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    Authored by Steve H. Hanke of The Johns Hopkins University. Follow him on Twitter @Steve_Hanke. A few weeks ago, the Monetary Authority of Singapore (MAS) sprang a surprise. It announced that a...

Bidders For 30 Million Barrels Of Strategic Petroleum Reserve Disclosed; JP Morgan Requests $158 Million In Crude

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Wed, 07/06/2011 - 18:49 | 1431125 Caviar Emptor
Caviar Emptor's picture

Hey, they ain't stupid: They need the oil for private jets and air conditioning. Oh and for the secret survival shelter/panic room under the desert for top brass to use after the revolution breaks out. 

Wed, 07/06/2011 - 19:07 | 1431168 Miss Expectations
Miss Expectations's picture

Check out this Ozark 'retreat'

http://ccheadliner.com/news/article_fca0c66e-1db0-11e0-93d8-001cc4c03286...

If you're in a Google mood...you might want to check out what Overwatch Systems is up to.

The property’s deed says the Steven T. Huff Family, LCC is located in Leesburg, Va. Available online records of political campaign contributions show a Steven T. Huff of Leesburg to be an engineer and chief technology officer of Overwatch Systems, Ltd. According to the Overwatch website, the company “delivers multi-source intelligence (multi-INT), geospatial analysis and custom intelligence solutions to the Department of Defense, national agencies and civilian organizations. ... More than 25,000 analysts in the U.S. Department of Defense and the larger intelligence community utilize Overwatch solutions.”

Wed, 07/06/2011 - 20:15 | 1431324 Caviar Emptor
Caviar Emptor's picture

Can you say military-industrial complex?

Wed, 07/06/2011 - 20:55 | 1431399 macholatte
macholatte's picture

can you say kleptocracy?

William Daley, President Barack Obama’s chief of staff and former banking executive at JPMorgan Chase & Co. (JPM), .......

 

http://www.bloomberg.com/news/2011-03-24/daley-obama-chief-of-staff-won-t-play-role-in-consumer-search.html

 

 

Wed, 07/06/2011 - 21:17 | 1431431 Cursive
Cursive's picture

But by far the most important news is that 80% of the bid are based on a vessel-based distribution, meaning it will be weeks if not months before the SPR disposed crude finally makes it into circulation, if at all, and has an actual supply-side benefit.

can you say kleptocracy? ~ macholatte

Yes, very criminal, but I guess not enough care.  Seems we have peak apathy.

Wed, 07/06/2011 - 21:31 | 1431452 Manthong
Manthong's picture

Can you say Vaseline?

1.5M barrels should refine enough petroleum jelly for at least a dab for each American.

Thu, 07/07/2011 - 07:43 | 1431952 Bartanist
Bartanist's picture

A house built by robbing the taxpayers.

Kleptocracy, indeed.

Wed, 07/06/2011 - 19:11 | 1431178 nope-1004
nope-1004's picture

They need oil for their new ETF they're going to start up, symbol GBW, which is short for Greasy Bankster Whores.

Then, they'll be able to front run every trade, manipulate futures, claim 'adequate' storage relative to the inflated ETF price, go net short periodically then bash down price on Christmas Eve (gotta get rid of the evil speculators, ya know).

JPM is a friggin' farce.  One day supply of oil 'flooding' the market is too.  Complete desperation on behalf of the Incompetent in Chief.

 

Wed, 07/06/2011 - 20:47 | 1431385 Raynja
Raynja's picture

so the prices appeared to average around $106bbl, is that indicitive that the exchanges are manipul;ated and that is the real cost of a barrel of wti or that the price is going to rise past there soon and make this an arbitrage opportunity for tbtf?

Wed, 07/06/2011 - 22:55 | 1431594 pavman
pavman's picture

I think that's just the Brent price.  A bit ironic if you ask me, but perhaps the gubment doesn't know that Brent != WTI.  Its not hard to see that the premium for Brent is due to the North Sea.  Seems like GS and JPM might be shorting (or considering it) and want to get a physical hedge up.  Who knows.  People who buy oil and gold at these prices are probably suckers (Mexico, China.... etc).  Or the inflation to come once the RHINO gets elected next yar will destroy our currency's value when they don't raise taxes and fail to cut substantial spending.

On the bright side...at least BarryO is slick enough to approve (dare I say co-wrote) in the stimulus legislation that now he's condeming as if its some Republcian tax break for the rich thing.  Politically brilliant, but a bit disgusting none-the-less.

Wed, 07/06/2011 - 23:55 | 1431679 trav7777
trav7777's picture

this stuff they're selling is the high-yield, lightsweet crude.  It's flat out worth more

Wed, 07/06/2011 - 20:38 | 1431373 Clinteastwood
Clinteastwood's picture

Soros:  Hey Obama, looks like you're in dire straits and will need about $100 Billion to win your campaign.  That's no problem but how about releasing a bunch of the strategic petroleum reserve so we can short the market?  We should be able to recover that amount with enough futures.  We'll send you what you need.  The price of oil will go back up in a few days.  Tell Jamie about it a little later--he'll still be able to make a killing when the price goes back up in a few days.  It will hardly even affect the real market for oil products, and you can claim you're doing everything possible to get the price of gas down.

 

Obama:  Duhhh,  yeah that's it, yeah, yeah, yeah that's it, yeah...

Wed, 07/06/2011 - 18:54 | 1431134 Dre4dwolf
Dre4dwolf's picture

So the mega rich got the govt to dump our strategic emergency oil reserves on the market for almost free.

Then they bought it all up and made the price jump back up.

And now they are going to sell us our own oil at a premium?

Wed, 07/06/2011 - 19:36 | 1431180 GoinFawr
GoinFawr's picture

Hey lighten up, Canadians have been doing that to themselves for decades.

Wed, 07/06/2011 - 19:14 | 1431186 cosmictrainwreck
cosmictrainwreck's picture

I think you're getting the hang of this....... send resume to Jamie

Thu, 07/07/2011 - 01:06 | 1431753 unununium
unununium's picture

Come on, it's not as if the treasury secretary met with the mega rich and orchestrated a cash transfer to their counterparty, so CDS could be paid off.

Wed, 07/06/2011 - 18:59 | 1431137 Rodent Freikorps
Rodent Freikorps's picture

I get the feeling that this is the beginning of the sell-off of assets of USA Inc.

They do own about 90% of the Western states. I'd hate to be Arizona and New Mexico when Carlos Slim offers a billion for Tucson, and neighboring areas. A reverse Gadsden Purchase.

The funny part would be if the Feds told the locals, "Hey, bitches, y'all want to be Mexicans, have we got a deal for you."

Wed, 07/06/2011 - 19:00 | 1431151 youALREADYknow
youALREADYknow's picture

There are only two ways out of the current scenario and those are hyperinflation and liquidation. The U.S. is staring a margin call in the face by the end of the decade.

 

Wed, 07/06/2011 - 20:32 | 1431361 I think I need ...
I think I need to buy a gun's picture

i think they will dump all the extra money into gold avoiding hyperinflation but inflation will be enough to kill everyone enough

Thu, 07/07/2011 - 00:46 | 1431199 GoinFawr
GoinFawr's picture

"I get the feeling that this is the beginning of the sell-off of assets of USA Inc."

You have a problem with that pinko? And I thought you called yourself a 'capitalist'...

(Heh, you gotta marvel at the magnitude of doublethink Americans can carry around in their coconuts without even breaking a sweat)

Hmmm, I see that some self-styled 'capitalists' are at a loss for words, yet feeling 'junky'.

'Junk-capitalists'

Wed, 07/06/2011 - 19:42 | 1431259 Shameful
Shameful's picture

Really would you?  If it's gone that far I think I would rather take my chances and learn Spanish rather than learn Newspeak in the reeducation center.

Also there is some talk of UT using eminent domain on the Feds land holdings.  That happens and all manner of "fun" will happen in the Western States.

But don't worry, there will be many tells before hand.  The real fun won't start till after the 401ks and pensions are seized by Uncle Sugar.

Wed, 07/06/2011 - 20:34 | 1431366 Diogenes
Diogenes's picture

The beginning ha ha ha the beginning of the end maybe. They have been selling off whole factories  equipment and industries since the 6Os. Why not oil reserves.

Wed, 07/06/2011 - 18:56 | 1431138 camoes
camoes's picture

So the US Govt is subsidizing cheap oil to a subsidized US TBTF bank so that they can make some risk-free storage yield on it...

This is so wrong it's not even funny anymore...

Wed, 07/06/2011 - 19:10 | 1431176 rocker
rocker's picture

The best one can hope for is as soon as the price escalates again they announce another round to sell off without disclosing the actual amount. Kind of funny how none of the airlines took any as a hedge. What do they know? 

Wed, 07/06/2011 - 20:42 | 1431377 camoes
camoes's picture

even worse, since IEA has to replenish the "strategic" reserves at some point, guess who will be selling them back??? Even better, we will find out that the barrels that were sold to JP Morgue never left IEA, so they didn't have to spend with transportation, everyone wins!!! Next: Fort Knox gold!

They're genius! QUANTITATIVE STRATEGIC RESERVES EASING

 

Thu, 07/07/2011 - 17:59 | 1434309 swissinv
swissinv's picture

+100!

Wed, 07/06/2011 - 19:57 | 1431290 oogs66
oogs66's picture

The government hates speculators but not jpm? Why not make it open only to oil companies? Truly messed up

Wed, 07/06/2011 - 18:56 | 1431139 medicalstudent
medicalstudent's picture

jpm took delivery on a million tons of sugar.

 

http://investmentwatchblog.com/jp-morgan-accepts-delivery-of-952938-tons...

 

jpm is a curse, full of blight.

Wed, 07/06/2011 - 19:23 | 1431211 caerus
caerus's picture

sweet...

Wed, 07/06/2011 - 19:30 | 1431223 kito
kito's picture

wait, before i continue to fume here, is it possible jp morgan took delivery of oil on behalf of a client?

Wed, 07/06/2011 - 20:16 | 1431319 tom a taxpayer
tom a taxpayer's picture

Perhaps. But it could also be that JPM is returning to the banking days of yesteryear, when banks offered toasters to new customers. JPM could be planning to offer each new customer a barrel of crude. And if the customer will open a $1 million savings account account paying -.01% interest (compounded daily!), JPM will refine the barrel of crude into high-octane no-knock gasoline. Or, to stretch the crude, JPM may offer each new customer a pint of lubricating oil. 

Thu, 07/07/2011 - 00:36 | 1431728 Freewheelin Franklin
Freewheelin Franklin's picture

I LOL'd

Thu, 07/07/2011 - 01:08 | 1431754 unununium
unununium's picture

I see your education is coming along, Kito.  Welcome to the truth.

Wed, 07/06/2011 - 19:50 | 1431274 Caviar Emptor
Caviar Emptor's picture

Yup. Now they can work on Congress putting tariffs on sugar imports. That would cover the Xmas retreat on St Bart's

Wed, 07/06/2011 - 18:56 | 1431141 youALREADYknow
youALREADYknow's picture

Only a matter of time before the "Strategic Gold Reserve" is handed over to entities such as JPM and Goldman at artificially low prices under the guise of aiding the so-called recovery.

Wed, 07/06/2011 - 19:30 | 1431224 Printfaster
Printfaster's picture

I thought Clinton has already done that back in the 90s. 

Ever wonder why the price of gold never went anywhere in the 90s?

Wed, 07/06/2011 - 21:13 | 1431424 Bay of Pigs
Bay of Pigs's picture

Yes, that is correct. Between Greenspan, Rubin and Summers, the US gold horde was put into play back then to keep gold and inflation low, and the "strong dollar" mantra looking totally legit. They made boatloads of money selling, leasing and swapping the gold and then piling into higher yielding instruments.

JPM was front and center in all of that, and the other bullion banks as well.

Wed, 07/06/2011 - 19:51 | 1431277 Caviar Emptor
Caviar Emptor's picture

We know JPM is acting as custodian for at least a portion of that

Wed, 07/06/2011 - 18:57 | 1431142 Freewheelin Franklin
Freewheelin Franklin's picture

So...where exactly is Blythe's secret refinery located?

Wed, 07/06/2011 - 20:39 | 1431374 Ahmeexnal
Ahmeexnal's picture

Intestinum crassum

Wed, 07/06/2011 - 18:57 | 1431144 buzzsaw99
buzzsaw99's picture

JPM is adept at the Con-Tango.

Wed, 07/06/2011 - 19:00 | 1431148 dollarmite
dollarmite's picture

So is the JP Morgue one of those oil speculators that Obama is going to clamp down on?

Wed, 07/06/2011 - 19:06 | 1431161 swissinv
swissinv's picture

getting back the strategic oil reserves

Wed, 07/06/2011 - 19:08 | 1431164 hambone
hambone's picture

Funny but I've a funny feeling a fair amount of this oil could end up in Europe or Latin / S. America...once in the tanker simply looking for highest bidder?

Wed, 07/06/2011 - 22:24 | 1431475 delacroix
delacroix's picture

I have a funny feeling, some of this oil will be delivered, in lieu of precious metals, when delivery is not possible. what else is there, with real current value?  is this what they mean, by (asset stripping)? I miss the days, when they would at least wrap their shit sandwich, in bread.

Wed, 07/06/2011 - 19:09 | 1431173 Missiondweller
Missiondweller's picture

Unbeleivable. I'm just stunned. And how stupid is the administration that they're allowing non-refiners to bid and speculate with taxpayer puchased oil?

Wed, 07/06/2011 - 19:13 | 1431184 kito
kito's picture

are you kidding me!!!! this literally makes my stomach turn. tyler, isnt there anyway you can feed this story to any other large exposure blog???? this info must get out there!!!

Wed, 07/06/2011 - 19:13 | 1431185 PulauHantu29
PulauHantu29's picture

LMAO!

People love to Bash oil and gas companies......LOL....they need to look at GS and JPM....well, I mean look at them as they bend over with a tube of KY b/c they will need it.

Wed, 07/06/2011 - 19:18 | 1431195 Ab80
Ab80's picture

Can you guys please stop referencing how right you are, i read ZH every day, its unnecessary to cite your predictions coming true. Unless youre making money on it, its irrelevant. 

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