Commodities traders caused starvation and malnutrition for 200 million people

[hammerntongues]

The price influence that traders make on prices is restricted to volatility and timescale , the prices would eventually get up to or down from the same level anyway , unless you are suggesting that commodity traders actually consume the products that they buy / sell .

By the way traders also sell and make prices go down too , its not a one way thing , its just that demand has vastly outstripped supply over the last 5 years , primarily because of the rapidly expanding Chinese and Indian economies , if you want to blame anyone for high food prices blame them .

 

[butchersapron]

Who are you talking to? Your reply is evidence that speculation exists, but that it doesn't always work. Emphasis on the first part.

 

[free spirit]

Just because the barriers to entry are huge now, doesn't mean they have to be.

"What, so the poorest in society can just send you an email and ask for your money?" - free spirit, shortly before micro-finance.

so you're now advocating the poorest in society / the world borrowing next years food budget and investing it in commodities futures to hedge their position against rising food prices... do you work for the IMF by any chance*?



*not a compliment btw

 

[Ae589]

micro-financing speculation you couldn't make it up.

Your pension is a collective speculative investment vehicle, I don't see why this could not be done on a smaller scale. Let me know.

 

[free spirit]

He lost his arse by the way , Cocoa prices failed to move higher in spite of practically every other commodity rallying , crops were huge , demand was poor and prices dropped , not only did prices fall but they had to pay storage for the 240,000 mtons they took delivery of. It is not as easy as some people believe.

good.

hopefully this lesson might put off others in future, but I doubt it.

 

[Blagsta]

Your pension is a collective speculative investment vehicle, I don't see why this could not be done on a smaller scale. Let me know.

my pension fund has a huge gaping hole in it

 

[butchersapron]

Your pension is a collective speculative investment vehicle, I don't see why this could not be done on a smaller scale. Let me know.

What pension? Let you know what? Have you decided what sort of financing you're on about yet? Let me know when you do.

 

[hammerntongues]

yes speculation does exist but what most people seem to believe is that speculation leads to higher prices where commodities are concerned which is not the case . A speculator will make an assumption of where he believes prices will go and that can be up as well as down . In my opinion and of course it is only that , an opinion , the price will settle according to supply and demand over an extended period . What the commodity traders will do is increase volatilty or the erratic movement between points A and B .

 

[hammerntongues]

.

 

[butchersapron]

yes speculation does exist but what most people seem to believe is that speculation leads to higher prices where commodities are concerned which is not the case . A speculator will make an assumption of where he believes prices will go and that can be up as well as down . In my opinion and of course it is only that , an opinion , the price will settle according to supply and demand over an extended period . What the commodity traders will do is increase volatilty or the erratic movement between points A and B .

So you're simply repeating that it's pure chance that prices rise or fall and that there's no external factors under control of the largest speculators that could possibly effect it. That speculation doesn't effect prices. There are, in fact, no bubbles. And there never has been.

 

[free spirit]

Your pension is a collective speculative investment vehicle, I don't see why this could not be done on a smaller scale. Let me know.

you do realise there are billions of people around the world who have no pension, no capital to invest, nothing of value to borrow against, and who eek out a hand to mouth existence. These are the people who're hit the hardest by the commodity traders speculating on food prices, along with those the next level up the poverty rung who previously just about had enough money each week to save a little or spend it on such luxuries as education, medicine etc. but if the food price dramatically increases will also end up in basic hand to mouth territory.

Food is a basic staple of life and as such there should be an outright ban on speculation such as this from anyone outside of the food related industries (and they should only be allowed to speculate on the volumes that they actually plan to use within their business on an annual basis). Without this it literally means that the speculators in wall street and elsewhere are literally killing the worlds poor in order to turn a quick profit for themselves.

 

[free spirit]

yes speculation does exist but what most people seem to believe is that speculation leads to higher prices where commodities are concerned which is not the case . A speculator will make an assumption of where he believes prices will go and that can be up as well as down . In my opinion and of course it is only that , an opinion , the price will settle according to supply and demand over an extended period . What the commodity traders will do is increase volatilty or the erratic movement between points A and B .

The price volatility is the problem.

it's a problem for producers as they don't know what level of investment is sensible, and can either end up going bankrupt as prices drop due to oversupply stimulated by artificially high prices at the investment stage, or not producing as much as they could have and the price going up more than it needed to.

and it's the problem for the poorest who don't have the means to stock up while prices are low, and starve to death in the periods while prices are artificially raised.

 

[hammerntongues]

So you're simply repeating that it's pure chance that prices rise or fall and that there's no external factors under control of the largest speculators that could possibly effect it. That speculation doesn't effect prices. There are, in fact, no bubbles. And there never has been.

No its not chance at all , it is almost entirely down to outside influence , weather , changes in demand from growing economies , changes in demand from industries ie increased demand biodiesel , foreign exchange fluctuation , wars , embargoes , government intervention , subsidies , import/export taxes , protectionism etc etc etc.

What traders do is try and predict the outcome of some or all of the above influences and try to pre empt the move , I dont think they actually influence the price over the long term but they do most definitely effect the speed at which prices arrive at the end point , or the volatility .

 

[Ae589]

What pension? Let you know what? Have you decided what sort of financing you're on about yet? Let me know when you do.

Not really sure why you are being combative here. I'm afraid I'm just not clever enough to figure out how to put a vehicle together that would let everyone benefit in the same way as rich, leveraged speculators. Perhaps you are, so you can let me know why it would fail.

What I meant was:
1. I can't see commodity trading being stopped without capitalism being dismantled or the technology to make these trades disappearing.
2. The non-speculative idea of futures contracts is to allow cyclical industries to hedge some of the risk of dropping/increasing prices - this is still a useful role, and would be especially useful for people most at risk (the farmer who is a slave to the market price).
3. The big problem with finance in our world as I see it is information asymmetry - the big players have all the cards (in terms of information, wealth and technology). But this is changing slowly (apart from the wealth bit).

I could envisage a situation where a small collective of people with a shared interest in the price of a commodity clubbing together to speculate on the price in order to insure themselves, or even just share in the benefits of some information they have. Couldn't you?


To free spirit -
Thanks buddy, I'm aware there are poor people in the world. I just think my suggestion is more realistic than yours (banning trading). I'd be right behind you if I thought it would work - I don't think people should be making money in this way out of food, water, air, land or health.

 

[butchersapron]

The stampede of money into or out of a market is one of these external influences on price no matter how you feather the term with volatility (which is, again, merely proof of the effects existence). You see it from small scale betting markets to global commodity prices. It is undeniable.

 

[hammerntongues]

The stampede of money into or out of a market is one of these external influences on price no matter how you feather the term with volatility (which is, again, merely proof of the effects existence). You see it from small scale betting markets to global commodity prices. It is undeniable.

Stampede is the greed element and anyone would be foolish to deny its existence but it is clearly not restricted to food commodities , property and cabbage patch dolls are just as vulnerable .
By the time the stampede starts most of the pros will be gone , or as they say " if you can still see the bandwagon , it`s already too late " Human nature .

 

[butchersapron]

Not really sure why you are being combative here. I'm afraid I'm just not clever enough to figure out how to put a vehicle together that would let everyone benefit in the same way as rich, leveraged speculators. Perhaps you are, so you can let me know why it would fail.

What I meant was:
1. I can't see commodity trading being stopped without capitalism being dismantled or the technology to make these trades disappearing.
2. The non-speculative idea of futures contracts is to allow cyclical industries to hedge some of the risk of dropping/increasing prices - this is still a useful role, and would be especially useful for people most at risk (the farmer who is a slave to the market price).
3. The big problem with finance in our world as I see it is information asymmetry - the big players have all the cards (in terms of information, wealth and technology). But this is changing slowly (apart from the wealth bit).

I could envisage a situation where a small collective of people with a shared interest in the price of a commodity clubbing together to speculate on the price in order to insure themselves, or even just share in the benefits of some information they have. Couldn't you?

I'm not being particularly combative - i'm merely teasing out the bones of your ideas. You seem to argue that all future finance is speculation, then pinpoint one potentially good aspect of that activity. Is that the way that you think that people are using the term speculation in this thread?

As or the question - i support social insurance, not this financialised sectional insurance, which has to rely on a set of social relations based on capitalist exploitation somehwere to exist.

 

[butchersapron]

Stampede is the greed element and anyone would be foolish to deny its existence but it is clearly not restricted to food commodities , property and cabbage patch dolls are just as vulnerable .
By the time the stampede starts most of the pros will be gone , or as they say " if you can still see the bandwagon , it`s already too late " Human nature .

Every post you've made has hammered home the truth of the OPs argument.

 

[hammerntongues]

Every post you've made has hammered home the truth of the OPs argument.

If you cherry pick the bits to suit your opinion perhaps , if you try and understand supply and demand in an ever changing market then I disagree .

The market is a far stronger force than any individual or company ( as cocoa guy found out ) prices will settle at their natural level given a reasonable period of time .

How would you suggest we regulate commodity prices ?

back soon for more ..........sorry go to go for a while

 

[butchersapron]

If you cherry pick the bits to suit your opinion perhaps , if you try and understand supply and demand in an ever changing market then I disagree .

The market is a far stronger force than any individual or company ( as cocoa guy found out ) prices will settle at their natural level given a reasonable period of time .

back soon for more ..........sorry go to go for a while

I've not cherry picked anything. You've argued that there is a greed component of commodity trading that effects prices. Haven't you?

 

[Ae589]

As or the question - i support social insurance, not this financialised sectional insurance, which has to rely on a set of social relations based on capitalist exploitation somehwere to exist.

But social insurance doesn't solve the problem, it just externalises the losses.

I guess I see removing the unfair advantage as the battle, and you want to stop the game. I can't say which is more achievable or desirable, but I'd bet on me

 

[Blagsta]

Point is, the game is rigged

 

[nino_savatte]

Stampede is the greed element and anyone would be foolish to deny its existence but it is clearly not restricted to food commodities , property and cabbage patch dolls are just as vulnerable .
By the time the stampede starts most of the pros will be gone , or as they say " if you can still see the bandwagon , it`s already too late " Human nature .

No one eats property or cabbage patch dolls. Indeed, one can survive more than adequately without cabbage patch dolls and property.

 

[butchersapron]

But social insurance doesn't solve the problem, it just externalises the losses.

I guess I see removing the unfair advantage as the battle, and you want to stop the game. I can't say which is more achievable or desirable, but I'd bet on me

Do you work for Amajaro?

Seriously, even your psychic relationship to society and how we organise ourselves is financilaised. 'externalises the losses.' ffs. You've been colonised,

 

[fredfelt]

The market is a far stronger force than any individual or company ( as cocoa guy found out ) prices will settle at their natural level given a reasonable period of time .

In my mind you sentence sums up the problem. Somewhere along the line we have become sub-servant to 'the market'. In may cases it no longer exists as a system of exchange between buyer and seller. It's moved to an all encompassing system which exists for the sake of it and everyone with an interest it it.

In some cases there's almost religious reverence of the market and it's perfect wisdom. Like any human creation it comes with human flaws. Time to put the market back in it's place as a system to support human needs, rather than system we mere mortals have to submit to.

 

[Ae589]

Point is, the game is rigged

Thanks Blagsta, that's my f*cking point!

 

[Ae589]

Do you work for Amajaro?

Seriously, even your psychic relationship to society and how we organise ourselves is financilaised. 'externalises the losses.' ffs. You've been colonised,

No, but I've turned down a job with a commodities trader because of my conscience.

As for your second sentence, I have no idea what you are talking about.

 

[butchersapron]

You don't do you?

 

[Blagsta]

Thanks Blagsta, that's my f*cking point!

Is it? You seem to think the game can be made fair. It can't. The whole point of the game is that its rigged.

 

[littlebabyjesus]

Are you saying people are better off without it?

That's a big question, I think. Quite possibly people are better off without micro-finance, yes. The interest rates on many of the schemes would make a loan shark blush. You're tying the poorest people into the capitalist system by creating unrepayable debts, charging interest rates that will never match the returns on the investments. Micro-finance is just another level of exploitation whereby the rich take wealth from the poor - that's what lending money at interest is.