Author Insight –
History might just repeat itself
Wolfgang is a seasoned financial professional who practically eats numbers morning, noon, and night. He possesses an amazing recall of past events to relate to behaviors today. He and Quip sometimes have opposing views which could be attributed to generational differences or jaded perspectives.
In this portion of the story the changes in the commodities market, focusing on oil at this point, is coming into question. Wolfgang outlines how one could game a very established system to cause radical results in the commodities market.
His logical presentation of his point of view is nearly discounted out of hand until Wolfgang adds the lessons of history.
Could his point be valid for more than just this story? Let us know.
Excerpt-The Enigma Broker
Quip added with his usual comedic observation, “Yeah, I see what you mean, since no one is interested in buying extreme religious beliefs or terrorism, which are free exports anyway. They really do need some more viable products that are desired exports. When your only marketable raw resource is oil, you get branded as a one-trick-pony.”
Otto and Wolfgang rolled their eyes as Wolfgang resumed, “This turn of events has added legitimate quantities of oil to the world markets, not just bogus numbers. However after being ostracized from the international markets for so long, their accounting practices have deteriorated, and they do not have the appropriate measures of financial governance to participate with other international entities. Basically, their financial checks and balances, required to play in the global marketplace, would be like having an uneducated teenager, from some backwater farming community, show up at a high society gala dressed in overalls while everyone else is in tuxedos and gowns. Their size may allow them in, but they would be hopelessly outclassed in participating with the others.”
Otto puzzled that comment for a moment and then asked, “I admit that they may not be as sophisticated as the others of the world market, but they have legitimate product to offer. Where are you going with this, Wolfgang?”
Wolfgang responded, “If the so-called sophisticated oil commodity traders are being maneuvered with bogus figures, how can this fresh entrant into the marketplace expect to compete? I believe that their systems will be so porous that whomever is boosting the other world producers will do the same to Iran, and inflate their production numbers with yet another quasi-legitimate oil source. Moreover, they won’t have the financial discipline to resist selling for an ever lower dollar per barrel price. I see them playing right into the hands of this DMO.”
Quip mused, “It’s as if this conspiracy is growing legs and walking off on its own. With everything you are seeing, perhaps we should just turn around and float downstream with the current instead of fighting it.”
Otto and Wolfgang both turned to give Quip a hard look, as Wolfgang tersely stated, “That is exactly what happened when the Nazi party came to power in Germany in 1933. No one contested their illegal activities because the economy was getting boosted by the flagrant disregard of the laws.
“Now, here we are again, things are being manipulated inappropriately, but because the results favor me currently, why should I complain? This situation is no different, because the laws of civilization are being violated with the end game that we all will lose. Individuals, corporations, nations, and belligerents must be made to play by the rules, or we all end up in a world war like 1939. We are here in this place and in this time with knowledge of history that clearly illustrates that flagrant disregard for the law cannot be tolerated. The answer is always the same; either stop it early, or stop it later. The only difference is how much more effort it takes to stop it later.”
Quip nodded thoughtfully and quietly stated, “Point taken.”