It's Still All About Oil

This article has 4 comments:

•  
  Eric Fox

  Jul 03 07:12 AM

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  I would like to see a chart like this extended back 5-10 years.
•  
  BrucePile

  Jul 03 06:51 PM
  A lot of other investments correlate strongly with oil. A really good area of investment now are the things that follow the big moves in oil but haven't moved nearly as much yet. Such things are natural gas, oil service and E&P stocks, gold, silver, and sugar. Sugar? What does that have to do with oil? About 60 % of the world's ethanol is made from sugar. America is the only country stupid enough to make it out of corn. Before the age of ethanol, there was no correlation between oil and sugar, but now the R factor has grown to about 85. Right now, sugar is at historic lows and is probably lagging oil more severely than anything that follows the price of oil. But the price of sugar has been showing signs of life lately. This is one of the reasons Jim Rogers told investors at a global conference in Japan recently, "You all should buy all the sugar you can".
  
  Of course, it's very dangerous buying any one commodity. But a reasonably safe way of buying sugar is with it equally packaged with 3 other food crops - say wheat, corn, and soybeans. All these other 3 are in high demand as food and 2 of the 3 are also fuel crops! Do they make such an investment vehicle? Yes, it's called DBA, an exchange traded fund. And there's even a 2X version called DAG that moves twice as much as the commodity prices.
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  jjason

  Jul 04 04:56 AM
  You jerks are just driving up the cost of everything and it will result in a lower standard of living for the average American.
  
  Commodity traders are cheating us. OPEC is cheating us too.
  
  Hopefully Congress will change the laws and commodity traders will have to put up more margin ( like 50%) and take delivery of the commodity ( instead of rolling over the contract ).
  
  If it puts speculators out of business then prices will drop.
•  
  galewhitaker

  Jul 05 10:14 PM

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  jason - You are dead wrong. Oil is a declining resource and the price will go up for the rest of time. It will continue to go up no matter what they do to the speculators.