Bending the Third Rail
Because We Should, We Can, We Do
Tuesday, October 03, 2006
Smoking Tail Pipe UPDATED
Looks like someone [guest blogger at Barry Ritholtz's site] is getting much closer to uncovering real evidence of what most of us intuit .... the fall in gas prices in a manipulation by the White House prior to the election:
Such is the case with the recent plunge in the price paid for gasoline by formerly dour consumers leading up to an election where the party in power is clearly having difficulty wooing the electorate. It just so happens that the newly appointed Treasury Secretary used to run the investment bank that controls the world's most important commodity index, which seven weeks ago cut the weighting of unleaded gasoline by nearly 75 percent, causing all commodity investments based on this index to sell their unleaded gasoline futures.
The writer, Tim Iacono, then goes on to prove his case. Essentially, Goldman took some of it's commodity investment money, $6 BILLION, out of gasoline and put it in other commodities.

Like, quickly.

I won't excerpt the entire post, go read it for yourself. It's pretty convincing. As prices have been falling and without knowing the details of the Goldman Sachs reweighting, it sure looked like some kind of bubble burst or market manipulation. Of course, they'll never be able to prove it, that's how these manipulations work. But you know having Henry Paulson join the Treasury Dept. is looking like a pretty good political move just now.

UPDATE: More on the conspiracy:
Gross explores some plausible theories: "The administration has taken steps recently to remove a marginal, but important, buyer from the marketplace. After having delayed the summer's deposits to the Strategic Petroleum Reserve until the fall, the Wall Street Journal Monday reported that, 'The Energy Department will hold off purchases of oil for the government's emergency reserve through the upcoming winter.'
All just a bunch of electoral "good luck" according to Slate's Daniel Gross.

Right.
Written at 5:38 PM by Greyhair.
1 comments
1 Comments:
Blogger the spook said...
-)
Sept. 25:

http://spookoftheozarks.blogspot.com/2006/09/gas-prices.html
8:55 PM  
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