Oil Speculator: 'Capitalist Pig and Proud'
Are these big oil traders to blame for high prices at the gas pump?
Aug. 20, 2009— -- John Wesley McPherson, Jr. is an oil speculator.
While most Americans were suffering last summer from an economic double whammy -- $4-a-gallon gas and a plunging stock market -- McPherson was profiting. And in the fall when oil prices plunged, McPherson cashed in again.
Betting on oil is a very risky business. But get it right, like McPherson did, and there's a gusher of money to be made.
In 2008, McPherson and the other principals of Sequoia Financial Advisory Services turned a 32.4 percent profit, according to International Traders Research. In the same year, the Dow Jones industrial average lost 33.8 percent.
"I am a capitalist pig and I am proud of it. I have no business being in the market if I'm not trying to make a profit and no one else does either," McPherson said.
Now some in Washington are looking to rein in the ways of these speculators, saying that Americans will have lower prices at the pump.
But these big sellers and buyers of oil on the futures markets -- often unseen by the public -- say that is one of the worst things the government could do and would actually lead to more price instability.
"Speculators are present in the markets to take risks that other people don't want to take in exchange for hopes of making a profit. There were speculators that lost money in the run up of oil prices," McPherson said. "If crude oil speculators are bad, then stock speculators are bad. Then anyone who owns stocks with a profit motive is a speculator."
Not everybody sees it that way. Members of Congress and the trade group representing the major U.S. airlines have blamed speculators for run-ups in the price of crude.
