[lbo-talk] Once again, food prices

Shane Mage shmage at pipeline.com
Wed Feb 9 07:02:00 PST 2011


On Feb 9, 2011, at 9:41 AM, Doug Henwood wrote:


>
> On Feb 9, 2011, at 9:13 AM, Wojtek S wrote:
>
>> I am not an expert in this area, but your explanation blaming the
>> speculators does not sound very convincing. How on earth can a
>> narrow group
>> of people manipulate the prices of products whose production and
>> distribution is so decentralized. Food is not oil or credit, for
>> chrissake.
>
> There are real issues around food - on the supply side, climate
> change, and on the demand, increasing affluence in Asia - but as
> with a lot of things, the fundamentals have been magnified by
> speculation. In the case of commodities, a lot of hedge funds and
> such have poured tons of money into basic commodities - and some of
> these markets, unlike oil, are pretty thin. In more normal trading,
> there'd be speculative interests on both sides, but in this case, as
> in the 2006-7 runup, all the money was betting on higher prices.

"All the money?" Doesn't every trade have two equal--and opposite-- sides?

Shane Mage

"All things are an equal exchange for fire and fire for all things, as goods are for gold and gold for goods."

Herakleitos of Ephesos, fr, 90



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