Another set of dumb ideas

Original Post: September 25, 2008

Presidential pronouncements not withstanding, when one analyzes the primary effect of the Bush administrations cumulative actions over eight years, it appears to have something to do with elevating the price of oil. At some point an analyst must step back and ask himself whether the primary cumulative effect of an organization’s actions are just a co-incidence, or if those results were indeed the primary goal. We usually look at the set of discrete activities so as to determine how each of them has effected a problem. In this case this analyst strongly suspects the elevated price of oil was and is their primary goal – perhaps their only real goal.

Wonder how Hillary plans to make sure the oil companies do not pass the “windfall” profits tax back to consumers. Do the math Hill! Lets simulate this: You drop the $0.18 gas tax. The oil companies raise the price to what the market will bear – were it was before the tax was removed. You tax them for making too much profit, so they pass the tax on to the rest of us after doubling it to it’s “retail” values. This is NOTHING more than a gimmick.

If you want to lower the price of oil, the funds rate needs to go UP a quarter point, and then raise the margin on commodities trading to 20%. It’s simply nuts to let a guy with $5000 control $100,000 worth of oil.

We are obviously shrinking back to a value added economy, and speculators add no value to anything. For that matter neither do politicians.


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