argument. Isn't that ironic. The Irwin and Sanders articles (they also published one for the OECD) were debunked by several other studies, in particular one by Better Markets which was linked in posts here at least a year ago. As for the data you provide... As you'll note in the actual data the quantity of contracts from actual producers/users amounts to no more than 20% of the open interest. What you don't understand is that Swaps dealers are considered "hedgers" and therefore, not speculators--they are included in the commercial interest category of your chart; despite the fact that all of their trades are related to "financial investments," not actual use. Initially the CFTC granted (position limit) exemptions to the big bank swap dealers (goldman et al) because the banks argued they were hedging exposure to investors who bought the swaps--the banks bought futures contracts to back their swap agreements. Eventually this became the rule. So Mr Genius, the chart that you linked to only has two categories of traders, which is the old format. If you look at the actual breakdown, users/producers make up about 30% of the commercial interests from you table; the rest of the commercial interest category are swap dealers listed as commercial traders. Read this, you might learn something...Definitions If you can't figure out that ACTUAL commercial interests make up less than 20% of the market after this then you are hopeless. Better yet, I'll help you out with the pertinent points: The Disaggregated COT report increases transparency from the legacy COT reports by separating traders into the following four categories of traders: Producer/Merchant/Processor/User; Swap Dealers; Managed Money; and Other Reportables. The legacy COT report separates reportable traders only into “commercial” and “non-commercial” categories. Specifically, that report recommended: Remove Swap Dealer from Commercial Category and Create New Swap Dealer Classification for Reporting Purposes: In order to provide for increased transparency of the exchange traded futures and options markets, the Commission has instructed the staff to develop a proposal to enhance and improve the CFTC‘s weekly Commitments of Traders Report by including more delineated trader classification categories beyond commercial and non-commercial, which may include at a minimum the addition of a separate category identifying the trading of swap dealers. Edited March 16, 2012 by TPS Link to comment Share on other sites More sharing options...
Magox Posted March 16, 2012 Share Posted March 16, 2012 (edited) That's hilarious! You cite a study by academics to support your argument. Isn't that ironic. The Irwin and Sanders articles (they also published one for the OECD) were debunked by several other studies, in particular one by Better Markets which was linked in posts here at least a year ago. As for the data you provide... As you'll note in the actual data the quantity of contracts from actual producers/users amounts to no more than 20% of the open interest. What you don't understand is that Swaps dealers are considered "hedgers" and therefore, not speculators--they are included in the commercial interest category of your chart; despite the fact that all of their trades are related to "financial investments," not actual use. Initially the CFTC granted (position limit) exemptions to the big bank swap dealers (goldman et al) because the banks argued they were hedging exposure to investors who bought the swaps--the banks bought futures contracts to back their swap agreements. Eventually this became the rule. So Mr Genius, the chart that you linked to only has two categories of traders, which is the old format. If you look at the actual breakdown, users/producers make up about 30% of the commercial interests from you table; the rest of the commercial interest category are swap dealers listed as commercial traders. Read this, you might learn something...Definitions If you can't figure out that ACTUAL commercial interests make up less than 20% of the market after this then you are hopeless. Better yet, I'll help you out with the pertinent points: YOu can't help me with anything, because you're ignorant when it comes to this subject. And you are gonna try to explain to ME, what a swap dealer is, considering thats who I worked along side with for nearly 8 years, whereas you just looked it up really quick and basically copied it to try to prove you know what you are talking about. NOw thats rich. Listen dipshit, hedgers aren't speculators in the sense that they are'nt looking for upside gains. They hedge based on what we call "pure risk" not "speculative risk". All they are trying to do is offset unforeseen price movements. That's why they hired firms like the one I worked for to try to help them with these strategies. So you're answer is roughly 70% ? Not even half that amount, try again. Dude, just give it up, this is embarrassing. Edited March 16, 2012 by Magox Link to comment Share on other sites More sharing options...
TPS Posted March 16, 2012 Share Posted March 16, 2012 YOu can't help me with anything, because you're ignorant when it comes to this subject. And you are gonna try to explain to ME, what a swap dealer is, considering thats who I worked along side with for nearly 8 years, whereas you just looked it up really quick and basically copied it to try to prove you know what you are talking about. NOw thats rich. So you're answer is roughly 70% ? Not even half that amount, try again. Dude, just give it up, this is embarrassing. This is how you reacted the last time you were wrong. "You're dumb. I'm a trader. I know what I'm talking about." Yes, I just happened to get lucky to find something really quickly that "proved me right"--as you stated, and I'm still ignorant... Btw, I'm not trying to explain to you what a swap dealer is, I'm trying to explain to you that the list you linked to is based on the old two category format of commercial or non-commercial, and swap dealers were counted as commercial in that old format. A simple question: is a swap dealer a user or producer of oil? There is a reason the CFTC changed the reporting format, which you can't seem to understand. Only one of the new four categories covers users/producers, and they represent less than 20% of the market. You can stick to the old format that you linked to, but you would be wrong to conclude anything about the size of commercial interests from that data. Things have changed. Link to comment Share on other sites More sharing options...
Bigfatbillsfan Posted March 16, 2012 Share Posted March 16, 2012 Speaking of Sanders, here's a little diddy on him. Sure hope he had nothing to do with the data. "A senior Vermont Congressman (Bernie Sanders) called, furious about a Florida package we did. I asked what was wrong with the vacation in Orlando . He said he was expecting an ocean-view room. I tried to explain that's not possible, since Orlando is in the middle of the state. He replied, 'Don't lie to me!, I looked on the map, and Florida is a very THIN state!!'' (OMG)" This was from a travel agent. I have no idea if there is any truth to it but thought it could be either him or Joe Biden. This is, in fact, false. Just take the few seconds to look it up before you post. Link to comment Share on other sites More sharing options...
3rdnlng Posted March 16, 2012 Author Share Posted March 16, 2012 This is, in fact, false. Just take the few seconds to look it up before you post. I did Fatty. I also said I don't know if it is true or not, but it sounded like something that would come out of his mouth or maybe Joe Bidens but come to think of it, you might have said it too, that is if you could locate Florida on the map. Link to comment Share on other sites More sharing options...
Bigfatbillsfan Posted March 16, 2012 Share Posted March 16, 2012 I did Fatty. I also said I don't know if it is true or not, but it sounded like something that would come out of his mouth or maybe Joe Bidens but come to think of it, you might have said it too, that is if you could locate Florida on the map. If you did take the few seconds to look up whether this was true or not why the hell would you post it and then say you didn't know if it was true or not? You should have been able to find the answer to that question, you know, when you looked it up. Are you able to read? Link to comment Share on other sites More sharing options...
3rdnlng Posted March 16, 2012 Author Share Posted March 16, 2012 If you did take the few seconds to look up whether this was true or not why the hell would you post it and then say you didn't know if it was true or not? You should have been able to find the answer to that question, you know, when you looked it up. Are you able to read? Because everything you read on the internet is true? Fatty, do you just revel in following me around and making stupid comments? Link to comment Share on other sites More sharing options...
TPS Posted March 21, 2012 Share Posted March 21, 2012 Couple of informative pieces from Bloomberg on the current state of the oil market. My link My link2 Link to comment Share on other sites More sharing options...
3rdnlng Posted March 21, 2012 Author Share Posted March 21, 2012 http://www.redstate.com/vladimir/2012/03/18/flashback-to-2009-administration-policies-sought-to-discourage-%E2%80%98overproduction%E2%80%99-of-oil/ This just shows how disingenuous this administration can be. Link to comment Share on other sites More sharing options...
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