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Forum Post: Do you know why the cost of food and gas are so high?

Posted 10 years ago on Dec. 8, 2011, 11:45 a.m. EST by fucorporatemedia (451)
This content is user submitted and not an official statement

In 1991, Goldman bankers came up with a new kind of investment product, a derivative that tracked 24 raw materials, from precious metals and energy to coffee, cocoa, cattle, corn, hogs, soy, and wheat to be known henceforth as the Goldman Sachs Commodity Index (GSCI). For just under a decade, the GSCI remained a relatively static investment vehicle.

Then, in 1999, the Commodities Futures Trading Commission deregulated futures markets. Bankers recognized a good system when they saw it, and dozens of speculative non-physical hedgers followed Goldman’s lead and joined the commodities index game, including Barclays, Deutsche Bank, Pimco, JP Morgan Chase, AIG, Bear Stearns, and Lehman Brothers “You had people who had no clue what commodities were all about suddenly buying commodities,” an analyst from the United States Department of Agriculture told me.

In the first 55 days of 2008, speculators poured $55 billion into commodity markets, and by July, $318 billion was roiling the markets. Food inflation has remained steady since.

Hard red spring wheat, which usually trades in the $4 to $6 dollar range per 60-pound bushel, broke all previous records as the futures contract climbed into the teens and kept on going until it topped $25. And so, from 2005 to 2008, the worldwide price of food rose 80 percent — and has kept rising.

How Koch Became An Oil Speculation Powerhouse From Inventing Oil Derivatives To Deregulating The Market – October 6, 1986: First oil derivative is introduced to Wall Street by traders at Koch. Koch Industries executive Lawrence Kitchen devised the “first ever oil-indexed price swap between Koch Industries and Chase Manhattan Bank. “Documents reveal that Koch is also participating in the unregulated derivatives markets as a financial player, buying and selling speculative products that are increasingly contributing to the skyrocketing price of oil.gas prices

Excessive energy speculation today is at its highest levels ever, and even Goldman Sachs now admits that at least $27 of the price of crude oil is a result from reckless speculation rather than market fundamentals of supply and demand. Many experts interviewed by ThinkProgress argue that the figure is far higher, and out of control speculation has doubled the current price of crude oil. “

http://getsmartnews.com/news/243459

15 Comments

15 Comments


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[-] 3 points by Fedup15 (30) 10 years ago

The main reason is the mandate by the government to put ethanol into the gas formulation. Ethanol is derived from corn, so corn supplies are streched thus prices go up and food prices go up. Corn is a food staple.

[-] 1 points by fucorporatemedia (451) 10 years ago

That certainly doesn't help, however the cost of wheat, for instance, has gone from $4 to $25 based on speculation alone.

[-] 1 points by Fedup15 (30) 10 years ago

Also weather patterns effecting crops and global demand

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[-] 1 points by fucorporatemedia (451) 10 years ago

Goldman Sachs is ripping everyone off- this is the way to reach the rest of the 99% who are not getting it.

[-] 1 points by whisper (212) 10 years ago

Interesting post, though I found the large text offensive. I think one thing should be pointed out though. It was not the 'deregulation' that caused the huge increase in derivatives trading but uninformed investment. There were many who saw that something was making money for someone else, didn't understand how it worked, and tried to play the same game. I am also unconvinced that this is the reason for the increase in food and gas prices. I'm more likely to go with a Rothschild empire conspiracy (not saying it isn't true, I haven't done the required research + it sounds plausible) on that one.

[-] 1 points by fucorporatemedia (451) 10 years ago

'I found the large text offensive'

Sorry, I have no idea how to do that, or how I did that...thought it was meant to be or something.

[-] 1 points by fucorporatemedia (451) 10 years ago

I don't think that most people realize they are being jacked every day.

THIS might wake the rest on the right, because after all, one thing a conservative loves is hoarding money. If they found out they are being jacked by Goldman on their food, with a derivative they arrogantly named after themselves...

[-] 1 points by quisnosonoftherepublic (2) from Caldwell, ID 10 years ago

Ok now to the next point. . food plants are being and have been engineered by Monsanto, a part of the mega corp system which makes seeds and foods that have insect dna in them. monsanto is now putting out GE seeds which can grow in the specially manufactured soils which now have a hard time growing in the old soil. they will replace natural seeds. Laws in place and being put into place keeping individuals from growing their own food. but the true sad fact is that since the 1980's sulfur dioxides ,aluminum oxides, and barium salts have been put into the commercial and airforces fuels to form chemtrails in our skys to the point that our sun gives this planet 20% less light than it used to. thus affecting our food growth and changing our weather patterns. now that is proven there is one more item i wish to include. the removing of prime growing areas from frmers .In klamath falls are 4000 farmers put off their farms by EPA and the corps of Engineers. Why? because of a trash fish that is not indiginous to the river,. Now if you are a seeker of facts you will check this out others wont care or dismiss my information but the rest of you i ask very seriously Why this is happening. I know the answer but I want you to take the time to find out yourselves.

[-] 1 points by simplesimon (121) 10 years ago

I read everything you just wrote and I have come to the conclusion that you are not quite insane yet. You are about a year or so away from it. Tell ya what. Stop eating food created by Monsanto seeds. Stay inside because even at 20% less light you can still get skin cancer, which apparently also created by Monsanto. And since humans will no longer be able to grow their own food, I suppose the robots that Monsanto is making will do all of that for us, and a completely different species of animal will feed us, kind of like the movie Soylent Green.

And heaven help us for eating trash fish. I just found out right now that there is such a thing. Apparently trash fish have meat but no nutritional value, and they grow in sticks like you find in your grocer's freezer. They are really not fish at all, but breading, made from wheat grown by Monsanto seeds. You see, Monsanto wants to keep us all stupid, tepid, and pliable so that when the aliens come we are nice and fat for them. We are, after all, nothing more than a "farm planet" for the inhabitants of Hex40gh.

[-] 1 points by FrogWithWings (1367) 10 years ago

Wealth extraction 101.

Getting the masses of people to comprehend that their beloved stock market, isn't an evil, as well as publicly owned corporations, isn't easy as many enjoy the shiny trinkets their participation tosses them.

My guess is when the actual cost such wealth extraction brings to all Americans, is weighed by the dividends, the only ones benefiting, and not being viciously harmed, are the conductors/inside traders/elected servants of the financial orchestra that performs "America Bend Over While We Drive" without errors or accountability.

[-] 1 points by quisnosonoftherepublic (2) from Caldwell, ID 10 years ago

Pretty close. but you have to dig further. The real interest in this control lies with the IMF (6 mega banks )who are under the control of the Rothschild empire..What commodities must be controlled to control a worlds population? Simple! food, clothing, and jobs, along with travel i may add. look in the window >USA <youll see these controls being implemented Once you see them now you must look for ways to stop this encroachment. "Freedom is never free justice is only what YOU make it" . "Compassion is your sword and shield to protect you and your family against the coming hoard while intelligence is your armor". learn to become your own hero. be dilligent and with purpose for the enemy approaches your castle . What are you going to do?

[-] 1 points by richardkentgates (3269) 10 years ago

good call.

[-] 1 points by Nevada1 (5843) 10 years ago

Hi fucorp, Good post. Everyone should see this. Best Regards, Nevada

[-] 1 points by trob888 (25) 10 years ago

I think you meant to say inflation.

[-] 2 points by fucorporatemedia (451) 10 years ago

They want you to believe this is a natural result of inflation.

However, this is self interested driven 'inflation' and it doesn't have to be this way.

We have not always allowed this, and it was recent deregulation that allowed it to get this out of control.

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