[FoRK] How far will the dollar fall? (was: Demonizing the hedge
<k-elliott at wiu.edu> on
Mon Apr 21 11:40:22 PDT 2008
On Apr 20, 2008, at 8:50 PM, Aaron Burt wrote:
> On Sat, Apr 19, 2008 at 02:39:00PM -0400, Luis Villa wrote:
>> ...the rising cost of oil (in large part, though not exclusively, a
>> result of the war in Iraq and resulting destabilization)...
> I'd say that the Iraq invasion had a small role in rising oil prices.
> Production has been at roughly pre-war levels for the past while.
> That Saudi Arabia didn't (and likely can't) increase production to
> rising demand has a much larger role.
Worth noting is that part of the problem/struggle/challenge in all
this is that because of rising demand, and the fact that getting new
oil supplies requires vast amounts of time and monetary capital, the
price of oil doesn't tell us anything about it's scarcity. Any
commodity that has to sort of investment pattern will show large
shifts in price whenever demand increases...
Of course, the great irony in all this is that from a global warming
perspective, expensive oil is _PRECISELY_ what the world needs.
Personally, it may even be preferable to some sort of carbon tax- at
least this way we aren't feeding even more money into the voracious
maw of government...
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