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Originally Posted by wob
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What is missing from the articles though is the "fear" part.
For instance the onion piece, imagine if the price of onions were completely driven by rumor and speculation about the market rather than supply and demand. If a big storm knocks out half the crop, there goes half the supply.
With oil it is different. Some thugs in Nigeria hold up a tiny fraction of the world's production and the price rises a couple of percent whereas when the pipeline of BP's in Alaska went caput with a similar volume of production effected you didn't see a price jump. Supply effected similarly but with different effects on price.
It is hundreds of little stories like this which make me think that there is more than supply-demand and a lousy dollar at work here.
I just can't see how pumping so much additional money into a market doesn't cause the price to go up, much like the housing bubble.