http://www.thefreemanonline.org/featured/why-speculators/ Ideas on Liberty Tue, 14 Feb 2012 10:04:48 +0000 hourly 1 http://wordpress.org/?v=3.3 http://www.thefreemanonline.org/featured/why-speculators/comment-page-1/#comment-52400 jimmy Mon, 12 Dec 2011 04:27:45 +0000 http://www.thefreemanonline.org/uncategorized/why-speculators/#comment-52400 ellsworth, all u can say is fail. Read and thing about what you say before you post it ellsworth, all u can say is fail. Read and thing about what you say before you post it

]]> http://www.thefreemanonline.org/featured/why-speculators/comment-page-1/#comment-38836 ellsworth frankson Mon, 17 Jan 2011 17:34:28 +0000 http://www.thefreemanonline.org/uncategorized/why-speculators/#comment-38836 You are not taking into account "bubbles" in prices for commodies. Bubbles have nothing to do with supply and demand. They are purely speculative. When miners of gold can mine gold, process it, and make a reasonable profit at $300 to $400 an ounce, yet speculators drive up the price to almost $1,500 an ounce in some preceived hedge against inflation, the inflated difference is all bubble. In all bubble situations, sooner or later investors come to the collective opinion that the commody is over-priced (example: the tech stock bubble and the housing bubble), or more money is to be made in a different area. When this happens the bubble bursts and prices rapidly fall and those speculators slow to react take a financial beating. It's the old story, "It's easy to know when to get into a market, but it takes genius to know when to get out." Meanwhile, society suffers do to the high inflated prices. An example is two years ago when oil rose to $147 per barrel and gas prices skyrocketed. Congress threatened to investigate the speculators and immediately the speculators chickened out and the oil and gas prices fell. Market specialists who truly speculate from knowledge is one thing, those who merely buy and sell on a wager bring no benefit to the market. In fact their antics often put an unnecessary financial burden on society through higher prices. You are not taking into account “bubbles” in prices for commodies. Bubbles have nothing to do with supply and demand. They are purely speculative. When miners of gold can mine gold, process it, and make a reasonable profit at $300 to $400 an ounce, yet speculators drive up the price to almost $1,500 an ounce in some preceived hedge against inflation, the inflated difference is all bubble. In all bubble situations, sooner or later investors come to the collective opinion that the commody is over-priced (example: the tech stock bubble and the housing bubble), or more money is to be made in a different area. When this happens the bubble bursts and prices rapidly fall and those speculators slow to react take a financial beating. It’s the old story, “It’s easy to know when to get into a market, but it takes genius to know when to get out.” Meanwhile, society suffers do to the high inflated prices.
An example is two years ago when oil rose to $147 per barrel and gas prices skyrocketed. Congress threatened to investigate the speculators and immediately the speculators chickened out and the oil and gas prices fell. Market specialists who truly speculate from knowledge is one thing, those who merely buy and sell on a wager bring no benefit to the market. In fact their antics often put an unnecessary financial burden on society through higher prices.

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