To help you understand why the futures market, which
controls cash prices, works the way it does, I will give you a picture
of how the Spec Fund managers who run the market see the world.
1) All corn goes to ethanol and all soy to bio-diesel.
2)
The weather in (fill in the blank) _____________, S. America, China,
Russia, Mongolia, Zululand... is bad so soy/corn/wheat (pick one) will
be scarce so prices must go up.
3) When the price of one commodity goes up, all go up.
4) Fundamentals by virtue of the fact that they are "known", are
useless.
5) Run prices up until no one will buy and then run them down until no
one will sell, then repeat.
6)
When all your game playing goes wrong and you lose money, run to
Washington and they will bail you out with money from the very
taxpayers you fleeced so you can go back and do it all over again, and
that's the truth........ |
