Looking for someone to blame for high gas prices? An editorial on the Arizona Republic claims it isn’t fat-cat oil barons taking enemas of sweet crude whilst squatting over solid gold bidets in their fancy European palaces that are jacking up the price of oil: it’s Michael Douglas from Wall Street, trading in hedge funds over his torso-sized army field phone.
We’re not kidding, that’s exactly the analogy the author makes:
Try the likes of investors who fashion themselves after Gordon Gekko, the fictional character in the 1987 Oscar-winning film Wall Street, which portrayed the wheeling, dealing nature of the financial capital and its impact on ordinary Americans.
While politicians and pundits point to outsized oil-company profits as a reason for rising prices, these companies have little control over setting oil’s daily price, which is established on trading exchanges around the globe.
Sophisticated investors increasingly buy and sell oil contracts, not to fuel cars or run factories, but to profit from these paper instruments.
We’re always fascinated when people claim with a straight face that capitalist companies and investors are doing something immoral by making a profit. And really, no matter who you blame for high gas prices — oil companies or hedge fund investors — what the complaint always amounts to is “too much profit!”
Hedge funds play major role in gas price hikes [Arizona Republic]