Quote:
Originally Posted by tholland
Like all speculative bubbles, this one will eventually pop and prices will came back in line with fundamentals... For now, the oil casino is still open for business.
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I totally agree, but then we're going to have another problem....
That speculation is being driven by hedge funds. The same kind of hedge funds that created the subprime lending bubble. When that bubble popped you saw how many banks nearly folded. Well, the same is going to happen when the oil bubble pops but its only going to be worse.
You see, these hedge funds only supply about 10% of their own cash for speculative buying. The rest is borrowed from banks. When the oil bubble pops and those banks call in the loans,..... well, the excrement is going to hit the fan and WE are going to be left holding the bag..