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Until deregulation, the price for food was set by the forces of supply and demand for food itself. (This was already deeply imperfect: it left a billion people hungry.) But after deregulation, it was no longer just a market in food. It became, at the same time, a market in food contracts based on theoretical future crops – and the speculators drove the price through the roof.
Here's how it happened. In 2006, financial speculators like Goldmans pulled out of the collapsing US real estate market. They reckoned food prices would stay steady or rise while the rest of the economy tanked, so they switched their funds there. Suddenly, the world's frightened investors stampeded on to this ground.
So while the supply and demand of food stayed pretty much the same, the supply and demand for derivatives based on food massively rose – which meant the all-rolled-into-one price shot up, and the starvation began. The bubble only burst in March 2008 when the situation got so bad in the US that the speculators had to slash their spending to cover their losses back home.
When I asked Merrill Lynch's spokesman to comment on the charge of causing mass hunger, he said: "Huh. I didn't know about that." He later emailed to say: "I am going to decline comment." Deutsche Bank also refused to comment. Goldman Sachs were more detailed, saying they sold their index in early 2007 and pointing out that "serious analyses ... have concluded index funds did not cause a bubble in commodity futures prices", offering as evidence a statement by the OECD.
Originally posted by burntheships
reply to post by ArMaP
All the links are there, you can check them all. I checked each one, and all the dates are with in the last several days, the USDA report was just issued end of June 2010. I too was taken aback at the information, that is why I posted it. Please feel free to debunk if you can.
Originally posted by mike_trivisonno
There is not a food shortage.
Food is wielded by those in power to cow the populace.
Obedience = Food
Disobedience = Execution by the State
Farmers know how to grow enough to feed the planet. Politicians and the elite ruin it because they are greedy.
When there is no food: Eat the Rich.
Originally posted by unityemissions
It's not as if there are millions of tons of food being hidden from the people so that they'll just starve. Read through some of the facts, first. This U99 fungus could cause enough damage to wipe out millions in itself.