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What Do You Think Is Causing Food And Commodity Prices To Go Up?

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You missed the hedge fund reason.

They are doing God's work and by increasing the price of food, they are encouraging people to grow more food which will ultimately increase the supply of food so everyone can be amply fed.

If a few people die of starvation because the spike in prices, that is clearly the fault of the science of economics not the hedgies, not in the least.

:)

Edited by daiking

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It is the perfect storm. Weather, QE hot money, Panic (hoarding), too many people, stupid govts subsidising land to be non productive, idiotic green policies to turn food into petrol.

So basically in one word - Governments.

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Traders,

Its great blame them when the price goes up through buying and blame them when the price goes down through shorting

But be sure not to blame shorting when the price of the thing you want to be low is low and be sure not to blame buying when the price of the thing you want to go up goes up

Edited by Tamara De Lempicka

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Yeah of course its the speculatoirs innit not the printy printy central banks muppets and politicos.

How dare anyone with any savings try and protect their hard work by investing in something that isn't going to be butt fuc*ked by the central banks.

Great question IMO 78% get it and the other 22% I hope are being ironic.

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IMO there's a grain of truth in the supply side issues, but the bulk of the growth is largely down to money printing and speculation.

As Gravity Always Wins says, commodities are one way to try and protect wealth from the machinations of government, but I believe what we are mainly seeing is direct inflation caused by the FED and central banks. They've printed up money to buy trash assets from the banks, who in turn have used the money speculate in the markets to try to rebuild their balance sheets. It is just as inflationary as lending out to people on the street, it is just the money enters the economy in a different place.

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You missed the hedge fund reason.

They are doing God's work and by increasing the price of food, they are encouraging people to grow more food which will ultimately increase the supply of food so everyone can be amply fed.

If a few people die of starvation because the spike in prices, that is clearly the fault of the science of economics not the hedgies, not in the least.

:)

+1

If you're greedy enough, if you really don't have an even a pinch of moral fibre then you can justify just about anything.... "if we don't supply the Zyklon B someone else will"

If you're a "hard pressed" saver you really need to get over yourself.... you've got money in the bank... big deal, so what? If I want more income & put in some extra graft.... instead of relying on some poor "debt sucker" to do the work you could always try earning your income through old fashioned work.

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It is just as inflationary as lending out to people on the street, it is just the money enters the economy in a different place.

Quite right Genaral,

People used to ask how the money got into peoples pockets - the answer it doesn't but it does go into other peoples pockets.

How will people be able to afford things - answer they won't.

GDP collapsing and prices rising is a bad thing caused by central banks but as prices rise and the electorate start squealing they'll just print up some more to match the demand for money caused by a crashing economy and high prices.

Rinse and repeat

BTW "Change you can believe in! I love it!

Edited by gravity always wins

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IMO there's a grain of truth in the supply side issues, but the bulk of the growth is largely down to money printing and speculation.

As Gravity Always Wins says, commodities are one way to try and protect wealth from the machinations of government, but I believe what we are mainly seeing is direct inflation caused by the FED and central banks. They've printed up money to buy trash assets from the banks, who in turn have used the money speculate in the markets to try to rebuild their balance sheets. It is just as inflationary as lending out to people on the street, it is just the money enters the economy in a different place.

...you are right, as always. ;)

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+1

If you're greedy enough, if you really don't have an even a pinch of moral fibre then you can justify just about anything.... "if we don't supply the Zyklon B someone else will"

If you're a "hard pressed" saver you really need to get over yourself.... you've got money in the bank... big deal, so what? If I want more income & put in some extra graft.... instead of relying on some poor "debt sucker" to do the work you could always try earning your income through old fashioned work.

Commodities futures contracts have existed for over 5,000 years the earliest one is for wheat on a clay tablet.

If you want to get your food from a supermarket rather than bartering with a farmer you will need a middle man.

Farmers are happy to sell forward contracts as it helps them with liquidity seeds equipment etc.

I assume that savings are the result of hard graft already but apparently its not acceptable to try and maintain their purchasing power!

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+1

If you're greedy enough, if you really don't have an even a pinch of moral fibre then you can justify just about anything.... "if we don't supply the Zyklon B someone else will"

If you're a "hard pressed" saver you really need to get over yourself.... you've got money in the bank... big deal, so what? If I want more income & put in some extra graft.... instead of relying on some poor "debt sucker" to do the work you could always try earning your income through old fashioned work.

I was trying to be a teensy bit ironic and was recalling one of those droning and dull Will droning Hutton docs on C4.

No one cares what's happening to the little people and no one cares if the little people even realise what's happening to them. You can blame anyone you like, won't make a difference.

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I've selected speculation which is a big part of the rise as it leads to the hoarding we are beginning to see, but it's also the increase in the quantity of money: people have more money to outbid each other for a static amount of resources, hence prices rise.

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Speculation for commodities the world in general but for UK food it is also this type of thing.

Top bosses grab pay rise of 55% in a year

The bosses of Britain's 100 biggest companies are enjoying lavish pay rises despite the economic crisis

http://www.thisismoney.co.uk/news/article.html?in_article_id=517324&in_page_id=2

Talk of inflation is self-fulfilling because it gives those that can an excuse to charge more for their goods so they can reward themselves excessively.

Then we have the VAT excuse for adding a little extra onto prices.

Maybe another option "The public being robbed in daylight because we have a corporatocracy instead of a proper government"

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From FT Alphaville:

Goldman kind of disagrees with the Fed on commodities inflation

Bernanke’s argument, by the way, is that increased commodities inflation in the emerging world reflects the growing wealth of EM populations and, in some countries, a failure to tackle inflation through their own monetary policy or by adjusting exchange rates.

But, over to Vaknin’s Friday note:

This is partly because higher policy tightening in the context of on-hold Fed and ECB rates would adversely lead to greater currency appreciation. The irony here is that by focusing on core inflation (whether explicitly or implicitly), the major central banks are ‘exporting’ looser monetary policy to EM, and as a result, they are being forced to ‘import’ back higher food and energy prices …

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Double bubble.

Central banks print the crap out their currency, gift cheap money to first users of that creadit who go and splurge in on whatever they fancy to collect their bonuses.

For the greater part of the last decade it was the housing finance ponzi scheme where it got so bad they had to cook up a pack of lies risk rating and seconday market to keep as far away from the smell as possible. Even that didn;t work they got so greedy - just handling the stuff as if was shuffled off their books was enough to bring them down.

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Commodities futures contracts have existed for over 5,000 years the earliest one is for wheat on a clay tablet.

If you want to get your food from a supermarket rather than bartering with a farmer you will need a middle man.

Farmers are happy to sell forward contracts as it helps them with liquidity seeds equipment etc.

I assume that savings are the result of hard graft already but apparently its not acceptable to try and maintain their purchasing power!

1)The contracts you mention required the middleman to physically accept the commodity, severely limiting the possibility for speculation. There was also a large number of middlemen, in todays futures markets some of the players are so big they can easily force the price up, this being especially easy in food commodities given its non-discretionary nature.

2)I call bullcrap on the savings bit. The vast majority of the speculative money isnt hard-earned savings but the illusionary profits from the various other bubbles being monetized and put to speculative use. Instead of the illusionary profits being partially inflated away they want to keep it all, and so the little man is being forced to take all the pain.

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Weather, quantitative easing and population increases, as well as land being used for biofuels instead of food. The political situation in Zimbabwe doesn't help either. Hoarding to a certain extent, but I don't blame hedge funds, and they are mostly taking side bets on the movement in the market rather than having actual warehouses of food stashed away.

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1)The contracts you mention required the middleman to physically accept the commodity, severely limiting the possibility for speculation. There was also a large number of middlemen, in todays futures markets some of the players are so big they can easily force the price up, this being especially easy in food commodities given its non-discretionary nature.

2)I call bullcrap on the savings bit. The vast majority of the speculative money isnt hard-earned savings but the illusionary profits from the various other bubbles being monetized and put to speculative use. Instead of the illusionary profits being partially inflated away they want to keep it all, and so the little man is being forced to take all the pain.

No the tablet was tradeable is if it was money, all futures contracts stand for delivery at some point in time but they can be bought and sold thus providing liquidity twas ever thus nothing has changed.

Call bullcrap all you like but if you look at where most of the worlds savings are they are either from commoditiy rich countries or exporting countries one is a sacrafice of future resources and the other is the result of industrious labour and productivity.

Which of these two groups do you find less deserving than our need to print our way out of obligations we undertook but are now defaulting on?

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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