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Politics : Politics for Pros- moderated
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To: Brumar89 who wrote (413284)2/26/2011 2:51:58 PM
From: Katelew1 Recommendation  Read Replies (1) of 794176
 
I don't like the mandates and agree it's creating a misallocation of resources, but the whole of bio-fuel production isn't big enough yet to cause the price movement the world has experienced for the last 6 mos. or so. Weather related crop losses were much bigger this year, but even they weren't correlative with the price movement.

Looking ahead, I'm more concerned right now with the role of ETFs. Second is concern with ICE, the International Commodity Exchange based in London. It operates somewhat independently of the CME, Chicago Mercantile Exchange. The result is lax enforcement on position rules and allowing hybrid forms of swaps to circumvent the rules. A lot of hedge fund money buys and sells on ICE, and there's no way to penetrate their activities in real time. Only after the fact.

Let me say again, though, that I'm separating food commodities out of the mix. The reason being that people have to eat every day and can't stop eating to wait for a short term (6 month or so) price movement to revert to the mean.

I trade futures myself and don't really care what these speculative forces are up to as they move from one commodity or group of commodities to the next....except for food commodities.
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