Saturday, December 04, 2004

Our friends the Saudis

Hindrocket at Powerline points out the drop in oil prices since the election. In the news media this drop is reported as due to an incremental increase in production has built up reserves in the US, coupled with a warmer than expected winter. Bullshit. Powerline has it right, someone was monkeying with the markets to help defeat George Bush.

In my business, when it isn't possible to measure exactly what is happening, it is possible to infer a model of what is happening from the evidence you do have. When you make a prediction based on this inference, and the prediction comes true, then you can get a warm fuzzy feeling about your model of reality and continue to make predictons based your model until something proves you wrong. The rise in oil prices leading up to the election was predicted in March at The American Thinker.
The Saudi War on George Bush - March 10th, 2004
Saudi Arabia has launched an undeclared war on George W. Bush. This simple fact must be understood by policy and strategy elites, the press, and the general electorate. Otherwise, the Saudis may well succeed in their tacit campaign to sabotage the long term success of America’s war on terror, by engineering the electoral defeat of George W. Bush in November....

The rise happened and now is dropping away post-election as the people driving the price increase go back to normal operations (produce as much oil and revenue today, a little less money today is worth more than the hope of more money tomorrow). So until evidence of someone else manipulating the market appears, to me the Saudis are the prime suspects