This has been a busy time. A few days ago, I flew up to Calgary, Alberta to appear on a panel to talk about the price of oil. The audience was about 1300 Chartered Financial Analysts. My flight up was uneventful except that the food on Air Canada Rouge was literally inedible. The first class was strange, too. It was just coach with the middle seat roped off. But the seats were still coach-sized.
My seatmate was an incredibly pleasant young athlete, just as kind as he could be. A genuine delight of a young man. I was met at the gate after a blissfully short flight by a rain thin black African man. He was from Congo. He had also lived in Burundi and now he lives in Calgary.
Canada is making mighty efforts to become multi-ethnic. Just what the rationale is here, I do not know. I do know that Calgary has foreign-born men and women manning almost every waiter’s station, reception desk, and snack bar. Is there really a huge labor shortage in Canada? I guess so. I would tell you that I particularly dig the beautiful Asian girls, but then some blue stocking would write to me and complain. So, let’s just say it was all pretty cool and I loved my panel.
No one knows why oil dropped so far so fast. The supply situation — lots of new shale oil coming on stream, for months if not years. The demand situation has not changed at all. Saudi Arabia and OPEC declined to cut production to support a price near $100 a barrel. But they never said they would support the price of oil. And in any event, world oil consumption is so immense that even if the Saudis cut production by a million barrels a day, the cut would mean roughly 1 percent of demand. So, then why did oil — facing small increases in supply and at most a slowing in demand — suddenly fall by about 55 percent?
There is only one answer that I see: the traders make billions on a downward move of that size. They are the only ones capable of affecting the price who make money off a fall. So, it has to be the traders. That’s been my experience with commodities always: when sudden moves occur without real world causes, look to see who benefits. The traders. Not Saudi Arabia. Not Exxon-Mobil. The traders. And at the right time for them, when everyone is saying low oil is here to stay, they’ll float rumors of a shortage and move it up again. They are the butcher with his thumb on the scale.
Always, cherchez les traders.
However, I could be wrong. Figuring out commodities prices is a fool’s game unless you can rig them — and the traders can and do.
I flew home on Friday after a simply great lunch at a café in Calgary called “Earl’s.” Great food and great service. Excellent teriyaki chicken. Beautiful waitresses, but I am not allowed to notice.
Tonight, Alex and I watched Mr. Obama’s SOTU speech. It was great. Give everyone free day care. Who pays for it? Where do they find enough qualified day-care workers? Where do they train them?
Everyone gets free education. Wait. Isn’t public education up through high school already free? And the ones who need it most, the blacks and Hispanics, drop out at terrifying rates. Who will make them stay in school and do their homework? Who pays for this? And where do the teachers come from?
He promises free goodies to the non-rich, and that’s fine, but who will pay for it? Or does he just add to the deficit? I guess he does. I keep thinking, “Panem et circenses” — and free day care. Endless gifts from Uncle Sam’s endless bounty! That’s his program for all of his voters.
Mr. Obama just does not get that many of the people who really need to acquire human capital — blacks and Hispanics — resist acquiring it at any price.
This country has plenty of opportunities. It just does not have enough ambitious, hard-working young people. Hey, maybe that’s what Canada’s immigration policy is all about.… Maybe we should take in ten million Asians.…
My favorite part of the speech, though, was about how he wants to make a kinder, gentler politics in America. He sticks it to the Republicans any chance he gets, attacks the police, mocks law enforcement, and then he gets all hissy when anyone criticizes him. And what’s with him comparing anti-Semitism and discrimination against transgenders? I love transgenders. They are super cool. But when was there a Holocaust against them? The two victim groups have little in common. And what’s with Obama and the Gay Marriage thing? He says the fight is all over. If that’s true, why is he bringing it up? If that’s true, why is the Supreme Court hearing a case about it? I love gay people. Almost everyone I know is gay. But why is Mr. Obama so obsessed with them if their fight is won? And why is he bragging about the U.S. pulling out of Afghanistan? Usually losing a war is not a cause for celebration. Everywhere we look, the terrorists are on the ascendant and civilization is in retreat. So, what is Obama crowing about? Is he really as blind as he acts or is he just stating a preference about the outcome? Why is he unable to use the phrase “Islamist terror”? Does he think the Islamic State likes him if he uses weasel words?
He is just so incredibly sorry as a leader. Bragging about LGBT triumphs as all of Europe trembles at Islamic terror and the whole Middle East except for Israel and Egypt (which he dislikes) falls into chaos. What is wrong with him? He has lost sight of what’s real and what is important. He looks extremely tired. Maybe he isn’t well.
Still, I sure would not want to be him, and have to answer to his constituency. Hard to please, aren’t they, Mister President? To think that civilization rests on a reed such as Barack Obama: terrifying.