All Speculative Bubbles Are Bad

Has Russia Just Pulled Itself Out Of The Petrodollar? The graph above shows a classic speculative bubble.  The futures in the derivatives oil markets which is like the Chicago farm futures market, is prone to speculative bubbles.  When these happen and consumer prices shoot upwards, we have an inevitable crash.  All speculative bubbles pop.  They have done this for the last 400 years.  Each cycle of bubble/collapse leads to vain attempts at preventing bubbles that collapse after while.  That is, people are burned by bubbles and then do it all over again once the memory of the pain fades.  But if governments intervene to prevent speculator pain, they go merrily from one bubble to the next with no hesitation expecting to be bailed out over and over again, faster and faster.

 

Oil Prices Drop, EU Leaders Want End To War On Russia, Texas Reels

Francois Hollande suggests sanctions on Russia should be lifted | Daily Mail Online: Germany is eager to stop the charade, too.  The demonization of Putin and then replacing him with an oligarch who would dismember and sell off Russia, has failed miserably.  Putin is now coping with a global sudden oil futures ‘glut’.  That is, the futures bidders thought Russia would be knocked out of world markets last fall, bid up future prices which now are nosediving, driving many speculators into bankruptcy.