January 9, 2007

Energy Market Tea Leaves

Barry Ritholtz:
BP readers correctly pointed out to the change in the Goldman Sachs Commodity Index (GSCI) (Here, here and of course, here). Tim Iacono did a nice job on the details the following month.

That mid-year halving of the gasoline weighting caught quite a few people by surprise. The timing -- slashing energy futures weightings 2 months before the mid-term elections -- was stunning to say the least. The GSCI changes had wide ranging impacts, leading (indirectly at the very least) to: Amaranth's implosion, a drop in CPI / inflation rates, the market rally since the July lows, and of course, GS's record setting Q3/Q4 profits (Hey, its nice to be the House).
Posted by James Zellmer at January 9, 2007 8:49 AM | Subscribe to this site via RSS:
Posted to Business | Energy | Investing