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Search: Posts Made By: Fat Tails
Forum: Commodities September 25th, 2011, 06:26 AM
Replies: 99
Views: 27,374
Posted By Fat Tails
crosscreek: Thank you for posting this example! ...

crosscreek: Thank you for posting this example!

The situation in Cushing is indeed absolutely insane.

The most important feature of any futures contract is the link to the physical market. This...
Forum: Commodities September 12th, 2011, 06:11 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
Historically, Brent has traded at a small...

Historically, Brent has traded at a small discount to WTI. Starting from the end of 2010 it trades at a huge premium. This suggests that physical arbitrage is only possible one way.

The main...
Forum: Commodities September 12th, 2011, 02:15 AM
Replies: 99
Views: 27,374
Posted By Fat Tails
The pricing of physical Crude typically depends...

The pricing of physical Crude typically depends on the quality which is traded (Russian Export Blend is cheaper than Brent, as it contains more sulphur) and on the location. You have to differentiate...
Forum: Commodities September 11th, 2011, 06:01 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
You are really dreaming, are you? I am going...

You are really dreaming, are you? I am going easy, but there are few posts in this
forum, which are more offending. That said you cannot offend me by insulting me,
but you can easily offend me by...
Forum: Commodities May 6th, 2011, 02:57 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
"Many forms of Government have been tried, and...

"Many forms of Government have been tried, and will be tried in this world of sin and woe. No one pretends that democracy is perfect or all-wise.

Indeed, it has been said that democracy is the...
Forum: Commodities May 6th, 2011, 04:02 AM
Replies: 99
Views: 27,374
Posted By Fat Tails
I think here is a misunderstanding. Cooperative...

I think here is a misunderstanding. Cooperative strategies are not restrictive. Cooperative strategies will evolve by themselves, because those who follow them will gain an advantage over those who...
Forum: Commodities May 5th, 2011, 04:43 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
The answer lies within game theory. Let me try to...

The answer lies within game theory. Let me try to explain.

You need a heavy vehicle, because in case of an accident, the passengers of the light vehicle will suffer from a greater decelaration...
Forum: Commodities May 5th, 2011, 04:12 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
Speculators do not have a good or bad side. But...

Speculators do not have a good or bad side. But when the party is over they all rush to the exit at the same time. This is what is called a crowded trade. :sarcastic:

As you said before, we need...
Forum: Commodities April 22nd, 2011, 04:27 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
The speculators are vultures. Vultures feed on...

The speculators are vultures. Vultures feed on carrion. The carrion is the US monetary policy.

http://www.futuresmag.com/News/2011/4/Pages/Defending-oil-speculators-to-the-president.aspx
Forum: Commodities April 22nd, 2011, 03:57 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
Yeah, I remember that intervention from the Bank...

Yeah, I remember that intervention from the Bank of England, and the other one from the Thai Central Bank, or whatever it is called.



But what caused the oil price to rise?



I am not sure...
Forum: Commodities April 22nd, 2011, 03:21 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
If the US government starts shorting crude this...

If the US government starts shorting crude this will increase the exposure of the US to crude price fluctuation. When crude prices rise this will have a negative impact on the US trade balance and -...
Forum: Commodities April 8th, 2011, 12:28 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
Maybe, but those intraday speculators close out...

Maybe, but those intraday speculators close out their long and short positions every day, so unlike long only index funds they are not causing any trouble, as they do not hold large positions, which...
Forum: Commodities April 8th, 2011, 09:45 AM
Replies: 99
Views: 27,374
Posted By Fat Tails
The so called speculators are mainly long only...

The so called speculators are mainly long only index fonds, as your own contribution clearly showed. Please notice that behind those funds are individual investors. For these it makes absolutely...
Forum: Commodities April 8th, 2011, 06:05 AM
Replies: 99
Views: 27,374
Posted By Fat Tails
It is not the speculators, but stupid contract...

It is not the speculators, but stupid contract specifications

Yes, we need the speculators for a healthy market. This is quite a different problem, which can be tracked to a technical error. This...
Forum: Commodities March 27th, 2011, 06:16 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
This car exists, has been developped by Tata. ...

This car exists, has been developped by Tata.

World's First Air-Powered Car: Zero Emissions by Next Summer - Popular Mechanics (http://www.popularmechanics.com/cars/news/preview-concept/4217016)...
Forum: Commodities March 27th, 2011, 05:23 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
That compressed air car is an old concept. The...

That compressed air car is an old concept. The question is really how much energy you can store in a pressurized bottle of air. Maybe it will be enough to drive to the next shop and back, but it is...
Forum: Commodities March 22nd, 2011, 03:42 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
Trading futures and soccer are both zero sum...

Trading futures and soccer are both zero sum games, one party wins, the other loses.

However, only speculators participate in soccer, as there is no need for hedging exposure. That is one of the...
Forum: Commodities March 22nd, 2011, 01:50 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
Who is the speculator? The fund A holds...

Who is the speculator?

The fund A holds treasury securities and sells a naked put, while the fund B holds a stock and sells a covered call. If I follow your argument, A is a speculator and B is...
Forum: Commodities March 22nd, 2011, 12:57 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
Only Speculators Sell Options

Imagine my name is United Airlines and that I want to secure my fuel supplies. I know it is a bad example, because they will mostly hedge with gasoil futures and some gasoline futures to reduce the...
Forum: Commodities March 22nd, 2011, 06:10 AM
Replies: 99
Views: 27,374
Posted By Fat Tails
Hedgers Need Speculators

If you want to hedge your risk, you need a counterparty. It is not obvious that such a counterparty exists, who is willing to take on your risk. A counterparty only exists if the market is...
Forum: Commodities March 20th, 2011, 06:24 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
Failed Policies not Gamed Prices

Interesting source. Peak oil is reality. Oil prices need to be high to justify investment into alternative energy supplies. A few years ago, when crude was hovering around $ 10 / bbl, none of the...
Forum: Commodities March 20th, 2011, 05:47 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
"There are starving children because gamers drive...

"There are starving children because gamers drive up food prices, the global economy will once again slipping into recession because the same gamers play on the oil market."



I agree, this is...
Forum: Commodities March 20th, 2011, 01:47 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
Food prices are more heavily manipulated than...

Food prices are more heavily manipulated than prices of any other commodities. Just try to figure out which part of the US and European (!) budgets are dedicated to subsidizing farmers.

48% of the...
Forum: Commodities March 20th, 2011, 01:36 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
The crude oil market is difficult to manipulate,...

The crude oil market is difficult to manipulate, there are too many actors. Also it is not always the interest of these actors to maximize their revenues in the short term. Some producing countries...
Forum: Commodities March 20th, 2011, 12:54 PM
Replies: 99
Views: 27,374
Posted By Fat Tails
Absolutely. Influential members of Opec, the...

Absolutely.

Influential members of Opec, the oil cartel, are joining Saudi Arabia in raising output to cool soaring prices and allay fears of a supply crunch in the west, writes the FT. The...
Showing results 1 to 25 of 28

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