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Originally posted by 44soulslayer
You proposal for needing physical delivery is ridiculous and would result in only increased shipping and storage
And while we are at it, your food prices arent controlled by speculation. They are controlled by supply and demand. Thus your premise is entirely wrong anyway.
Originally posted by kosmicjack
This part of your answer sounds much like why we went to paper money instead of carrying gold around. Paper is so much easier to manipulate, just print somemore.
Speculation trades on commodities based on transient daily factors do act to jack up the prices by creating artifical supply and demand.
Is Capitalism so fragile and tenuous that it can't stand a little scrutiny? If so, then it really is all smoke and mirrors and it's no wonder people get so defensive when it's called into question.
The Commodity Futures Trading Commission said last week it will meet with farmers, traders and grain sellers next month to assess the recent price jumps.
The loss of equilibrium has rattled large grain merchants that buy wheat and other crops and sell them to food processors like Kellogg Co. and General Mills Inc.
"There has been a huge influx of capital from index funds and pension funds to the point now where futures markets are not reflecting actual supply and demand," said Todd Kemp, spokesman for the National Grain and Feed Association.
As a result, Kemp said grain buyers have had to pay more to hedge themselves against future price shifts. Some of those expenses have been passed on to food processors and then to consumers. The futures volatility is adding to a cocktail of cost-raising factors that have pushed bread, cereal and other staples to record highs.
The price of white bread rose to $1.32 a pound last month, up 28 percent from a year ago, according to government data.