Wall Street Breakfast: Must-Know News [View article]
Re: Restricting speculators in commodity markets. There are three types of players in these markets: 1. Businesses (producers and users) who want to stabilize their business and compete on the basis of production efficiency, marketing, or product design. They should come first. 2. Arbitrageurs who recognize that the first group is not interested in maximizing profit in buying and selling, just taking out fluctuations. They provide the grease to make the system work and should also be supported. 3. Speculators who serve little economic purpose. They add volatility to the market and defeat the objectives of the first group. Some is probably needed to round off large imbalances between the producers and users, but in recent years they have taken over some of the markets. Outside of Wall Street, it would be hard to find any fans.
Wall Street Breakfast: Must-Know News [View article]
1. Businesses (producers and users) who want to stabilize their business and compete on the basis of production efficiency, marketing, or product design. They should come first.
2. Arbitrageurs who recognize that the first group is not interested in maximizing profit in buying and selling, just taking out fluctuations. They provide the grease to make the system work and should also be supported.
3. Speculators who serve little economic purpose. They add volatility to the market and defeat the objectives of the first group. Some is probably needed to round off large imbalances between the producers and users, but in recent years they have taken over some of the markets. Outside of Wall Street, it would be hard to find any fans.
Wall Street Breakfast: Must-Know News [View article]