Saturday, July 19, 2008

Cantwell tackles investors

Senator Maria Cantwell says commodity investors are enemies of the state, because the price of oil went up. She decided that the run up in oil prices is due to an evil genus of people called speculators. Not due to the tight supply and rising demand in China and other developing countries. In this case she might not be doing much damage. (In other cases she is.) She is blocking the nominations of three people to the Commodity Futures Trading Commission.
Cantwell ... and others think that speculators have driven up the price of oil and could be responsible for more than $1 of the cost of a gallon of gasoline at the pump.
She should close down the NY Stock Exchange, NASDAQ, all of them. Because people and pension funds go there intending to sin: to buy and make a profit. But she compounds this action with ignorance of basic economics:
Cantwell and most Democrats oppose lifting the offshore-drilling ban. They quote the Department of Energy as saying that offshore oil and gas wells wouldn’t come online for seven to 10 years and the impact on prices would be insignificant.
Notice that they never trust "Bush!" and his administration except when they can take administration statements out of context to advantage. Any increase in supply will tend to decrease prices, even one years in the future. See my unpublished letter to the SeaTimes on the same ignorance in an establishment spokesman. Question for Senator Cantwell: I bought my house hoping to sell it at a profit. Am I a speculator? Are you proposing a law to prevent me from profiting on the sale of my home? Question for Senator Cantwell: The price of oil went down 12% this week. Do the speculators get credit for this? Hat tip to Orbus. Cross posted at Sound Politics. My first entry in about a year.

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