POST SCRIPTS

Jack; in answer to your question, the answer is no. Not only no, but HELL NO!
I believe that National Assets are just that. They belong to us as a nation! To essentially just give these away to private companies is abhorrent.
To ask young men and women to sacrifice their very lives for this "National Interest" while allowing others to profit off of it, is the very definition of immorality.

Quentin that is my feeling as well. The hedge fund speculation in oil futures is a recent phenomena and as such it is legal ONLY because the law has not kept up. Thank your Congressman or Congresswoman for that one.

George Soros who once said he would be happy to spend his fortune to remove GWB (McCain too I imagine since he will not "pull out" of Iraq) from office...and who funds Moveon.org...and who is credited with bringing down the value of the British pound and was convicted in France for similar activity...is ONE OF THE BIGGEST hedge fund managers in the world. He claims the British pound would have fallen anyway (justification?) but that's not what the British think. Anyone want to speculate as to whether he might be playing this game now for political effect?

He has also said that (paraphrasing) he believes we all have a civic duty to care for the less fortunate ( his motivation for Moveon activity?)...and when it comes to investing he competes looking out for his own best interest first....he invests to win personally (without civic concern?)

This from Reuters yesterday:

Jim Rogers, the former business partner of legendary financier and philanthropist George Soros, is perhaps the best-known investor in broad-based commodity funds. He started shifting his money to commodities in the 1990s. On his trips around the world, he came to realize that almost everything, from nickel to cacao, was in short supply in a globalized economy. ** He's laid bets on rising prices ever since. This has had an impact on the entire industry, because Rogers' International Commodities Index is a benchmark for countless funds. These moneymaking machines have attracted billions in investments in recent years, and some of that money has been pumped into futures contracts, heating up prices even further. ** But now Rogers, of all people, is warning: "Unless something happens soon, we will see people not getting any food at all, at any price. This is the sort of thing we read about in history books, but now I'm afraid that it could happen again." ** From his perspective, though, the calamity is not the fault of investors like him, but of developing countries' policies -- like imposing export bans and capping prices. This deprives farmers, who face rising costs of necessary items like fuel and fertilizer, of any incentive to produce more rice. ** "I think this attitude is morally reprehensible," says Rogers. "These governments would rather let people starve than allow prices to rise naturally." Removing price controls, he says, is the only way to increase rice production levels once again. ** Farmers, after all, wouldn't give away their rice to the poor, says Rogers. But he fails to explain how the poor should pay the higher prices in the first place. Perhaps it's up to politicians?

Good article...find it here:

http://www.spiegel.de/international/world/0,1518,549187,00.html

Just found this bit of info from National Review Online. This might have been the cause, or part of it, for refinery production being down.

The federal government can do something right now to provide relief to Americans facing higher food prices: Repeal the ethanol mandate. The diversion of one-third of the American corn crop into ethanol production is a direct result of the 2005 law that required gasoline makers to buy 7.5 billion gallons of ethanol — a mandate that the 2007 energy bill President Bush signed in December increases to 36 billion gallons by 2022.

Ok..I may be the bad guy here, so let me make sure I understand...

Speculators buy a particular commodity expecting prices to be higher when the product goes to market. Growers, refiners, producers, etc. of said market essentially sell their product (oil, corn,etc.) to the speculators at a fixed price, understanding that changes in the market could mean that they are selling their goods at a minuscule profit, or even a loss. But in this scenario, both the buyer and seller must agree to the sale for the transaction to occur.

So essentially, the speculator is betting that he can sell it at market for a price higher than what he paid for it.

That, I have absolutely NO PROBLEM WITH!

Or is the real problem, that a commodity is bought, and held in order to drive prices up.

That, I also don't have a problem with.

So what do I have a problem with...

Excessive gas taxes, government subsidization, government regulation PREVENTING competition, environmentalists preventing us from using more efficient sources of energy namely nuclear, etc. etc. etc.

The point is, that when I see an economic problem, and I follow the problem back, it almost always leads to government. In some way, shape or form, most of our problems can be traced to the government attempting to control the free market.

THAT is what is immoral.

Quentin once again completely misses the point. Oil IS essential, which is exactly why we need less government regulation, not more!

And as far as risking lives for natural assets, give me a break. The well being of the United States is why lives are risked; and oil is an important part of that equation.

"no blood for oil" is one of the most ignorant slogans ever coined by the left. They picked it because "No blood for a vital natural resource that happens to be the building block of all modern economies" while FAR MORE intellectually honest, doesn't exactly serve their purpose (and it doesn't fit on signs as easy).

As far as allowing people to profit by it. How is that "immoral"? Now I know that having a debate about morality with Quentin is a touchy subject, but Ill give it a shot.

Quentin, you are a teacher, do you do it for free? or do you receive a "profit"?

To which you reply, "well no one is dying to protect my freedom to teach".

To which I reply, really? Do you drive a car? Do you fly in planes? Do you heat your house? Do you buy any thing which utilizes oil byproducts like Plastic? Not to mention the fact, that this reply doesn't even get to the fundamental question.

Is Quentin claiming that it is bad to make a profit on the selling of ones own property? Or only if that property is oil? I feel quite certain that Quentin takes an ENORMOUS profit for the value of his time as a professor.

So, Jack, I'm going to need you to dumb it down for me a little. What exactly is the problem, because so far, I'm not seeing it.

I guess I'll join, reluctantly, the "bad guy" brigade.

Do you know who Robert Shiller is?

Good question, I decided to find out.

This article excerpt from National Review Online , although off subject, reveals a decidedly leftist bent in Robert Shiller, who it would seem, is a lifelong "bear" with an attitude toward building wealth that frankly stinks, believing as he does that the poor lose if the wealthy aren't made to give it up to government for redistribution:

http://www.nationalreview.com/nrof_luskin/luskin200503220826.asp

The economics professor who may have coined the expression “irrational exuberance” has been acting pretty irrational himself lately, having just published a shoddy and deceptive “paper” designed to torpedo President Bush’s ideas for Social Security modernization with personal accounts. And the leftist media has been entirely too exuberant in publicizing this bogus research. ** …Shiller says his simulated life-cycle portfolios were “designed to capture the President’s proposal.” Yet all of his simulations are based on hypothetical life-cycle accounts ** …to make life cycle accounts look even more “disastrous,” Shiller uses historical returns that are far less than those actually achieved by the investments he is simulating. Instead of using returns from U.S. markets, he uses returns from an average of 15 countries. What, exactly, is the relevance of those 15 countries? Today the country ranked 15th by gross domestic product is Indonesia — is there really any point in including the investment history of such a country, except that in doing so the president’s proposal is made to look bad? ** Shiller didn’t come up with all this realism alone, by the way. On the first page of his “paper” he thanks Jason Furman “for substantial assistance.” Furman is currently with an ultra-leftist think tank, the Center for Budget Policies and Priorities. He was also director of economic policy for the Kerry-Edwards campaign. ** If the way Shiller cooked the numbers in his “paper” isn’t bad enough, some of his incidental commentary plainly reveals the irrational depth of his antipathy for Social Security modernization. He says personal accounts would be a form of “government intervention,” and would be nothing more than a plan to encourage people to buy stocks and bonds on margin, that is to borrow money to buy stocks, with the Federal government as the lender. ** With that statement, Shiller stands athwart the fundamental truth that animates the whole concept of the ownership society — it’s your money. There’s no intervention, no borrowing, in personal accounts. Quite the contrary — there is empowerment and returning ownership of your money to you.

The following represents part of his idea for taxing Americans into "quality:

http://query.nytimes.com/gst/fullpage.html?res=9B0DEFDE1F3FF936A25756C0A9659C8B63

"If the nature of the economy changes, and a small number of people capture the lion's share of pretax income, then the tax rates on them would automatically rise, and the tax rates on lower-income people decline, until today's level of inequality was restored. Higher taxes on the high incomes would be imposed exactly at a time when the few are suddenly becoming enriched relative to the many. There would be no delays while politicians debated whether taxes should be raised or cut.

Find the Center for Budget Policies and Priorities here:

http://www.cbpp.org/

Good run down Tina!!!

Nick makes good points about free capitalism and market forces taking care of the problem. This is very libertarian and in a perfect world I would say why not. However, we know that the goverment has repeatedly stepped in to add checks and balances when appropriate and sometimes EVEN when not appropriate too! (that happens way too much)

It is arguable that allowing mega-funds to speculate on oil futures punishes the consumers and creates a national security risk and that, just possibly, and only in this one area that is so critical to the economy and health of the nation, we might want to just say NO to mega-funds speculation. This commodity is off limits. It's just a thought. I know there can be good points made on both sides too, this is not a black and white issue.