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  • From: "Lawrence F. London, Jr." <venaurafarm@bellsouth.net>
  • To: permaculture <permaculture@lists.ibiblio.org>
  • Subject: [permaculture] Current rise in food prices, causes Re: Full Attention: A Modest Proposal for Free CSA Shares
  • Date: Tue, 27 Dec 2011 14:28:18 -0500


Wall street investment speculator cockroaches at it again...as usual.

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Wired Science
http://www.wired.com/wiredscience/2011/10/food-price-rises/
Biofuels, Speculation Blamed for Global Food Market Weirdness
By Brandon Keim October 5, 2011 | 5:52 pm | Categories: Energy, Food

A new analysis of sudden rises in global food prices puts the blame on biofuel policy and mortgage-meltdown-style speculation, which may have fundamentally changed how food markets function.

Many other explanations have been proposed, and the latest analysis — a series of mathematical models and statistical evaluations that seem to match theory with real-world patterns — is not conclusive. But it does make a strong case.

“There’s a literature of a hundred-plus articles, saying this might be the cause, or that might be the cause,” said network theorist Yaneer Bar-Yam of the New England Complex Systems Institute. “We looked quantitatively, and found two important factors. Speculators cause the bubbles and crashes, and ethanol causes the background rise.”

Bar-Yam and the NECSI team, whose analysis was published Sept. 21 on arxiv, work at the intersection of social phenomena and network analysis. In earlier research, they’ve explored the global economy’s changing structure and early-warning signals that may precede crashes.

More recently, they’ve studied how social unrest may have been fueled by food price spikes in 2008 and again in 2011. It’s not only the rise in food prices that’s proved troubling, but the rapidity. Shifts have been big and sudden, in stark contrast to the generally slow fluctuation of food prices since the mid-20th century.


Among the possible causes put forward by economists are drought, meat-intensive dietary habits and market hypersensitivity to supply and demand. Another is corn-based biofuel: In less than a decade, some 15 percent of the world’s corn production has been converted from food to fuel. Perhaps most controversially, some economists have blamed a flood of speculators betting on the rise or fall of food prices.

Speculating on food isn’t new, but it was long restricted to farmers and companies involved in food production. For them, speculation was a classic form of hedging: A farmer could, for example, make a bet that crop prices would fall. If they didn’t, he’d benefit from his harvest’s high prices; but if they did fall, winning his bet would offset the losses. Speculation was, on the whole, a stabilizing force.

In the late 1990s, however, a financial industry-led push for deregulation — which would later result in the Enron debacle and the California energy crisis, and the 2008 mortgage meltdown — changed how food speculation worked. Anyone could participate. Bets on food were suddenly made by investment companies who could package and repackage their bets into the sorts of derivatives made famous by the mortgage crisis.

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On 12/27/2011 2:17 PM, Lawrence London wrote:
Full Attention: A Modest Proposal for Free CSA Shares
http://www.fullattention.blogspot.com/2011/12/modest-proposal-for-free-csa-shares.html

what about a scheme to offer them work on the farm, perform other needed
services, barter in exchange for food

to give it away to people who can work with expenses paid by donations from
others seems strange
to give food away to those who cannot offer work or other services is
another matter - plant 6 acres, give harvest from one away

I want Paul to turn this into another podcast






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