Thursday, May 22, 2008

So who has the cajones to short oil?

Watching CNBC and Bloomberg TV, most traders and money managers think that oil prices are fueled by speculation and not fundamentals, but they are all afraid to short it.

I am watching the CNBC oil crisis special right now, and it is just ridiculous. When the feeling that oil will remain high forever, and that we have to learn to adjust to it sets off red flags, when everyone says that it isn't reflected into fundamentals.

Bubbles are Ponzi schemes and are unsustainable in the long run, so its inevitable that it will come down. The crazy thing is that no one is expecting it to come down because they expect it to rise up more in the short run. They are afraid to fight the trend, and they are probably justified in that to some extent.

The problem is that everyone is expecting it to go up. When everyone expects something will go up and inevitable, its probably means the end is near, but who knows? I am not an expert on this, and this could create a self fulfilling prophecy.

Whatever, talk is cheap so. The problem is that TD Ameritrade won't let me open a margin account (That's what you get for being unemployed with an ugly looking portfolio), so I can't short and I don't know how to get into commodities without ETFs (which are the reason we are in this mess). So I have to resort to shorting with my valuable reputation.

I am calling the oil top right about NOW: meaningless non-ballsy paper shorting oil at 130.69 with a completely useless stop at 134.

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