Daily Speculations

The Web Site of Victor Niederhoffer & Laurel Kenner

Dedicated to the scientific method, free markets, deflating ballyhoo, creating value, and laughter;  a forum for us to use our meager abilities to make the world of specinvestments a better place.



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8/10/04 Victor Niederhoffer: Quote of the Day

"The higher oil price should benefit these companies [BP and Total]...there is a very real concern that supply will fall short of demand ". --Paul Morgan, 'a fund manager which manages about 2.7 billion in UK stocks and owns shares of BP and Shell...'

But usually supply does not fall short of demand. The price increase enhances the quantity supplied, and decreases the quantity demanded and such changes reduces the price. That's the fundamental law of economics corresponding to the laws of motion in physics. That's the reason that the Collab and I found that stocks went up some 100 times as much as almost every commodity during the last century. When will this law assert itself for oil as it did for all the grains?