Ahh, The Working Poor

[Magox]

you used their short term loss and converted it to more dramatic dollar figures in an effort to show how the market punished them for the bad news as would be reasonably expected...except that it was very short lived. but what of silver? does that not fit into your facts and reason?

No, you made a wild claim, which factually wasn't true, and all I did was show you real numbers. That's how I roll, you know, with facts and reason, not preconceived nonfactual notions of moral justification. Oh and FYI, the reason why it was "short lived" is because oil prices have been heading up and the demand for their sevices have been rising as well, but hey, lets not allow facts to get in the way of your argument.

 

 

Silver? Hunt Brothers? Last I remember, the market corrected itself and the Hunt Brothers were put out of business.

 

But yeah, I get your point.

[....lybob]

No, you made a wild claim, which factually wasn't true, and all I did was show you real numbers. That's how I roll, you know, with facts and reason, not preconceived nonfactual notions of moral justification. Oh and FYI, the reason why it was "short lived" is because oil prices have been heading up and the demand for their sevices have been rising as well, but hey, lets not allow facts to get in the way of your argument.

 

 

Silver? Hunt Brothers? Last I remember, the market corrected itself and the Hunt Brothers were put out of business.

 

But yeah, I get your point.

If by market corrected itself you mean the government intervened then you are correct.

 

 

Once the silver market was cornered, outsiders joined the chase but a combination of changed trading rules on the New York Metals Market (COMEX) and the intervention of the Federal Reserve put an end to the game. The price began to slide, culminating in a 50% one-day decline on March 27, 1980 as the price plummeted from $21.62 to $10.80.

 

The collapse of the silver market meant countless losses for speculators. The Hunt brothers declared bankruptcy. By 1987 their liabilities had grown to nearly $2.5 billion against assets of $1.5 billion. In August of 1988 the Hunts were convicted of conspiring to manipulate the market.

 

One other experience in the silver bubble worth noting, according to author Edward Chancellor ("Devil Take the Hindmost"), is the experience of an official at the Peruvian Ministry of Commerce, employed to hedge his country's silver production, who lost $80 million by illicitly selling silver short. Said Chancellor, "Although a relatively small sum for a sovereign nation, it was an omen: the 'rogue trader' had appeared on the modern financial scene."

[Magox]

If by market corrected itself you mean the government intervened then you are correct.

If you somehow misconstrued what I said as that there wasn't market manipulation, then I can't help you.

 

What I said, which is what I always state, facts, is that the market corrected and they were punished, hence their company going out of business.

[DC Tom]

Which is why I'd have a limit that a company would have to have at least 75% American workers to keep it's ability to participate in the American political process- letting a multinational company who has no vested interest in what's best for America have a say in the political process is no different than letting a foreign government participate in the political process.

 

In other words, you support freedom of speech only for those that have a majority stake in the result of that speech.

 

Not to Godwin the thread...but that's exactly the principle the Nazis put in place.

[....lybob]

In other words, you support freedom of speech only for those that have a majority stake in the result of that speech.

 

Not to Godwin the thread...but that's exactly the principle the Nazis put in place.

The Money=Speech, Corporations= people, argument you make would make Nazis blush with shame.

[boyst]

.....and what am I going to buy locally this time of the year to eat, snow and Icicles? Please don't tell me to can.

Have you been to your local farmers market recently? Most people this year have cupboard full of preserved/canned food and they buy their meats right now. There are still opportunities to buy locally grown produce in the winter, you would be surprised. Check out the link in my sig for more info.

 

What is wrong with canning?

[TPS]

This is a good piece on the impact from indexed commodity futures--a congressional testimony by an investment manager.

Masters testimony

 

With respect to the OECD study, the authors use exchange traded data only, so they miss all of the OTC market, which may be bigger.

[TPS]

This is a good piece on the impact from indexed commodity futures--a congressional testimony by an investment manager.

Masters testimony

 

With respect to the OECD study, the authors use exchange traded data only, so they miss all of the OTC market, which may be bigger.

And here's another study for the Institute for Agriculture and Trade Policy:

My link

 

In particular, see the section on "how much speculation is excessive" on p. 8

[Dave_In_Norfolk]

Imagine is farmers were in Unions. The country...THE WORLD...would be entirely different and starving. Unions are a joke and maybe once had a point, but only maybe.

The farmers basically are one big union. Farm susidizes are a huge deal.

 

If you somehow misconstrued what I said as that there wasn't market manipulation, then I can't help you.

 

What I said, which is what I always state, facts, is that the market corrected and they were punished, hence their company going out of business.

No, he totally busted you there man. You did say "itself" as if the market fixed everything, well, by itself. Squirm all you want, but you are still busted

[Magox]

The farmers basically are one big union. Farm susidizes are a huge deal.

 

 

No, he totally busted you there man. You did say "itself" as if the market fixed everything, well, by itself. Squirm all you want, but you are still busted

Yeah, he got me

[birdog1960]

And here's another study for the Institute for Agriculture and Trade Policy:

My link

 

In particular, see the section on "how much speculation is excessive" on p. 8

the silence resulting from this citation is deafening....sobering stuff.

 

Yeah, he got me

what would the outcome have been in a true libertarian state? the hunt brothers would likely still be counting their growing ill gotten fortunes...but that's ok, right? they would have earned it by playing the game more skillfully!

[Magox]

the silence resulting from this citation is deafening....sobering stuff.

 

 

what would the outcome have been in a true libertarian state? the hunt brothers would likely still be counting their growing ill gotten fortunes...but that's ok, right? they would have earned it by playing the game more skillfully!

your understanding of the markets is lacking to say the least. The Market ALWAYS corrects itself and at some point the buyers won't be there, and the ones buying at the top get burnt.

[Booster4324]

your understanding of the markets is lacking to say the least. The Market ALWAYS corrects itself and at some point the buyers won't be there, and the ones buying at the top get burnt.

 

And the consequences for the rest of us in a market where the government bails them out? Probably missing something, but this question has been bugging me.

[birdog1960]

your understanding of the markets is lacking to say the least. The Market ALWAYS corrects itself and at some point the buyers won't be there, and the ones buying at the top get burnt.

and what happens in the meantime, o great exalted market sage...people pay more for food that they already can't afford? middle class investors in pension funds lose their shirts at the expense of the "real" players?

 

it seems that our lawmakers don't fully understand the markets either. that's why they had a hedge fund manager testifying about commodity price manipulation by speculators and options presented for slowing it. too bad they haven't yet found the wisdom to intervene and stop the exploitation like they did in the hunt bros. case.

Edited January 2, 2011 by birdog1960

[Rob's House]

and what happens in the meantime, o great exalted market sage...people pay more for food that they already can't afford? middle class investors in pension funds lose their shirts at the expense of the "real" players?

 

it seems that our lawmakers don't fully understand the markets either. that's why they had a hedge fund manager testifying about commodity price manipulation by speculators and options presented for slowing it. too bad they haven't yet found the wisdom to intervene and stop the exploitation like they did in the hunt bros. case.

You seem to cherry pick your anecdotes here. First off, Feds catching on to the Hunt bros scheme doesn't necessarily fly in the face of libertarian philosophy. I think you have trouble discerning between libertarianism and anarchy. Nor does a story about the Feds breaking up a scheme to manipulate the market necessarily lead to the conclusion that Fed government intervention into financial markets = good. I recall a few years back a financial meltdown which resulted largely from Federal government manipulation of the markets which had a bit larger ripple effect than your chosen anecdote.

 

It's funny to me how libs love to talk about "shades of grey" yet tend to look at things such as government regulation and corporations in "black and white" terms.

[birdog1960]

You seem to cherry pick your anecdotes here. First off, Feds catching on to the Hunt bros scheme doesn't necessarily fly in the face of libertarian philosophy. I think you have trouble discerning between libertarianism and anarchy. Nor does a story about the Feds breaking up a scheme to manipulate the market necessarily lead to the conclusion that Fed government intervention into financial markets = good. I recall a few years back a financial meltdown which resulted largely from Federal government manipulation of the markets which had a bit larger ripple effect than your chosen anecdote.

 

It's funny to me how libs love to talk about "shades of grey" yet tend to look at things such as government regulation and corporations in "black and white" terms.

well, i certainly agree that shades of grey, as well as blue, red and green play a role in the quality of the actions of a government and would never pretend that they're all good. unfortunately, human nature being what it is, intervention is sometimes necessary to avert disaster. sometimes a government gets it right and too often it does not. that doesn't mean it shouldn't try. to the contrary, it should try harder.

Edited January 2, 2011 by birdog1960

[OCinBuffalo]

1. Every union's existence is based on public perception, not reality. Reality: All workers are not the same. All managers are not the same. Therefore, all workers should not be treated the same, and, all management is not bad. However, the basic premise of a union is that all workers are equal, and should be treated equally, and all management is bad. This is not reality. But, if there are easily framed stories that can be lined up to form a pattern, the union's intended perception is propagated.

 

2. Unions can only exist if they are winning the PR battle that propagates their perception. Stories like this make unions lose the PR battle.

 

3. Trying to deflect the judgment that unions are part of the problem...by talking about Wall Street, is both childish and ineffective.

 

4. Anybody who thinks the public employee unions, and unions in general, don't have a giant target on their backs, is fooling themselves.

 

5. Due to #3-4, anybody who thinks attacking Wall Street, who largely gave to Obama, will somehow save the unions, is going to kill the unions instead.

 

6. The only way through for the unions is: refocus people on their perception. DO NOT talk about other people. Talk about the positive things that the public workers do. Talk about the difficulties/dangers of their jobs. Talk about how they provide the things business needs to succeed.

 

8. Taking a position of negativity, in a sea of negativity, simply gets you ignored. Being ignored is also a Fail for unions, because it does nothing to further the perception that the union must have to exist.

 

9. IF there are fools here and elsewhere that want to keep talking about Wall Street, instead of talking about how the unions will make positive changes, and even more importantly, stay relevant, they must accept the blame when the unions are ultimately destroyed.

 

10. Once again, we will see how "smart" the left really is. If I had to bet, given their performance on every other issue, I would lay money on them f'ing this one up as well.

In other words, you support freedom of speech only for those that have a majority stake in the result of that speech.

 

Not to Godwin the thread...but that's exactly the principle the Nazis put in place.

This Godwin thing is patently ridiculous, and merely a non-argument that is used when a real argument that is based on that history cannot be refuted.

[TPS]

the silence resulting from this citation is deafening....sobering stuff.

 

It's a bit ironic that, on the one hand, someone will spout the power of the market to support a particular POV, but then, on the other, dismiss the impact from increased demand by speculators/investors as not really significant. I wonder what would happen to prices if the current $350 billion "invested" in commodity futures indexes was forced back to the level of 7 years ago ($15 billion)?

[GG]

It's a bit ironic that, on the one hand, someone will spout the power of the market to support a particular POV, but then, on the other, dismiss the impact from increased demand by speculators/investors as not really significant. I wonder what would happen to prices if the current $350 billion "invested" in commodity futures indexes was forced back to the level of 7 years ago ($15 billion)?

 

Why should the total market size matter? It's not like all the extra volume is stacked on one side of the forward position. That would be an interesting net at the end of the day

[TPS]

Why should the total market size matter? It's not like all the extra volume is stacked on one side of the forward position. That would be an interesting net at the end of the day

I'll try this again, the quantity/level of demand matters for any market. If the amount of money flowing into commodity futures (via ETFs) doubles relative to the # of existing contracts, will that not have an impact on prices? It's simple supply and demand. Futures prices are pushed up as new money continuously flows into the markets. The amount of money flowing in has increased by over 2500% in that last 7 years!

 

Net inflows have constantly increased (with the exception of the middle of the crisis as $ fled to safety). ETFs take "long" positions and only "sell" when they need to rollover to new contracts as existing contracts expire. Because of this fixed behavior "smart money" takes advantage by buying during the rollover, as it causes prices to fall; then selling back to the ETFs as they are required to purchase new contracts. I think Business Week had a headline story last summer warning "dumb" investors about the pitfalls of speculating in commodities through ETFs--how you could lose money even as commodity prices were increasing...

 

Add to this that Wall Street banks like Morgan are feeding the flows by becoming "owners" of the underlying commodity, so it allows them to be qualified as hedgers rather than speculators and eliminates their contract limits.

 

It's amazing that some people will argue to their death that doubling the money supply will double prices, but apparently a 2000%-plus increase in demand in a market won't affect prices....