Why are gas prices so high? The Book of Morgan
In the beginning, there was oil. Well, not exactly oil but its ingredients. Once-living organisms became one with the planet upon their deaths, eventually breaking down and congealing over millions of years to form the lubricious substance we know today as oil. Time, heat and pressure created the necessary conditions to concoct this lifeblood of modern human existence.
Today, as we stare at the rising price of gasoline with bewilderment, we wonder how it came to be that something so ubiquitous could be so expensive. For the past few years I have written a great deal on this very subject and have come to the conclusion that while peak oil is a real phenomenon not just a theory, our ingenuity has held this reality at bay for the time being. Furthermore, the forces that cause price spikes and volatility in oil and the commodities markets as a whole have little to do with actual market conditions such as supply and demand.
The investment banking industry, with the assistance of the federal government, has surreptitiously hijacked the oil business over the past decade and caused the price of oil to skyrocket. But this is rarely the story that is told in the media. And because the subject matter is so dense, it's difficult to explain. It's complicated and boring. No way around it.
So instead of banging the oil drum here for the umpteenth time to no avail as I watch pundits butcher the subject and politicians lie through their teeth to the American people, I have decided that a change of venue is in order.
To properly explain why oil prices are so high, I enlisted the support of my friends Doug Wood and Rob Bellon to help me tell the story a little differently. In lieu of my normal offering in Off The Reservation, we have produced an 8-minute video called "The Book of Morgan," which tells how investment banking giant Morgan Stanley came to rule the oil world.
The story itself is an age-old chronicle of greed and corruption filled with intrigue and dirty dealings. It illustrates how Morgan Stanley, among others, took the hidden world of commodities trading from a $10 billion industry to a $450 billion business by maneuvering through generous loopholes created by Congress. It shows how Morgan Stanley not only dominates the trading arena but how it has become a full-fledged Big Oil company from transportation to terminal storage to having an ownership stake in the very exchange that half of the world's oil is traded on.
So with that, I invite you to watch the video and judge for yourself why the price of oil has skyrocketed. The purpose of presenting it this way is to open more eyes as to how rotten our system truly is and to elevate the dialogue about one of the most crucial economic elements of our daily lives. In the next several months we will be bombarded with finger pointing and accusations with respect to gasoline prices as the presidential campaign heats up. But few of the arguments you will hear will resemble the truth. For the truth, my friends, can only be found in the gospel according to Wall Street−and "The Book of Morgan."
(For more: http://www.LongIslandPress.com/bookof...
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