### Step 1: Creating Money from Thin Air
Imagine there’s a big candy jar in the school cafeteria, and each piece of candy costs $1. Now, let’s introduce a new sneaky kid named **Freddy the Fiat Manipulator**. Freddy doesn’t have any real money, but he’s got a magic notebook where he can write down a number, like “$1,000,” and everyone just believes he has it!
Freddy doesn’t actually *earn* this money like other kids who do chores or save up their allowance—he just writes it in his notebook. Pretty cool for Freddy, but it’s not fair to everyone else.
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### Step 2: Freddy Buys Up All the Candy
Freddy uses his magic notebook to “buy” almost ALL the candy in the jar. He didn’t actually work for the money, but since everyone accepts his magic notebook, he can clean out the candy jar.
Now, there’s hardly any candy left for anyone else, and the kids start panicking. “Oh no! The candy is running out! We better pay more to get what’s left!” The price of candy shoots up to $2, then $3, or even higher.
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### Step 3: Freddy Sells High
Once the price of candy is super high, Freddy starts selling the candy he bought earlier to the other kids. He’s making a huge profit because he got the candy with his magic notebook, but now he’s selling it for real money from the other kids. Freddy pockets the cash and walks away much richer.
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### Step 4: The Price Crashes
After Freddy sells most of his candy, the panic starts to fade. The kids realize, “Wait, there’s actually plenty of candy in the jar!” The price of candy drops back down to $1, or even lower because everyone already spent their money on expensive candy.
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### What This Means in the Real World with Oil
Oil is like the candy jar, but instead of Freddy, we have **central banks and big financial institutions**. Here’s how it works:
1. **Fiat Manipulation**: These manipulators can print money out of thin air, just like Freddy’s magic notebook. This gives them the power to buy up huge amounts of oil, even if they didn’t actually produce anything of value.
2. **Artificial Scarcity**: By buying up oil, they make it look like there’s less available, creating an illusion of scarcity. This causes oil prices to rise, and regular people panic and pay more for gas, heating, and transportation.
3. **Selling High**: Once the prices are sky-high, they sell off their oil (or oil contracts) for massive profits.
4. **Crash**: After they’ve made their money, prices crash, but regular people are stuck paying the higher costs while they recover.
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### Why It Hurts Everyone
Freddy’s tricks with candy didn’t just make the price unfair—they left all the other kids with less money to buy other things they needed. In the same way, fiat manipulators using fake money to manipulate oil prices hurt everyday families, causing gas and heating bills to rise. Meanwhile, they walk away richer without contributing anything real to the system.
