Subject: Quantitative Analysis of Non-Linear High Entropy Economic Systems Addendum

From: John Conover <john@email.johncon.com>
Subject: Subject: Quantitative Analysis of Non-Linear High Entropy Economic Systems Addendum
Date: Fri, 06 Jun 2008 16:09:20 -0700



A short analysis of light sweet crude oil futures prices was added to
the Addendum page. (The futures traders set crude oil prices, BTW, and
not the oil companies-the oil companies, essentially, buy oil from the
traders.)

The crude futures market is a text book competitive industry, (one would
be hard pressed to find a better example-it is remarkably efficient, and
the empirical data is very close to its theoretical values.)

Currently, there is a price bubble, (with a fair market value based on a
decade historical perspective,) of about $80-$90 per barrel.

That's the good news-there is, also, a 50% chance that the price bubble
will last at least 3.5 years, at which time there is a 50% chance that
the price per barrel will be above $130-$145.

    John

http://www.johncon.com/john/correspondence/020508170137.5425.html#appendixIX

--

John Conover, john@email.johncon.com, http://www.johncon.com/


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