I seriously do not understand how people can make money off other peoples misery. Should that not tell you something about our economic system Speculation played a big part of the 2008 financial crisis which illustrated the effects this can have by the creation of bubbles in the economic system. This type of behavior really teeters on the edge of morality when applying it to the ethics of the market, but speculation on food is outright criminal when people are dying because they cant afford food. Raj Patel discusses the issue below: In conditions of risk, the market is prepared to pay for certainty. In conditions where the market is prepared to pay for certainty, there is money to be made both in insurance against disaster and in speculation that disaster will happen. At its most native level, this means that rich individuals have started to hoard food, keeping it back from the market in the (correct) estimation that its price will increase. But while that food is gaining value behind closed doors, food is priced beyond the means of the hungry. This is what is also happening at a far larger scale in the Chicago Board of Trade and other commodity markets, where traders and funds buy up options on future production, in the hope that others will share their enthusiasm, bidding up valuable options yet further. Speculation lies at the legal end of practices that are widespread among corporations in times of inflation, where they have the means, opportunity and motive to raise prices beyond an inflationary increase, to raise profits. Such behaviour requires collusion, and even governments happy to let markets reign find it difficult to allow this sort of abuse to continue. At the time of writing, at least three criminal investigations were underway into corporations operating cartels in the supply of food and milk, in Spain, the UK and South Africa.The US has not launched any similar investigations ^ this is reflected in the falling rates of corporate fraud prosecution over the past two decades. Like · · Share
Posted on: Tue, 15 Oct 2013 01:16:21 +0000
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