January 10, 2013

The 4-Week Manipulated Move in Oil Prices is Criminal

By EconMatters


No Fundamental Reason for Oil to Move Higher

When is this country going to say enough is enough and start putting people in jail for this kind of blatant market manipulation? It is obvious that the Oil market is manipulated, oil has gone nowhere for five months because there is no reason for it to go anywhere, i.e., there are a ton of supplies on the market, no Middle East disruptions, Israel hasn`t attacked Iran, huge builds in gasoline products, no jump in demand.




And yet Oil mysteriously rises $10 in this common period for manipulating markets at the tail end of the year, and the beginning of the new year, let`s juice it up before the contract rollover, no one cares, no one is really looking too closely at what we are doing, everybody is focusing on fiscal cliff issues and the debt ceiling debate.

Another Bearish EIA Report

So we have another bearish inventory report on Wednesday, and oil refuses to go down, why so they can force it one leg higher, and get other trapped traders to buy their contracts from them so they don`t have to rollover at a huge cost.

Force Stops & Reduce Rollover Exit Costs

This is why when nobody takes physical delivery prices do not go down an equal amount on rollover, as less than .005% take physical delivery, this way prices aren`t negatively affected after a large amount of money comes into a futures contract in an equally large rollover effect on exiting.

It is because the side which has pumped the futures contract with a bunch of cash, makes the other side who rationally would be short based upon the normal price history and abundance of supplies, has to cover thus buying the contracts from the pumpers in this case, thus avoiding a large rollover effect when they have to exit because the contract ends after a month.

There is a whole art to the manipulating game in the oil market, and the big banks play it quite well. And given how inept congress who has investigated them twice in the last five years every time prices run up and has done nothing, the big banks think they are invulnerable on this issue.

If you haven`t clamped down on us yet, and you cannot even get you own house in order, then there is no way you can figure out how we are manipulating the oil markets.

Trading Records Last 4 Weeks

But enough is enough, this is blatant criminal behavior, and it is pretty easy to know who the culprits are just pull the last 4 weeks trading records and see who bought large positions the last 4 weeks, while the fundamentals never materially changed in fact they got more bearish as the products` supplies grew at a substantial rate, and there were no Middle East supply disruptions, or strategic hot spots that were in danger of having supply disruptions, nada.

“Asset Class” Euphemism for Roulette Table

Prices are not determined by the fundamentals in a manipulated market they are determined by oil being an “Asset Class” which is code word or a euphemism for giant Casino in New York instead of Vegas.

So we cannot legally play poker online in this country, but you can pull up your internet connection, and place your wager on the price of oil, such hipocracy in this country.  The price of oil, and as such gas is determined not by supply and demand factors, but by whether Goldman Sachs or Morgan Stanley or J.P. Morgan puts $400 million on Black or Red, the literal Oil Roulette game of the big banks.

If Goldman Sachs puts $400 million on Black prices go up, if they put $400 million on Red prices go down, as simple as that, this is actually how the price of oil is determined, nothing more and nothing less.

Market Correlation & Wagering Strategy

Furthermore, Goldman Sachs or Morgan Stanley doesn`t factor in how this aligns with the fundamentals of the market, they don`t care, they more care about how putting $400 million on Red will affect their other manipulated market the equities market, as the equities market has a lot of oil and gas components in it.

Thus they do think somewhat strategically, i.e., they try to align their betting strategies, so when we put $400 million on Red, let`s pick a time when we are going to sell off the S&P 500 as well. This is why markets are so correlated even when one is a commodity that consumers put in their car, and has supply and demand issues, where the other is purely an investment vehicle.

Betting Reports & Market Collusion

So Mr. Consumer the next time gas prices go up, and they will for the next month as retail prices catch up to the manipulated move in the futures market, just realize that Morgan Stanley decided to put it on Black this past month, and when your prices go down, praise the alter of J.P. Morgan as they decided to go Red that particular month.

And it is always coordinated; you never have the big banks putting on Black and Red, thus trading/wagering against each other. They will all come out with their Betting Reports, I mean Research Reports designating the myriad of market conditions as to why they decided to put the cash on Black versus Red this month.

CFTC: These small fines are a joke!

The real reason for market selloffs in Oil is usually due to the occurrence that the big banks are going to sell off equities in the summer, late April anyway, so they start selling off oil as well, i.e., $400 million on Red! Such a scam, such a rigged market, this is getting so old…..where are the regulators?

I don`t want congress to have more hearings on the subject, I want the governmental organizations who are tasked with monitoring this bullshit to start investigating, and shutting trading shops down for this crap!

EIA Reports: Why bother?

Why even continue this farce of having EIA reports anymore, they are completely irrelevant to the price of oil, and oil continuously goes the opposite way of the reports, why even bother with this government agency, it is not like the history of the market the last five years tracks the fundamentals of supply and demand.



Government Agencies & Regulators at their finest

Let`s just save some more tax money and shut down the agency, at least consumers will only be getting screwed by wall street traders. And while we are at it lets just abolish the SEC and the CFTC, as they are completely useless. Furthermore, since all markets are ripe with manipulation, essentially the wild-west; why not reduce government costs by cutting funds to these two agencies entirely.

They serve no real purpose when markets are corrupted everyday with Fake Orders, Dark Trading Pools, High Frequency Trading Algos, and the like except to further government costs & bureaucracy while strictly providing the illusion of fair markets. These organizations are a complete joke, and have been for decades!

The Cheating isn`t even hidden anymore

Literally the CFTC only has to pull up a trading Dom watch it for five minutes and watch all the flashing fake large orders that appear and disappear as price reacts to their presence to know that these markets are infested with manipulation termites. They obviously purposely look the other way, or avoid looking at all!

OPEC points to a Manipulated Market

Americans have it all wrong, you are not being held hostage by the middle east, or the cartels like OPEC, it is the Big Banks Cartel, let`s call them the Roulette Cartel that is holding the American and World consumer hostage, and this crap needs to stop.

Even OPEC realizes this manipulation, and they have publicly stated many times it is the speculators that are determining the price of oil. But they use too kind of a word, because these are just a bunch of Vegas style Roulette players with deep pockets who unlike Roulette have no risk because while there is randomness with a slight edge to the casino in Las Vegas, the Oil Roulette table of the Wall street banks never have a losing quarter, shoot they very rarely have a losing day, and it is hard to ever lose when you’re the ones moving the market.

Wall Street Mansions don`t build themselves

Consumers realize when they gamble in Las Vegas that those casinos are not built by them winning, but they probably don`t realize to the extent that those Hampton and Connecticut mansions are being built through the sacrifices of consumers at the pump.

Yes, there have been 30 million barrels added to gasoline supplies over the past 6 weeks, but you are charged 30 cents higher in the futures market, and these prices will be coming to a neighborhood near you.


Are You Kidding Me?

So let me get this straight, the gasoline market went from a tight, to a well-supplied market in six weeks, and consumers are going to be punished 30 cents more for this ridiculous build in more supplies? All these gasoline supplies are building in storage because there is not enough consumer demand for the product, and prices are going substantially higher not lower?

This is the exact opposite of how efficient markets are supposed to work in a non-rigged market, this very fact, should be a wake-up call for regulators. Hello CFTC, what is going on in the gasoline RBOB market? Do you think you should start investigating, you do exist for a reason, there is a blatant, clear cut case of price manipulation in the RBOB gasoline market, now get to work and do your job!

© EconMatters All Rights Reserved | Facebook | Twitter | Post Alert | Kindle

Advertisement