Professor Elam

on If supply meets demand at $100 oil,what happens when demand exceeds supply? Read this article about

Peak Oil.  The Far East will only demand more oil.  As the article suggests, I suspect we won’t be producing more than 100 M barrels a day of the stuff. Here is the link to the article on Peak Oil in widipedia.   In short, production is toping out while demand is accelerating.

Moving right along here is an article on Core Inflation.   Core inflation is inflation, the real problem, sanitized to make you think there is not inflation.  Core inflation might be inflation minus food and energy.  so if you don’t eat, heat or cool, or drive, you do not have inflation.  Srip the insane increase in college tuition out of your budget, along with eating and driving, and whooppee, no inflation. Thi is absurd but also official US Policy. The author points out the same group pushing it here is pushing it on the Chinese. As Jim Rogers says, the Chinese Communists are the world’s best capitalists, I don’t think they will put up with earning less than the rate of inflation much longer.

Here is an explanation of why Commodity Prices fell this past two weeks. Futures traders were forced to liquidate commodity positions to cover financial positions.  More sellers than buyers in futures but not in the physical underlying commodity.  This is whyI have assigned readings on derivatives and options.  The latter article is typicaly academic which is to say nearly impossible to decipher, I will be posting my own version shortly on WEB CT.