BUYING CASTLES IN THE SKY
July 29th 2008 00:10
Have you ever read or heard of those solid analyses about how a certain commodity or stock is going to continue to appreciate in price (until the price touches the moon and the stars) due to scarcity of supply and leaping demands? They do sound convincing don’t they? Especially, if you do not have any idea what the analysts are talking about.
The stories woven for the consumption of unsuspecting victims can (sometimes) make you jump off your chair and rummage thru your files to make sure that you have not actually gone to Mars lately and lost touch of what is going on in this earth.
The subjects of these analyses could be anything. Lately, the favorites were gold and oil. Now, I am not going to pretend that I know everything and try to debunk all claims made by the “experts” on why they think the prices of such commodities would shoot all the way up to the next galaxies.
But, I believe, I must warn my fellow newbies not to take everything those analysts are trying to dish out, hook-line-and-sinker - including the fisherman -or they might end up being eaten by the fish (so to speak)!
At the very least, when somebody started saying that they can build castles in the sky, newbies like me should at least remember how a question mark (?) looks like.
I mean, come on, it is really nice to think that making millions or billions in the stock market is just as easy as listening to fairytale stories. But, look at what happened when the price of oil reached $147 USD/ barrel - worries began to seep in - and the commodity that many are betting on to save them from economic disaster threatens be the one to cause an even bigger disaster!
I do remember mentioning somewhere that there are self sustaining prophecies. By that, I mean, dreamed of scenarios that become real simply because they are told or presented to the public. The public saw an opportunity on the scenario (not because they believe it), they bought into it and for a while the scenario becomes real until they decided to cash in on the gains.
What happens then, when you are the last one to come in?
The other side of that is when you decided to buy into the story early… what happens when no one else bought?
A number of experts predicted a while back that the price of oil will reach US$200/ barrel. Hedge funds managers and speculators went for it in droves. The price went all the way up to US$147/barrel – robbing hundreds of thousand of people of their jobs and sending millions of people into starvation in the process...
Then, oil price dropped all the way down to US$124.00. (Of course, there are people who continue to believe that the price of oil is still cheap.)
Somehow, I have this feeling that a never ending rise of the price of oil violates some rules on economics. But then, like I always say, I am not the expert here.
Hell, whatever you do, don’t ever start living in those castles in the sky.
The stories woven for the consumption of unsuspecting victims can (sometimes) make you jump off your chair and rummage thru your files to make sure that you have not actually gone to Mars lately and lost touch of what is going on in this earth.
The subjects of these analyses could be anything. Lately, the favorites were gold and oil. Now, I am not going to pretend that I know everything and try to debunk all claims made by the “experts” on why they think the prices of such commodities would shoot all the way up to the next galaxies.
But, I believe, I must warn my fellow newbies not to take everything those analysts are trying to dish out, hook-line-and-sinker - including the fisherman -or they might end up being eaten by the fish (so to speak)!
At the very least, when somebody started saying that they can build castles in the sky, newbies like me should at least remember how a question mark (?) looks like.
This looks like a better place. Illustration pic, Carbisdale Castle pic source:Wikipedia
I mean, come on, it is really nice to think that making millions or billions in the stock market is just as easy as listening to fairytale stories. But, look at what happened when the price of oil reached $147 USD/ barrel - worries began to seep in - and the commodity that many are betting on to save them from economic disaster threatens be the one to cause an even bigger disaster!
I do remember mentioning somewhere that there are self sustaining prophecies. By that, I mean, dreamed of scenarios that become real simply because they are told or presented to the public. The public saw an opportunity on the scenario (not because they believe it), they bought into it and for a while the scenario becomes real until they decided to cash in on the gains.
What happens then, when you are the last one to come in?
The other side of that is when you decided to buy into the story early… what happens when no one else bought?
A number of experts predicted a while back that the price of oil will reach US$200/ barrel. Hedge funds managers and speculators went for it in droves. The price went all the way up to US$147/barrel – robbing hundreds of thousand of people of their jobs and sending millions of people into starvation in the process...
Then, oil price dropped all the way down to US$124.00. (Of course, there are people who continue to believe that the price of oil is still cheap.)
Somehow, I have this feeling that a never ending rise of the price of oil violates some rules on economics. But then, like I always say, I am not the expert here.
Hell, whatever you do, don’t ever start living in those castles in the sky.
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