When Can We Start Breaking Things?

[SoFarSoGood]

You were wrong and it really is as simple as that.

Look you strange animal the futures market is a 'market' like anything else (the clue's in the name). Like any other market the prices rise and fall on supply and demand. It is not there to "ensure an agreed price tomorrow" as otherwise I could buy at any price I wished and the sole purpose of the 'market' would be to 'ensure' I got the price I agreed; it would NOT be a market but a price fixing mechanism and losses would be impossible; supply wouldn't matter a jot.

Whatever your strange ideas of 'evil capitalists' a 'market' cannot "ensure an agreed price tomorrow".

[Major Robert Dump]

Look you strange animal the futures market is a 'market' like anything else (the clue's in the name). Like any other market the prices rise and fall on supply and demand. It is not there to "ensure an agreed price tomorrow" as otherwise I could buy at any price I wished and the sole purpose of the 'market' would be to 'ensure' I got the price I agreed; it would NOT be a market but a price fixing mechanism and losses would be impossible; supply wouldn't matter a jot.

Whatever your strange ideas of 'evil capitalists' a 'market' cannot "ensure an agreed price tomorrow".

You can always have an agreed price on hoes

[gaelic cowboy]

You all will cease your laughter in 6 months when Cheap Food and Quality Hoes opens for business

Steak dinners and beef injections a brilliant combination.

You can always have an agreed price on hoes

[gaelic cowboy]

Look you strange animal the futures market is a 'market' like anything else (the clue's in the name). Like any other market the prices rise and fall on supply and demand. It is not there to "ensure an agreed price tomorrow" as otherwise I could buy at any price I wished and the sole purpose of the 'market' would be to 'ensure' I got the price I agreed; it would NOT be a market but a price fixing mechanism and losses would be impossible; supply wouldn't matter a jot.

Whatever your strange ideas of 'evil capitalists' a 'market' cannot "ensure an agreed price tomorrow".

In simple terms that we can all understand basically.

I the farmer take the short position and you the buyer take the long position, you agree to pay me say 4 euro a kilo for my animals in six months time.

If by the time I deliver the price has gone to 6 euro a kilo then you sell on the open market and trouser a profit of 2 euro, however if by the time I deliver it has gone down to 3 euro then you end up paying me 1 euro over the market rate so you will have lost money.

Basically I'm trying to cover my costs for delivery with maybe some profit on top, while your hoping beef goes way way up so you can pocket a significant profit.

The reason why you cannot just make up a figure is because the margin payments will break you if your priced wrong.
It's also the reason why say a grain farmer might only sell say half his tonnage to a futures trader, he's hoping the price will go up but he is hedging his costs too.

Seán Quinn Anglo-Irish Bank investment

Now this was a CFD but it's essentially the same idea for stocks an shares and it shows how you can lose.

[Papewaio]

Look you strange animal the futures market is a 'market' like anything else (the clue's in the name). Like any other market the prices rise and fall on supply and demand. It is not there to "ensure an agreed price tomorrow" as otherwise I could buy at any price I wished and the sole purpose of the 'market' would be to 'ensure' I got the price I agreed; it would NOT be a market but a price fixing mechanism and losses would be impossible; supply wouldn't matter a jot.

Whatever your strange ideas of 'evil capitalists' a 'market' cannot "ensure an agreed price tomorrow".

Now consider that futures started out in agriculture, I'd listen to the farmer.

The very definition of a futures market is to agree to a future price. It is to smooth out supply and demand peaks and plummets causing massive price spikes and valleys. The idea is to make it more predicatable and hence less risky to all. Of course reducing risk does generally reduce profit margins.

But then again the futures market is really more a long term idea.

"A futures exchange or futures market is a central financial exchange where people can trade standardized futures contracts; that is, a contract to buy specific quantities of a commodity or financial instrument at a specified price with delivery set at a specified time in the future" - Wikipedia

[PanzerJaeger]

LOL @ the 'system' conspiracists. Tell the former executives of Bear Stearns or the Madoff victims that the system is rigged in their favor. Wealthy people can be just as poorly positioned and over exposed as your average idiot facing foreclosure who paid too much for a house based on an income stream with little real security. The reality is that there is no system, no grand conspiracy to extract wealth from the working man. As has already been said, more consumers and more disposable income in the economy benefit wealthy people disproportionately.

No one is entitled to a ‘middle class lifestyle’. Hard work does not equal valuable work. The truth is that you are only as valuable as the value you create. (Value = the amount of money other people will exchange for your labor.)

Everyone is exposed to cyclical economic shifts. That’s just the nature of capitalism. However, if you are still unemployed this many years after the crash or have yet to be able to find a job after graduating, some introspection may be in order. Yes, it could be that old white men in monocles and top hats are conspiring to screw you out of your right to clock in 9 – 5 and earn a ‘decent wage’, or it may be that that philosophy degree was a poor choice.

The problem gripping our economies is not speculation on Wall Street. That was just a symptom. The real problem is that machines are continuing their eclipse of human labor apace. It started in the factories many decades ago, but now it has crept into every realm of the economy. What used to take a department of people collecting and organizing numbers to create can now be done in Excel with a couple of macros. Today, real value is derived from creative, analytical brainpower, and the sad truth is that the average working man has never had an original idea in his life.

[a completely inoffensive name]

No one is entitled to a ‘middle class lifestyle’. Hard work does not equal valuable work. The truth is that you are only as valuable as the value you create. (Value = the amount of money other people will exchange for your labor.)

Oh my bad, I thought humans have an intrinsic value. I was under the impression that, you know, we have rights and such because we value human life in itself.

I guess you are right though, if you can't provide anything to the state of "worth" than why should we tolerate you living in our society? Or at all for that matter?

and the sad truth is that the average working man has never had an original idea in his life.

Such a brave statement.

[Montmorency]

I guess you are right though, if you can't provide anything to the state of "worth" than why should we tolerate you living in our society? Or at all for that matter?

When it becomes easier for the state to eliminate you than to permit you to live in this case, it is something to keep in mind.

LOL @ the 'system' conspiracists.

As I recall, several posters specifically lamented that "it's not even a conspiracy."

The problem gripping our economies is not speculation on Wall Street. That was just a symptom. The real problem is that machines are continuing their eclipse of human labor apace.

Mechanization and computerization are the primary causes of an out-sized global financial market? How do you mean that? Is it that computerization allowed financiers to exponentially increase the number of transactions while presenting the data flood to feed them? Or something more subtle? If the former, well, it seems to imply that the only appropriate solution to problems arising from the financial market is the unacceptable one of primitivism and Neo-Luddism. That would be one mendacious red herring.

[Ironside]

No one is entitled to a ‘middle class lifestyle’. Hard work does not equal valuable work. The truth is that you are only as valuable as the value you create. (Value = the amount of money other people will exchange for your labor.)

Unions forward! Or did you just think that it's the employers who should influence this?

The problem gripping our economies is not speculation on Wall Street. That was just a symptom. The real problem is that machines are continuing their eclipse of human labor apace. It started in the factories many decades ago, but now it has crept into every realm of the economy. What used to take a department of people collecting and organizing numbers to create can now be done in Excel with a couple of macros. Today, real value is derived from creative, analytical brainpower, and the sad truth is that the average working man has never had an original idea in his life.

And your solution is having a large unemployed unhappy underclass? Add some unhappy intellectuals. Pinning for the second communist revolution are you? Or haven't you considered exactly how explosive such a situation is?

Actually, it started with improved agriculture. It's just that there's no other market beyond the service sector.

Mechanization and computerization are the primary causes of an out-sized global financial market? How do you mean that? Is it that computerization allowed financiers to exponentially increase the number of transactions while presenting the data flood to feed them? Or something more subtle? If the former, well, it seems to imply that the only appropriate solution to problems arising from the financial market is the unacceptable one of primitivism and Neo-Luddism. That would be one mendacious red herring.

In general, I would expect more speculations (attempts to create money out of nothing) on top of a relativly shrinking amound of physical products (or clear services). That would create a more unstable market with more crashes. The next one will come before 2020, possibly a few years later due to the severety of the latest one (I doubt that though. The stock markets have mostly recovered).

Of course, there's a lot of other factors involved, but the crashes are fairly predicatable sadly enough.

[SoFarSoGood]

"A futures exchange or futures market is a central financial exchange where people can trade standardized futures contracts; that is, a contract to buy specific quantities of a commodity or financial instrument at a specified price with delivery set at a specified time in the future" - Wikipedia

Ergo if the demand for that future price goes up the price goes up. If I have agreed to pay $X per ton of wheat at Y date and the price goes up... the producer gets more.

[Papewaio]

What?

If I sell a 1000kg of corn as a future at $100 in 3 months. When 3 months comes along I the producer will get $100. Even if the new market price is $50, $200 or a million dollars a ton. I've locked in how much by selling on the future.

What is effected is the next cycle of investment.

[Major Robert Dump]

I actually share a lot of the sentiments of PJ in relation to people expecting something by virtue of merely existing, the lazy feeling entitled, etc etc, although I think he takes it a little too far and is somewhat one sided, almost as if he does not believe there is any one ever who would intentionally sacrifice the financial well being of others for their own personal gain, particularly in the face of knowing our psuedo capitalist government will simply prop them up

And this is my dilemma. How do you fix something with out opening the flood gates of another form of abuse and fraud?. Where is the threshold for such things? In the name of expediencey and disaster relief and racial harmony, was it worth the 1 billion on fraudulant FEMA cards passed out to people who had no ID and gave fake social security numbers? On the other side of the coin, when GM is pressed by the UAW to commit to a pension/retirement policy for its employees that is virtually unsustainable (to the point that retirees were costing more than actual employees) and then the company goes tits up, was it worth it? Exclude the bailout, pretend it never happened and GM went broke and closed down. Was it worth it? Did everyone know all along they would get a bailout so who gives a flying fudge, and if so, why do we think that every company everywhere can offer similar benefits without being propped up? In short, how do you close the floodgate without opening another, how do you punish the bad people without punishing everyone??

Incidentally, I find it highly amusing that the "entitlement mentality" displayed by America's poor and downtrodden, as well as the entitlement mentality displayed by America's corporations, is really just an offshoot of "american exceptionalism", which happens to be another mindset that annoys me.

[Major Robert Dump]

Here is an example of bad copy editing: Almost half of Americans Die Broke.

http://www.marketwatch.com/story/hal...ney-2012-08-29

That is the headline. Then it goes on to discredit itself in its own article.

Half of Americans retirees die with less than 10k in savings. It doesn't say 10k in assets, it says SAVINGS. 10k in savings is actually not too bad if you happen to have your assets paid off, which by retirement age you should. 10k in savings isn't bad considering you probably get social security, you are probably eligible for medicare, you my get disability, you may have a pension, you may have investments and you most likely have assets of some sort or another.

If by retirement you are still a renter, you have no credit lines, you have no assets, then yeah, you are probably in trouble and your problems probably go way, way back due to your obvious lack of preperation.

I would dare say that old people are not the ones in trouble right now.

[Sarmatian]

You guys are forgetting one basic truth -

When an individual goes bust, a bank comes and takes his house, with full backing from the state's legal apparatus.

When a bank (or some other big business) goes bust, the state comes and takes money from individuals and gives it to them to keep them afloat, with the full backing from the state's legal apparatus.


Is it possible that I'm the only one noticing something's wrong here?

[SoFarSoGood]

What?

If I sell a 1000kg of corn as a future at $100 in 3 months. When 3 months comes along I the producer will get $100. Even if the new market price is $50, $200 or a million dollars a ton. I've locked in how much by selling on the future.

What is effected is the next cycle of investment.

More corn! Why? Because it pays more.

[gaelic cowboy]

More corn! Why? Because it pays more.

The futures price doesn't drive the market price it's the actually the market price that drives the futures price.

If grain goes mad dear this year then people will react accordingly with a futures prices that protects them against it going any higher.

[SoFarSoGood]

The futures price doesn't drive the market price it's the actually the market price that drives the futures price.

If grain goes mad dear this year then people will react accordingly with a futures prices that protects them against it going any higher.

What you say is partly true - prices are rising as there is/has been a drought in the US but the reverse is also true, the futures prices (just like normal shares or Government bonds) rise and fall on the amount of the demand from investors.

[gaelic cowboy]

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