PowerSwitch

Perhaps the Mayans were right after all.

The Guardian - 21/12/12

Fiscal cliff fears hit US stock markets and oil prices

Fears that the US would fall over its looming fiscal cliff sent stock markets reeling and oil prices dropping on Friday as investors feared the political deadlock in Washington would drag down global growth.

With House members having left Washington on Thursday night for Christmas and Senate members scheduled to leave on Friday afternoon, the prospect of a deal before the 1 January deadline appeared bleak.

Article continues ...

Merry Christmas folks!

But the oil price closed higher today than it has for several weeks!

biffvernon wrote:But the oil price closed higher today than it has for several weeks!

I assume this is a measure of market optimism regarding BAU?

No, just the workings of a chaotic market. But it does make journalists look silly when they try to explain small market movements which don't actually have any explanation.

I would think that the market can not be [ugh why does control+I not create italics] totally chaotic for that would mean that profitability would be totally unpredictable and some people are apparently making money from the markets.

What in fact dictates the price of oil? Supply + demand + expectations? Complicated stuff!

I'm sure that the combined minds of Powerswitch minus the group think and associated herd behaviour could really make a killing analyz/sing the oil markets. Or not? It's difficult to say. What is in store for us, society, industrial civilis/zation? What I'm most concerned about is how to make money from the coming collapse!

It's not just supply + demand + expectations. It's the big speculators who have the historical clout to force prices down or up. Which is why the market is so chaotic: they can make money when prices go up AND down. No small fry can beat the big fish longer term.

I think making money from collapse is the wrong way to think about things - rather, make a living from it might be better.

Unless you already have a pile of money: buy land for savings and properties to let out. I think that's immoral but I have no money, so maybe a little biased!

Atman wrote:I would think that the market can not be [ugh why does control+I not create italics] totally chaotic for that would mean that profitability would be totally unpredictable and some people are apparently making money from the markets.

The thing about chaotic systems is that they can be bounded, operating between limits.

Thus, our weather is chaotic in that we cannot forecast whether it will rain on Lincolnshire in 20 days time (and we never will no matter how big our computers) but we will always be able to say that January will be cooler than July. So with oil prices, we cannot predict tomorrow's spot price and a small fluctuation cannot be definitely ascribed to a particular event. Yet we might be tempted to take a punt on the price in five years time. (I wouldn't.)

Atman wrote:I'm sure that the combined minds of Powerswitch minus the group think and associated herd behaviour could really make a killing analyz/sing the oil markets. Or not?

Not. It's been tried, at least by some closely associated with PowerSwitch, and fingers have been burned. The difficulty is the black swan events such as Lehman Brothers, 2008 and all that. Get the timing a little bit wrong and you're history.

at least by some closely associated with PowerSwitch

That's interesting.

biffvernon wrote:
The thing about chaotic systems is that they can be bounded, operating between limits.

True, but if I remember correctly, that assumption was what did for "Long erm Capital Management" when the USSR collapsed.

Higher taxes for more revenue. Less spending. In a growing economy. I don't understand what all the fuss is about. Getting started on this path now means it will be more difficult to turn into a Greece situation later.

RenewableCandy wrote:

biffvernon wrote:
The thing about chaotic systems is that they can be bounded, operating between limits.

True, but if I remember correctly, that assumption was what did for "Long Term Capital Management" when the USSR collapsed.

Bounding limits aren't solid. There are outliers whose frequency diminishes with distance out.

Yes, they forgot that bit