Re: Larry Kudlow [Ramesh Ponnuru]
Tuesday, July 01, 2008
Saudi Arabia's King Abdullah told oil consumers Tuesday that they should get used to high prices and not blame the country for the spike in the price of crude, the Agence France-Presse news agency reported."Consumer countries have to adapt to the prices and the mechanisms of the market," the king said in an interview published Tuesday in Kuwaiti daily Al-Siyassah.
Abdullah's comments came as the price of oil jumped past $143 a barrel for the first time.
The king contends that speculators are to blame for the rising costs, a claim that has been denied by the International Energy Agency, AFP reported.
"Often it is a case of political expediency to find a scapegoat for higher prices rather than undertake serious analysis or perhaps confront difficult decisions," the IEA told AFP.
OK, here's Econ 101.
Oil prices are NOT being driven up by speculators. Oil prices are high for one reason: OPEC. OPEC is a cartel. In the USA, cartels are illegal (well, except for MLB and the NFL and...) So when traders on the exchanges bid on oil, there is one major supplier with the same price. OPEC sets prices for ALL of its members, and sets production quotas for members. Together, OPEC members produce about 40% of the world's oil supply. This means that, if I agree to pay $130 for a barrel of oil, all OPEC members sell at this price. I can't get a separate bid from Saudi Arabia, Iran, Iraq, Venezuela, etc. In the past, some of the OPEC members would "cheat" on their production quotas, but they were punished by other OPEC members.
If there was truly a free market in oil, I could go to the market and get a price from all of the different nations that produce oil. If the current price was $130, I could probably find someone who would offer it at $129. That, in turn, would start a bidding war (downward), resulting in a lower price. The price would stabilize when the last barrel of oil available was sold to the last bidder. This usually results in a price that reflects costs + a reasonable profit margin.
Today, if I offer $129 for oil that's selling at $130, none of the OPEC countries are allowed to sell to me at $129. Since they control such a high percentage of oil output, those suppliers that are not members of OPEC have no incentive to sell at any price lower than the "set" price, or OPEC price. They'll get the OPEC price.
To call this "an open market", "a free market'', or "the mechanisms of the market" is a bunch of baloney.
Solution: We should tell all OPEC countries that we will bomb the next OPEC meeting, killing all oil ministers. We will then assassinate all future oil ministers and bomb OPEC meetings until they dissolve OPEC. You think I'm kidding? Well-placed smart-bombs in the camel tents of a few Saudi and Iranian goat-lovers would cause them to get our religion quickly. I'm deadly serious. These SOB's hide behind statements like the one above, taking billions from us, and then tell us it's our fault. I've had enough of this garbage.
The price to drill and recover oil in the middle east is somewhere less than $20/barrel. I would pay $40/bbl for this oil. They'd still be zillionaires, but we would be a lot better off.
Oh, by the way, lest you think I'm kidding, my REAL proposal is to nuke the mideast, take it over, and sell it to the highest bidder (Exxon and Shell would pay reasonable prices for oil leases there). As my brother would say, "What are all of those arabs doing camped out above our oil?"
I remember, when living for four years in Indonesia as a child, I listened to my mother reading me the first lines of the Declaration of Independence, "We hold these truths to be self-evident, that all men are created equal, that they're endowed by their creator with certain unalienable rights, that among these are life, liberty and the pursuit of happiness."
John takes a great shot:
I would have thought that pretty much everyone--certainly every Presidential speechwriter, and every Harvard Law School graduate!--knows that these are not the "first lines" of the Declaration, which begins, "When in the course of human events...." What, exactly, accounts for the fact that Obama is not a laughingstock?
Good ole Mrs. Upchurch in 6th grade would have flunked me if I made that kind of stupid mistake. Click the link below and read the rest of the stupidity that is Obama.
H/T Power Line
Pray for Tony Snow [Kathryn Jean Lopez]
We are living in an America that, in the last seven and a half years, has waged an unnecessary war, established prison camps, condoned torture, employed corporate armies, eliminated the right of habeas corpus, practiced extraordinary rendition, and believe me, this is only a partial list.Why do aging screen stars think we give a crap about what they think? And what restaurant do they eat at to get the magic mushrooms? Here's hoping her silicon doesn't shift any farther.
Can Somebody Explain to Me ... [Andy McCarthy]
... how Obama sat in Wright's church for 20 years and managed never to hear anything, but hears 20 seconds of a Bush speech that doesn't mention him and perceives a shameful personal attack?
Andy, what's the penalty for perjury?
Sometimes I think the best thing about Barack Obama is that little empty space on his lapel. It is where other politicians wear the American flag pin, a kitschy piece of empty symbolism that tells you nothing about that particular person except that he or she thinks like everyone else. Obama's flag, invisible to the naked eye, is the Jolly Roger of a politician thinking for himself.
Here's the link to the full article.
The Grammy-winning singer-songwriter tells Blender magazine: "'Gangsta rap' was a ploy to convince black people to kill each other. 'Gangsta rap' didn't exist."
So if "gangsta rap" was invented by the government so that blacks would kill each other, then Country Music was invented to get girls pregnant to create more white people.Comparing Labor Market Data in 1996 and 2008
Democrats on the Economy in 1996:
“Our economy is the healthiest it has been in three decades.” (President Bill Clinton, State of the Union Address, January 23, 1996)
Democrats on the Economy in 2008:
“The bottom line is that this administration is the owner of the worst jobs record since Herbert Hoover." (Senator Charles Schumer, Press Release, March 7, 2008)
| Key Labor Market Statistics in 1996 and 2008 | ||
| March 1996 | March 2008 | |
| 1. U.S. Unemployment Rate | 5.5% | 5.1% |
| 2. Number of Long-Term Unemployed | 1.33 million | 1.28 million |
| 3. Average Weeks Unemployed | 17.3 weeks | 16.2 weeks |
| 4. Median Weeks Unemployed | 8.3 weeks | 8.1 weeks |
| 5. Not in Labor Force because discouraged over job prospects | 451,000 | 401,000 |
| 6. Democrats calling for Extended Unemployment Benefits? | No | Yes |
| 7. President’s Party Affiliation | Democrat | Republican |
