[Posted
May 2, 2011]Speculators Making a Killing
Food grains and other commodities trading as derivatives
Spiegel Apr 29, 2011
- HAUKE GOOS & RALF HOPPE
Battle Pits Cocoa Speculators against Chocolate Makers
Looking back, it would appear that Ward knew exactly how to bet on the price of cocoa because he knew for sure that it would become scarcer. And he knew this because — conveniently enough — he was actually the very person to make it scarcer in the first place. Indeed, Ward behaved like someone who sees a long line in front of the bakery on a Sunday morning and buys 400 rolls, only to resell them to the people waiting outside at double the price. go to story
The Independent Jul 2, 2010 - JOHANN HARI
How Goldman gambled on starvation
This is the story of how some of the richest people in the world – Goldman, Deutsche Bank, the traders at Merrill Lynch, and more – have caused the starvation of some of the poorest people in the world.
So Farmer Giles still agrees to sell his crop in advance to a trader for £10,000. But now, that contract can be sold on to speculators, who treat the contract itself as an object of potential wealth. Goldman Sachs can buy it and sell it on for £20,000 to Deutsche Bank, who sell it on for £30,000 to Merrill Lynch – and on and on until it seems to bear almost no relationship to Farmer Giles's crop at all.
...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... go to story
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Gold is taken, because gold is the most valuable metal. A small piece of gold, it can carry two hundred dollars. But if I give you iron, then you have to bring another, what is called, bus, to carry it. [laughter] So therefore gold standard is accepted everywhere. There is a standard price of gold, so when I pay you money, it must be, carry the value in gold. That's all. Then there is no inflation. more
Gold coin will check hoarding and inflation
excerpt from conversation, December 31, 1973, Los Angeles
PRABHUPADA: Everyone can understand this is pure cheating. I give you a hundred dollars, a piece of paper. That's all. And you accept it. You want to be cheated. You thought, that "I have got now daily, hundred dollars. So let me work very hard." He does not consider that "I am not getting a hundred dollars. I am getting a piece of paper." So people have no brain to understand even. "This is not hundred dollars. Give me cash, hundred dollars." Then everything, solution will be...
There will be no inflation. Because I know that paying you a piece of paper, I can cheat you, therefore I am printing notes, to cheat so many people. Therefore inflation. But when there will be no possibility to cheat you, then there will be no inflation. Here I have got the opportunity, because I know that pushing forward a piece of paper, I can cheat so many people. So there must be inflation. Is it not? This is not psychological? If I know that I can cheat you by this instrument, so why shall I not increase that? That is inflation. What do you think, Karandhara?
KARANDHARA: That's the basic principle, yes.
PRABHUPADA: Yes. I am cheating you, and people accepting my cheating.
KARANDHARA: The governments actually started the whole thing. They instituted paper money and they instituted it because it is a cheating process. But everyone is participating. So it is just going on and on. That is the real cause of inflation.
PRABHUPADA: Yes. That's it. They are getting encouragement in their cheating business.
...
BAHULASHVA: Srila Prabhupada, what can we do to curb down these rascals?
PRABHUPADA: Chant Hare Krishna.
BAHULASHVA: That will curb them down.
PRABHUPADA: Yes. They will be purified. The more you chant Hare Krishna, they will be purified. This is... All problems are there on account of misunderstanding. What we are distributing? We are simply moving misunderstanding and bringing them to knowledge. This is our propaganda. So Mr. Theologician, is this suggestion appealing to you?
PRAJAPATI: It seems all right for ordinary dealings, Srila Prabhupada, having this money, what's going on, but for large scale transactions it might be very difficult. And as the practical basis, transactions of thousands and thousands of dollars, would be...
PRABHUPADA: That will be good for the people. Because large scale transaction is there, therefore the capitalists hoarding. Capitalists hoarding. Goods are there, everything is there. You pay black price, you get it. Then, when somebody's hoarding, he is not giving to the market. So if the large scale industry and trade becomes stopped, that is good for people.
Jagajjévana: Does that mean the same amount of gold is here?
PRABHUPADA: No, larger scale... Suppose if you want to store, say, thousand kilos or a thousand bags of rice, so you have to pay me gold. But you have no such gold. Therefore large scale industry will be stopped. Just see.
KARANDHARA: Then the price of rice would go very low.
PRABHUPADA: Yes. Then you get actual price and actual value. Goods are there, any part of the world you go, there is enough commodity. But these rascals, they are hoarding, and they are not giving in right time. So people are suffering.
KARANDHARA: Yes. There's a... They buy now. They buy the goods before they are even grown, from the commodity market.
PRABHUPADA: Yes, because they can pay in this paper, the bank will advance. So as soon as you... You have to introduce this metal coins, value. The whole cheating scheme will fail.
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