Anatomy of an oil price CRASH! : LUSENET : TB2K spinoff uncensored : One Thread

Well, OK it's not exactly oil, but unleaded gasoline futures. However, the refinery problems that were predicted to occur as result of Y2K issues seem to have occurred, for some reason or other. Here's what the unleaded gasoline future chart looks like:


That doesn't look much like a crash to me, but I'm sure CPR can explain why it really is, if anyone is still listening to him.

-- Sergeant Friday (just.the@facts.maam), June 13, 2000


I certainly wish this forum had a preview feature. Anyway, here's the URL: Maybe somebody else can make the picture work.

-- Sergeant Friday (just.The@facts.Maam), June 13, 2000.

Oh, by the way, the October ninety cent unleaded gasoline call that I bought on May 30th at 325 is now at 500. That translates into an increase from $1365 to $2100. Pretty good for an "idiot", eh?


for my challenge to CPR.

-- Sergeant Friday (just.the@facts.maam), June 13, 2000.

Since it is not Sept. and end of contract time; the Fat Person has not wharbled yet.

SO..........Buy more.

Double and triple up with your equity.

Then you can loose your chump change faster.


-- cpr (, June 13, 2000.

You really don't know anything about commodity option trading, do you? It's not possible to pyramid options that way, as they must be fully paid for; no margin is permitted. The only way I could leverage up with options is to sell the one I have and buy more at a higher strike. So far, I bought one and sold it for a double, and put some of the proceeds into this one. I may do the same again if the future prices still look incorrect to me.

By the way, in case anyone is interested in the meaning of a "inverted" or "backwardated" futures market: what that means is that MOST market participants BELIEVE that prices will be lower in the future. It does not mean that they WILL be lower in the future.

So far, my expectation that prices were not going to go down as fast as others in the market believed they were has been correct and quite profitable. So far, CPR's expectation that prices would CRASH has been incorrect and would have been very unprofitable for anyone who followed it. But I guess that just must be beginners luck, right?

-- Sergeant Friday (just.The@facts.Maam), June 13, 2000.

You remind me of the original demented Andy who would surface on TB I anytime Gold was selling at a peak. He was talking about gold "to a $1000" at 325 (just like Gary Lord of the Dark) and gold promptly fell to 285. Today its 287. One day, the UK or the Swiss will auction more flood the market again and gold will continue its **20 year Fall**.

You are STILL a moron because you are bragging that you still own at this level. Get back to me when you own 100 of something or have information of value.

You are gambling because of your ego and to prove your manhood. Who cares?

In essence you are no better than one of Regis' winners at Million dollar multiple guess, a rather steep price for Trivia knowledge. At least Charles Van Doren had to answer questions directly and not be spoon fed the answers.

There is **no** "belief" system in a pure commodity market though there most definately is one in Common stocks and even in bonds (investors believe X% is a good return therefore bond rise or fall). The Wheat Harvest doesn't care about that. Only Gold is erratic because of the Fruit Loops who "believe in Gold".

You have been preaching that crap for months because YOU do not understand the definition of what a "commodity" is.

If I'm an oil jobber with storage tanks for 1 million gal./month and demand of 500K, in an inverted market I would be a fool to buy in the spot to stock for future resale at a lower price FORCED on the market by the inversion.

Go back and learn something instead of repeating your falsehoods.

There is one rule of investing or trading one needs to know: when the "public" knows something, its time to do the exact opposite of "conventional wisdom" and /or exit a market. The illogical extremes of the Dot Com market which had "no tomorrow" is a good example of that.

OPEC will ship and ruin your play. If not today or next week, as soon as they decide the pipelines are filled with hoarders, they will open the faucets and burn the speculators. JUST EXACTLY THE SAME Way they did in APRIL. (When you disappeared as the prices dropped, Big Mouth.)

Again, commodity markets do not rise and fall on "belief". They do so on supply and demand and the fundamentals of that. The current shortages in the spot have created the inversion and it will end when OPEC opens the faucet again. It is possible to deduce the "movements" based on the charts but one must be an expert technical analyst to know when the critical turning points come.

I'm following a stock now that has plunged from 138 to 15 then recovered to the mid-20s. All the way down the bulls talked about a turn any day now. The same is true with oil in reverse. The overall trend is UP, the intermediate trend is up but the immediate trend is "overbought". In a spike like this (and the one in NG) you have speculators betting the farm. When the reaction happens, they can't cover the margins and sell out. If a major trend line is broken or the moving averages violated, the turn has come.

In OIL, it will come when OPEC ships. That is not a question of debate. It is one of history. There was NO Y2k "problem" in refineries that one single person can document, What has happened is that OPEC has decided that Consumers world wide can and should pay XX PRICE. We have exceeded that price and demand will fall on the supply demand curve.

Then you will learn that you know NOTHING.

FOOLS who listen to "investors" on the internet and take free advice from people like you earn what they get.

When you KNOW what OPEC is going to do, please let the world know. All YOU now know is what the "commentators" tell you and that equates the crap found daily in quotes from brokers and traders in the WSJ's "Heard on the Street". Josephson discussed that in a book on his early days on Wall St. in 1926 when "leading traders" told reporters why X or Y rose or fell 2 points the day before.

It still goes on daily now in Year 2000.

Keep trading them and you learn the "house always wins" big time and the house is the brokerage fees.

I do trade options on stocks (usually long term way out of the money ones). We made a killing on MU years ago when a chip encapsulation/packaging plant burned. I really did enjoy selling at $11.25 vs. a cost of 37 cents. Unlike you, I knew what that one plant meant in terms of supply of semis especially dRams. MU was the only company that was a pure play in that one piece of information.

-- cpr (, June 13, 2000.

Blah, blah, blah. As usual, you have missed the point entirely. It's not OPEC that is the problem; it's the refineries. Or, to be more precise, it may indeed be partially OPEC, as they seem unable to increase production as they have said they would do. You, of course, believe them. Why? I don't know; you'll have to answer that. However as long as you're going to believe OPEC, you might as well also believe them when they say that it is not their problem that is causing gasoline prices to move so much higher, but that it is a problem with refineries.

By the way, I haven't said that the refinery problems are Y2K related. Maybe they are, and maybe they aren't. But whatever their cause, they don't seem to be going away. I'm betting that they won't go away anytime soon. Regardless of what OPEC does. And if I'm right, anyone who believes you know what you're talking about with respect to commodity prices, gasoline in particular, and acts on your predictions, will regret it.

Will you then apologize to them, as you have demanded that the "doomers" should do to those they "misled"? Somehow I doubt it.

-- Sergeant Friday (just.The@facts.Maam), June 13, 2000.


You have an ego that's as big as Texas. : )

I would like to point out that an inverted market does not GUARANTEE that prices are going lower. It certainly means that the majority of market participants BELIEVE that prices are going lower. It may even be that in most (or even all) past instances, prices HAVE gone lower. It does not (and cannot) mean, however, that prices MUST go lower.

It is this type of invincible (and faulty) reasoning that leads professionals like those at LTCM to get burned so badly.

-- J (Y2J@home.comm), June 13, 2000.

-- (, June 13, 2000.

Y2K is happening, just a lot slower than we expected because of stocked-up inventory. Coming soon to a country near you... massive depression.

-- Mini Me Yourdon (will.cpr.swallow.his.words.@.or.choke.on.them?), June 13, 2000.

Sergeant Friday

"just the facts, maam".

Could you enlighten me regarding the facts about failures at refineries, such as the where the problems are, the nature of the problems as they regard to Y2K, etc.

And no conjecture. Just the facts.


-- CJS (, June 13, 2000.

I feel sorry for the two-some or three some this camp has installed. I was warned of the price increase. I did not have a hundred thousand bucks to invest anywhere. One would hope to receive an inspiration on how to make a million bucks. Maybe not, in this lifetime,

-- Million Bucks (, June 14, 2000.

I just figured it out. I love you guys.

-- Carlos (, June 14, 2000.

Carlos, you're not sampling from the stockroom, are you?? ;^)

-- Brooks (, June 14, 2000.

Moderation questions? read the FAQ