Oil Company Legislation
Jul 3rd, 2008 | By David Galland | Category: Oil Investment & Alternative EnergyIn other words, it declares legal open season on every layer of the energy distribution network. That, of course, means millions of dollars of legal fees, wasted time and, worst of all, more hand-tying regulation…the net result of which will be fewer, not more, energy resources being made available to North American markets.
Do I have a problem with the large energy companies making “obscene” profits?
Not at all. They are going to need all the money they can muster to replace their declining reserves and to fight off fierce competitors from the rest of the world. Competitors, it must be pointed out, unhindered by the perfect-worlders and political panderers that are now playing so effectively to democracy’s weak suit.
Twenty years ago, which was seven years after the link between the U.S. dollar and gold was severed in 1971, oil was selling, on average, for $13.38 per barrel. Adjusting for inflation — using the Shadow Stats and not the government’s laughable CPI — in today’s dollars that same barrel of oil would cost $124.
That it is trading for slightly over that amount, at $143 per barrel, is entirely explainable based on supply/demand constraints, war in the Middle East and the fear of a widening conflict.
In other words, blaming evil-eyed Middle Eastern potentates or bloodless speculators is attributing blame in the wrong direction. If you want to hit the right target, start with the fiat currency system which has systematically reduced the purchasing power of the U.S. dollar and all of its similarly unbacked peers to the level of Monopoly money.
Unfortunately, I don’t see any new legislation on the horizon calling the Fed and the Treasury to account for their role in the higher prices now getting so much attention.
Regards,
David Galland,
Casey Research
Source: Oil Company Legislation
Pages: 1 2
Advertisement
As a company, EverBank® is committed to your global portfolio success. That's why we match our innovative product line with the insightful research tools you need to make informed foreign currency decisions.
Take advantage of our expertise with free resources like Chuck Butler's Daily Pfennig, the new Foreign Currency and Global Market Resource Pages of EverBank.com and a Trade Desk that's staffed with currency experts who are eager to help you.
Pages: 1 2