July 5, 2009
Next time when someone claims that the oil market (or the stock market) cannot be manipulated – a favorite excuse often used by the SEC officials to justify them removing investor protections rules (as Uptick Rule) and pleasing Wall Street lobbyists – you know that the individual is either a fool or a corrupt government official. (Major oil companies are heavily weighted in the Dow and SP 500, it is not hard to see how by manipulating oil prices, one can manipulate the stock market)
On Tuesday, a broker placed a massive bet driving oil prices to $73.50
On Thursday, the firm was liquidating the bet and driving oil prices down 10% to $66.50
"This was the second episode of rogue trading in the oil market this year. In May, an oil trader at Morgan Stanley was banned by the City watchdog after he hid from his bosses potential losses on trades made under the influence of alcohol."
I hope everyone has enjoyed paying high gasoline prices and the recession that followed the spike last year, while the SEC is either sleeping at the wheel or promoting stock market and oil gambling casinos in a name of greater liquidity.