EDITOR'S NOTE: Like the article below says, every American old enough to drive or make purchases is now an “energy trader.” We’re taking advantage of low energy prices when we find the opportunity and hedging against high energy prices in whichever way we can (e.g. reducing our travel, buying a hybrid car or EV, etc.). By extension, and given our inflation crisis, are we now also indirectly “dollar traders” as well? We take advantage of great prices when we can find them, stocking up on basic necessities that happen to be on sale, and we hedge prices by finding a more competitive deal or simply reducing our spending on costly goods. In a way, yes, we are dollar traders, and that’s a problem because this “trade” has serious limitations: for many Americans, the dollar defines their total conception of wealth. And it’s a rigged game, as the highest level you can reach in your respective playing level is the highest value the dollar can offer, which is perpetually eroding. Owning physical assets like gold and silver may be one of the only ways out of this arena altogether, as both give you a level of optionality beyond the dollar’s imposed limits.
Fun fact: The authors of this newsletter are also energy futures traders, Emily can now reveal.
What's happening: Like millions of Americans, Matt and I have placed a bet on our respective energy bills by contracting to pay a certain price for our home heating oil over the next year or so — figuring prices are likely to keep going up.
- I placed my bet in the spring, locking in $4.299 per gallon. Today they're offering the same contract at $5.099 per gallon. So I'm feeling pretty good.
Matt's thought bubble: Emily out-traded me — I capped my price at a searing $5.30 per gallon in early August. Ouch.
Zoom out: With energy costs soaring — particularly for natural gas — customers around the country have turned into de facto energy price forecasters, Bloomberg details.
- More than 20 states allow residents to choose their electric or gas provider, many of which offer these kinds of contracts.
- One woman tells Bloomberg she just agreed to pay her provider 60% more than her previous contract; another fellow says he's betting prices will fall and isn't signing anything. "This is like the storm," he says. "I'm riding it out."
The bottom line: Even at home, you can't escape the markets.
Originally published on Axios.