Oil's Endless Bid: Taming the Unreliable Price of Oil to Secure The Economy - Hardcover

Dicker, Dan

Hardcover

ISBN 10: 0470915625 ISBN 13: 9780470915622

Publisher: John Wiley & Sons Inc, 2011

Synopsis

Expert analysis of rising oil prices and the out-of-control oil markets that jeopardize both national security and the economy

The price of oil is negatively impacting both companies and consumers. In Oil's Endless Bid: Taming the Unreliable Price of Energy to Secure Our Economy, energy analyst Dan Dicker recalls his experiences as an oil trader and reveals the changes that have taken place in the oil markets during the past twenty years, and particularly the last five, as investment banks, energy hedge funds, and managed futures funds have come to dominate energy trading and wreak havoc on prices.

• Reveals why oil prices cannot stabilize without dramatic action on the part of both government and business
• Details how the novel, but wrong, idea of oil as an asset class took a sleepy, club-like market into the national spotlight
• Describes how the United States is unnecessarily handing its wealth over to foreign oil producers during a time when the potential supply of oil is greater than ever

Written by an industry insider, Oil's Endless Bid analyzes the biggest financial story of the last ten years?how we lost control of our oil markets.

About this title

From the Inside Flap:

Why does it cost $40 to fill your gas tank one year and $80 the next?

What caused oil and gas prices to soar 600% from 2003–2008, only to take a nosedive and soar again over the next couple of years?

Why, if cheap energy sources are more abundant than ever, are we bankrupting our economy in order to make foreign oil producers even richer than they already are?

While there seems to be no shortage of "expert" opinions as to why oil prices have been behaving so erratically, the three most commonly given blame either the decline in the value of the U.S. dollar; China's insatiable hunger for oil; or investor fears of inflation.

Thoughtful people sense there is something wrong with this conventional wisdom about the oil markets, but they are hard pressed to say what it is. Are they correct? Is there another, more sinister force driving the oil's crazy price volatility—something glaringly obvious that the experts are missing or, worse, deliberately glossing over?

The short answer, according to author Dan Dicker, is yes—and that missing "something" is, quite simply, that the oil markets are terribly broken. What broke them, and how can they be fixed before they drag us all down into an economic black hole, is the subject of Oil's Endless Bid.

Few authors are as qualified as Dan to write such a book. During his two decades as a NYMEX oil trader, he watched a clubby niche market explode into a firestorm of financial speculation fueled by a high-octane mix of unbridled greed, the malignant growth of exotic financial instruments, and a near-total lack of oversight.

Interweaving personal accounts with expert analysis, Dan reflects on his life as a trader before and after passage of the Commodities Futures Modernization Act opened up the oil markets to a flood of "dumb money." According to him, the "assetization" of oil, and the rapid growth of oil index funds and ETFs, has created an incessant upward pressure on the price of oil—the lifeblood of American industry. And that pressure has severed it from the practical realities of oil and the oil industries. Hence, "oil's endless bid."

The biggest victim of this latest speculative feeding frenzy is the American consumer, who pays the price at the pump and in the inflated costs of everything—from food and clothing to electric power and even lifesaving medications.

Oil's Endless Bid offers a unique insider's look at the modern face of oil trading, along with expert advice on how to immunize your assets from unpredictable price volatility in the markets. But perhaps, more important, it explains what corporate and government leaders can and must do to address this dire problem . . . before it's too late.

From the Back Cover:

Praise for OIL'S ENDLESS BID

"Eye-opening for anyone who drives a car or uses a lightbulb. Dan Dicker draws on his years of experience at the heart of energy markets and uncovers why Americans are paying the price for huge funds to gamble in futures. By the end, he makes his case for some real-world solutions to a problem that is bound to spiral out of control once again. As compelling as it is entertaining."—Melissa Francis, Host of CNBC's The Call

"Armed with the perspective of a market professional, Dan Dicker dives into the slick, murky world of oil trading and emerges with an illuminating cautionary tale." —Daniel Gross, columnist for Yahoo! Finance and Newsweek

An industry insider tells the biggest financial story of the new millennium—how we lost control of our oil markets

Leading energy industry analyst Dan Dicker recalls his twenty years as an oil trader and describes the huge changes that have taken place in the market over the past decade. He details the impact of the Commodities Futures Modernization Act on the oil market and how the financialization of oil transformed a sleepy niche market into a global Ponzi scheme. He explains how investment banks, energy hedge funds, managed future funds, and ETFs came to dominate energy trading and wreak havoc on the oil market and the world economy. And he exhorts government and corporate leaders to act to stabilize oil prices before it's too late.

About this edition

• Publisher: John Wiley & Sons Inc
• Publication date: 2011
• ISBN 10: 0470915625
• ISBN 13: 9780470915622
• Binding: Hardcover
• Edition number: 1
• Number of pages: 338