Loading ...In my opinion, the story below is about how the gov’t and banks get involved in the supply and demand price of a commodity. The supply and demand of a product, food, fuel or metal, imo, should ONLY involve the actual producers and final users. Fake “middle men” placing bets, should NOT be involved with buying or selling things they do not own use or produce.
What they have been doing with pricing goods, would be like people betting on the winner of a super bowl football game, and if most of the betters thinks team “A” will win and team “B” will lose, that’s what will happen.
For example, the “gamblers” buying tons of “paper” oil, made oil price get too high. And too low recently. Also, for example, if the weather report says a Cold snap with frost is coming to Florida, they fall over each other to buy long Orange juice contracts and drive price too high.
There have been many complaints to representatives about these market price distortions for decades, but they never do anything about it. Like our open borders, fast and furious, IRS scandal etc. Ie stonewalling.
The story below SOUNDS like they may change their ways because they screwed everything up so much.
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Story, Parts:
The Federal Reserve may curtail Wall Street commodity businesses after lawmakers said banks’ role in energy, power and metals markets spurred unfair trading advantages and could threaten financial stability.
This week, the Senate panel released findings from a two-year investigation that said Wall Street’s role in owning commodities provided undue influence over prices and could threaten the economy
Federal Reserve President William C. Dudley questioned whether banks should be involved in commodities at all. The Fed is looking at the issue “intently,” he told lawmakers on the Senate Banking Committee.
Levin faulted banks for stockpiling commodities at the same time they were engaging in “massive” transactions to buy and sell them and trade derivatives tied to oils and metals. The situation “raises concerns” about market manipulation and unfair trading, he said.
Complete Story: