Good point about the smaller engine options.
As for biofuels... it is a good example of how "free-market forces" don't understand the purpose of these noble ideas.
Biofuels should be grown on marginal soils (unsuitable for crop production) and should be encouraged in areas where poorer populations could benefit from the new programs.
I noticed the price of oil figures in this discussion.
Below is some info.
This also applies to other commodities like grains.
http://eneken.ieej.or.jp/en/index.htmlProspects for Crude Oil Prices & GCC Investment Strategies
http://eneken.ieej.or.jp/en/data/pdf/437.pdfIn the valuation of paper WTI... there is a void between less than US$60 per barrel and more than $120/barrel.
Speculative traders bid up the price of paper WTI - or paper Brent - as a hedge against inflation and as protection from the falling dollar.
...
Decomposition Analysis of the Soaring Crude Oil Prices
http://eneken.ieej.or.jp/en/data/pdf/421.pdfThe following pages briefly describe (1) demand, (2) supply, (3) insecure supply/geopolitical risk, and (4) futures market in relation to the changes in the oil prices.
[#4 is the one to focus on....]...
http://sciencelinks.jp/j-east/journal/J/F0217A/2004.php...
http://www.rice.edu/energy/research/IEEJ/index.htmlThe research will examine a variety of scenarios for the future of global energy markets, focusing on factors that could trigger a regional or worldwide crisis. The study seeks to assess the geopolitical risks currently facing international energy markets and the global financial system. It also will investigate the consequences that such risks could pose to energy security, pricing and supply as well as to the transparent and smooth operation of the global market for oil trade and investment.
Billionaire financier George Soros tells lawmakers speculation leading to oil price 'bubble'
http://www.iht.com/articles/ap/2008/06/03/business/NA-FIN-US-Soros-Oil-Speculation.phpThe surge in popularity of commodity index funds is "intellectually unsound ... and distinctly harmful in its economic consequences," Soros told a Senate hearing. When speculators enter a market mostly on one side — in this case, betting on rising oil futures — it "distorts the otherwise prevailing balance between supply and demand."
...
Soros, Greenberger others tell truth of Oil market manipulation to Senate Commerce Committee..
http://www.clipmarks.com/clipmark/60A68087-A57B-4DAD-8D11-F10734E624DE/The Senate Commerce Committee Hearings on the Manipulation of Oil and Gas Prices the real star was Michael Greenberger who describes how America is being swindled by traders like Morgan Stanley and Goldman Sachs among others and why our energy prices are out of control due to deregulation and the Enron Loophole created by that swindler traitor Phil Gramm, John McCain's chief economic adviser..watch this it's the most important hearings in some time and the media is ignoring it..
...
http://38.105.88.161/Search/basic.asp?BasicQueryText=sorosSoros is one of the witnesses at today's Senate Commerce Cmte. hearing on energy market manipulation. Sen. Maria Cantwell (D-WA) chairs the hearing.
6/3/2008: WASHINGTON, DC: 2 hr. 16 min.: C-SPAN
I happened to catch much of this on CSPAN. I was outraged, etc., and agree with the summary above (Enron Loophole = deregulation of Futures Markets). Also note the entry (also unregulated) of London and Dubai Futures Markets into US commodities (90% of West Texas Crude).
Their opinion was that between 1/3 and 1/2 of the price of oil was due to speculation on futures markets by large institutional investors and hedge funds (solely for profit, not use of oil for actual energy).
p.s.
So prices should drop quickly below $100 as some regulation is threatened.
