Most people with half a brain already instinctively knew this, but for those who want just the facts, here ya go. Trading futures is a risky business on a huge scale. Instead of all the fun you might have going to Las Vegas or Atlantic City, you could just lose your money sitting at your desk.

Of course betting on commodities strikes me as perverse, since peoples' lives depend on food and energy.

Study links oil prices to investor speculation

By H. JOSEF HEBERT, Associated Press Writer Wed Sep 10, 1:03 PM ET

Speculation by large investors — and not supply and demand for oil — were a primary reason for the surge in oil prices during the first half of the year and the more recent price declines, an independent study concluded Wednesday.

The report by Masters Capital Management said investors poured $60 billion into oil futures markets during the first five months of the year as oil prices soared from $95 a barrel in January to $145 a barrel by July.

Since then, these investors have withdrawn $39 billion from those markets as prices have retreated dramatically, the report said. Oil traded at about $102 a barrel Wednesday on the New York Mercantile Exchange.

"We have clear evidence the fund flow pushed prices up and the fund flow pushed prices down," said Michael Masters of Masters Capital Management, calling the amount of money moving into oil futures markets by large institutional investors in the early part of the year "way off the scale."

Masters said its analysis shows investors "began a massive stampede for the exits" on July 15 and that this caused the price decline.

"These large financial players have become the primary source of the dramatic and damaging volatility seen in oil prices," concluded the report.

The report was released Wednesday by House and Senate sponsors of bills to put additional curbs on oil market speculation and comes in advance of a report on oil market speculation expected possibly this week by the Commodities Futures Trading Commission. The commission regulates commodity markets.

Sen. Maria Cantwell, D-Wash., a sponsor of an anti-speculation bill, said the Masters report challenges CFTC claims to date that supply and demand forces — and not excessive speculation — has driven up oil prices.

"This analysis illustrates that when oil speculators poured large amounts of speculative money into oil markets, prices skyrocketed just as they were hoping ... And when the speculative money got pulled out, prices tumbled," she said.

Sen. Byron Dorgan, D-N.D., said he wants to know "how oil speculators were able to drive prices up and down while the CFTC was asleep at the switch."

An interagency task force, led by the CFTC, concluded in an interim report last July that "fundamental supply and demand factors" influence the oil markets and that the data "does not support the proposition that speculative activity has systematically driven changes in oil prices."

Senate critics of the regulatory agency charged that report was based in flawed evidence.

"The CFTC has its head in the sand," said Rep. Bart Stupak, D-Mich., chairman of the House Energy and Commerce investigations subcommittee.

Stupak said the Masters report shows that that oil prices soared when speculators poured money into future markets even as the federal Energy Information Administration was forecasting supply would exceed demand.

Congress for months has been considering various measures aimed at curbing oil market speculation, but those efforts have been thwarted amid disputes over other energy issues from taxing oil companies to new offshore drilling.

Legislation before the Senate would put limits on the amount of oil certain traders, interested only in speculation, would be allowed to purchase in futures markets and give new authorities and staff to the CFTC to regulate oil markets.

(This version CORRECTS SUBS 3rd graf to correct price, $102 sted $1.02. Moving on general news and financial services.)

Source: http://news.yahoo.com/s/ap/20080910/ap_on_go_co/oil_speculation

I watched a couple of good environmental documentaries on the Documentary Channel and was trying to find a good graphic to include in a post. I really like these. Please share these with your friends who drive SUVs or other large fossil fuel polluters. Remember, they are harming the air you and your family breathe.

No, it's not Earth Day, but every day should be. If you can't afford to do much to help the environment, the least expensive things are to replace your incandescent bulbs with compact fluorescent ones. I changed my most commonly used bulbs and my power bill dropped about $10 a month, and I live alone. That could mean higher savings for families.

Tiny

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According to CNNMoney.com:

Oil prices hit a fresh record high Thursday of over $90 a barrel after reports said OPEC had no intention of increasing production.

<sarcasm>After all we have done to bring peace and democracy to OPEC nations, you'd think we'd catch a break.</scarcasm>

Which is the party of Big Oil? The Grand Oil Party (GOP), of course.

The oil industry and its supporters in Congress scored a big victory this afternoon as Senate Republicans blocked a package of tax breaks for renewable energy that would have been paid for by the major oil companies. Fifty-seven senators, most of them Democrats, voted in favor of the package, and 36 against it. But under Senate rules requiring 60 votes to shut off debate, the measure fell three votes short. [NY Times]

The bill called for $32 billion in tax breaks for renewable and clean energy programs and energy conservation, all but about $3 billion to be paid for by oil taxes.

Remember this when you fill up next time and the next time you vote.

Shi Tao

Please consider visiting the AIUSA Web site and at least send the form e-mail there. They make it very easy to do. While there, you may consider other human rights issues worthy of action.

In April 2004, the Chinese journalist Shi Tao used his Yahoo! email account to send a message to a U.S.-based pro-democracy website. In his email, he summarized a government order directing media organizations in China to downplay the upcoming 15th anniversary of the 1989 crackdown on pro-democracy activists. Police arrested him in November 2004, charging him with "illegally providing state secrets to foreign entities." Authorities used email account holder information supplied by Yahoo! to convict Shi Tao in April 2005 and sentence him to 10 years in prison. [Amnesty International USA]

Why did Yahoo! help the Chinese government? Here is one account.

Reporters Without Borders said Yahoo's Hong Kong arm helped China link Shi Tao's e-mail account and computer to a message containing the information. The media watchdog accused Yahoo of becoming a "police informant" in order to further its business ambitions. [BBC]

Stay with me now. The plot thickens. More companies are helping the Chinese government to violate human rights than you may know. This just posted today:

Do you remember when Yahoo! Inc. (NASDAQ:YHOO) was accused of helping Chinese authorities jail journalist Shi Tao? Do you remember Yahoo! CEO Semel's argument that a company must follow the laws of the country in which it operates? It makes sense, of course. But what if the laws of the country clearly violate human rights as determined by the United Nations?

Don't think Yahoo! is alone in this. Amnesty International accused also Microsoft Corp. (NASDAQ:MSFT) and Google Inc. (NASDAQ:GOOG) of violating human rights principles by cooperating with China's efforts to censor the Web. Today we indeed learned that China leads the world in jailing journalists, with 31 behind bars. [bloggingstocks.com]

The US government and other democratic nations (I would easily guess) have put profit above human rights. We keep extending China's "most favored nation" trading status year after year (Democrat and Republican administrations alike) without demanding movement on human rights. It should be widely publicized about any company involved in violating human rights. As a nation, we should contact our representatives and urge them not to renew MFN status to China until it frees political prisoners.

In a last gasp of desperation to turn public opinion about him and our war in Iraq, Bush finally admitted over the weekend that oil was a valid reason for continued war in Iraq.

"You can imagine a world in which these extremists and radicals got control of energy resources. And then you can imagine them saying, "We're gonna pull a bunch of oil off the market to run your price of oil up, unless you do the following." -- George W. Bush, Greeley, Colorado, November 4, 2006. [Washington Post]

After years of denying the war had anything to do with oil, Bush departed from his script. With 2835 deaths (and many more seriously wounded) of American soldiers since this war began three and on-half years ago, did it all come down to oil? Have you no decency, Mr. Bush? In the end, have you no deceny? The war was wrong. Admit it.

How many years have we been fighting the so-called "war on drugs," and how many years has it been nothing but a money and human life-draining campaign?

Now let me be clear. I do not advocate that people use more drugs or any street drugs, but aren't we hypocritical as a nation when we sell alcohol, tobacco, and prescription pharmaceuticals without penalty of law? Wouldn't all the money that we waste in law enforcement and imprisoning non-violent drug offenders be better spent in education campaigns NOT to use drugs. It has been pretty successful with tobacco, since tobacco use is way down in the US. We could also spend more money for drug rehab. In my state of Georgia, if you want to go into drug rehab and cannot afford private rehab, you must be arrested and sentenced by a judge to rehab. What a shame! Think of the hundreds of millions of dollars from law enforcement and incarceration that could flow instead into free programs to help people quit using drugs!

Because we don't decriminalize drugs, it is hugely profitable. Why do you think al-Qaeda encourages poppy production in Afghanistan? Huge profit to support their murderous goals. Of course, then again oil profits do much the same thing, but that is another post.

Over the next week or so, I will post ten steps (maybe more) that we can take to stop the drug war and move to a more humane and sensible policy. But one thing is certain, if you remove the profits from the illegal drug trade, criminal activity in this area will vastly decline.

These steps are from drugsense.org:

Step 1: Grant agronomist Lyle Craker a license to grow medicinal-grade cannabis at the University of Massachusetts.

Effect: End the federal government's monopoly on growing marijuana to meet the FDA's requirement for an independent, high quality cannabis supply for approved cannabis-based research and product development.

Just watched Syriana and watched one of the DVD extras that points to http://participate.net. The movie is fantastic, although you have to see it through to the climax and denouement to see how all the many threads join at the end.

Paramount Classics has committed 5% of the domestic theatrical gross for An Inconvenient Truth to be donated to a new bipartisan climate effort, Alliance for Climate Protection! Read more in our Press section.We've launched our new website for the film An Inconvenient Truth! Pledge to see the film and to find out what you can do to help curb global warming. [http://participate.net]

Like it or not, all of us are complicit in exploiting other people and nations to get low-cost energy. After all, what would we do with gas at $20/gallon at the pump? We think $3/gallon is highway robbery now. We must each pledge to make real changes in how we live and make a smaller footprint in the world. How we do it is up to our individual conscious.