interesting post I just read. I don't know if I would exactly agree with it but there are elements of truth to it for sure.
everyone knows the beltway is full of crooks, but Wall Street has slipped under the radar. These guys aren't elected and are not known for their scrupleshere it is:
Goldman and Morgan are LONG OIL, SHORT FINANCIALS.
meaning they invest in oil and are ivested in the failure of financials
They know that if oil goes higher, financials get hurt. They are using the massive profits of this trade to cover their losses on mortgages......and this is also why OPEC invited ONLY these two investment banks to the meeting on the 22nd a few days ago. Why not the other investment banks? It's because the other investment banks didn't get in on that trade. Congress already proved in their hearings that Goldman and Morgan are manipulating the price of oil and other commodities.
Interestingly, Morgan used to have a $150 price target on oil for the end of 2008. When Congress finished those hearings and announced legislation was forthcoming soon, Morgan moved their timetable for the $150 price target up to July 4th.....figuring Congress would not get legislation out prior to then. On the EXACT same day, Goldman's Tel Aviv office somehow got an Israeli cabinet member to suggest that "war with Iran is Inevitable". On a day that oil was already hitting record highs, and record increases, how irreponsible is a statement like that?? I can't picture ANY government official saying such a thing unless they were TRYING to drive oil higher. The timing of it could not have been worse!
"seemingly convienient" stuff like this are a hallmark of conspiracy theorists, but these guys are literally profiting from their own pronouncements
Every time oil drops, either Goldman or Morgan speak out and suggest it goes much higher. And if they don't do it, T Boone Pickens does it for them (he is long oil and other energy related issues). Let's also not forget the myriad of interests the Bush Admin has in oil....hence the energy secretary's comments.
Meanwhile, you have OPEC saying that oil supplies have been adequate and that the price should be about $65 per barrel. You have the International Energy Agency (IEA) showing data that oil demand (worldwide, in barrels) has fallen for 5 straight months.
At the same time, these 2 investment banks are blasting away at financials....especially the bigger ones. Look for Morgan to downgrade B of A tomorrow! Notice how B of A has done a major selloff recently.....as Morgan & Goldman short it! Furthermore, they are using MASSIVE leverage in these trades. They don't follow the trend. They make the trend.
Who was behind the tech bubble? Merrill Lynch, Goldman, Morgan, Bear Sterns, Lehman, etc.. Who was behind the Housing bubble? Merrill Lynch, Bear Sterns, Goldman, Morgan, Lehman, etc. Guess who is behind the oil bubble? Like the other bubbles, everyone is debating whether we are really in one or not! There is no question we are!
Oil is up 50% in 6 months. Are there 50% more cars on the road? Oil usage is down according to the IEA. Are there 50% more power plants consuming the stuff?
If you want the culprits, point the finger (the middle finger if you prefer) directly at Goldman and Morgan leveraging up pension and endowment money to start this momentum on both sides of the trade.
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