Coincidence or correlation? and a conspiracy theory

Does the graph above demonstrate coincidence or correlation between the 2 indices? do such correlation indicate causal relationship? (Source: Heavy Lifting; See also Kedrosky, and do not miss the discussion (also hat tip) in Big Picture)

A commentator noted in Kedrosky's chart, "Actually, it looks like the prices trail the ratings a little." Here is a conspiracy theory to consider: If your family business sells oil drilling equipment, wouldn't you make sure you pump up the oil price whenever you have some extra political capital?

If such theory holds, the advice to investors is to long oil until Nov 2008
  • ignore all the noise about instability in Iraq or rising demand in China, these are nothing compared with the almighty hegemone, perhaps?
  • all one needs to do is to cut off Iran's supply from the world, how to do this I wonder?
  • before cutting off Iran, perhaps consider other mishaving regimes as well, Sudan, Nigeria?
  • so all these are not about energy security, just about oil price and profit?


No comments: