Recently, Japan and the EU met concerning the continuing global food crisis. Among the conclusions were a determination to continue to partner together to work against food shortages. This comes on the wings of a week where the World Food Programme said that it will not have enough food to even match last year's charity food supplies.
I wonder what continued speculation will do to the market. To date, there has been no rice shortage in the U.S., but amazingly, prices have risen and risen. Every time that I read a article like the one linked above, I get frustrated, there's no supply shortage, but since a few people decided to walk in a different direction (enter Costco and Sam's Club) the whole of the New York Stock Exchange Yuppiedum is in a buying frenzy that upsets supply distribution around the world. Are they doing this because they are worried that Americans won't have enough food?
No, they're buying like mad men because they think that on the short they can turn a few dollars and make money off of people's mania. (Exit Supply and Demand Theory) Resource allocation is a one of the most basic elements of a stable society. Just what is it that we're letting those crazies do to people around the world? Sooner or later we'll need to fess up to the fact that turning that cool million on Wall Street has far more dire impact in the world market than the difference we see here in America, like who can afford the Yukon XL vs. who drives the Hummer without a care.
Let's think America. And get to know you Congressmen by the way!