It depends on whether there are any rules or not. If there are rules against fraud and misrepresentation then it would be wrong, unless of course, there wasn't anyone around to enforce the regulations. In that case anything would go. It's sad to say but in our situation we have gone back to the days of the 1920s when there was no regulation of business or financial markets. We saw what the results of free market capitalism were in 1929. It seemed like the mistakes of not regulating the markets had been corrected. However, with the election of Bush it was as if the business community and financial sector was told there were not going to be any cops and that the "market" would do the regulating. Now we have the results of letting the market regulate itself. Cheating, fraud, waste, theft, you name it and we've got it. Just like in the 1920s. We already learned that unregulated markets will boom and that will be followed by ruin. Too bad that the free market utopians were able to have their way again. The country will be paying for not controlling the business and financial markets for years. That is if we are smart enough to do what FDR did after the last big market collapse, put the regulations back in place and then some. We'll see if they have the balls to do that.
While the speculators and manipulators may indeed be working like dogs, its not to keep the situation in hand, it to keep the grift from blowing (and the suckers -- er' investors -- from showing up with ropes, tar, feathers, pitchforks, etc.). Like the old saw says "the first thing to do when you are in the hole is stop digging."
Every time someone kicks over another rock, the problems expand. The scope of this is now bizarre when the face amounts of the derivatives are compared to the total world GDP, the currency trades are compared to the actual physical trades, etc. The tail is indeed wagging the dog.
=========== I'M FOREVER BLOWING BUBBLES -- PRETTY BUBBLES IN THE AIR...
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In another thread, the need for the creation of yet another bubble to offset the losses in the last [real estate] bubble was discussed. Environmental/green related activities were suggested, however it now appears that a commodity bubble started instead.
Is there no way to get this madness under control before it results total collapse? Raise the margin requirements to 100% (in cash)? Raise [and enforce] the bank loan reserve requirements to 20 or 25% (or higher)? Prohibit "naked" short sales in commodities as they do in stocks?
Do you have any idea who is bankrolling the "gang of eight" silver traders, and how? Is this another "heads I win, tails you lose" arrangement where the speculators get the profits and the taxpayers get the losses, i.e. involving federally insured funds such as PBGC/pensions, bank deposits/FDIC, etc?
FWIW -- I live in a rural area [south east Kansas], and the speculation prices for agricultural commodities are *NOT* trickling down to the actual producers. Indeed, the increase in food prices is far outpacing any increase the farmers/ranchers could hope to get when the sell their crops. It appears these commodity increases/"profits" are entirely at the speculator/manipulator level, although the costs (and likely losses) will be assessed against the entire economy/society (in a spirit of "shared sacrifice"). [Question -- why does the public always get to share the losses but never the profits?]
Unka' George [George McDuffee]
------------------------------------------- He that will not apply new remedies, must expect new evils: for Time is the greatest innovator: and if Time, of course, alter things to the worse, and wisdom and counsel shall not alter them to the better, what shall be the end?
Francis Bacon (1561-1626), English philosopher, essayist, statesman. Essays, "Of Innovations" (1597-1625).
Most likely has something to do with the new carbon emissions rules the government trotted out yesterday. It will hit large, smoky industries pretty hard, especially refineries (and especially oilsands refineries), coal-fired power plants, and so on. Costs to these industries could rise a lot, making investments in them less attractive. Here in Alberta people are pretty peeved, but we produce almost half of the stuff being targeted by the feds, too. I think it could slow the superheated economy down some. Probably not a bad idea. With regard to the Euro's rise: Not so much that it's a gaining currency, but that the US dollar has fallen some much on world markets. The Cdn buck has risen against the US but is pretty steady against other currencies. The US with its sub-prime mess and ballooning national debt has investors scared.
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