Another Rogue Trader

Inflation Now, or Reagan fucks us again...

Wheat??? Get ready for things like noodles, bread, and any product containing wheat to rise in price about 20% more atop a 5% price rise so far this year. The largest wheat price swing in the history of the CBOT took place today with a swing of $2.70 in a single day. The "normal" limit on wheat has been thirty CENTS for as long as I've been in the business. Wheat hit an ALL TIME high.

Several countries have shut their doors to wheat exports in an effort to spike inflation at home, a clever device which puts even more pressure on a market that sees world wide weather generated shortages in supply. But at the root of the food inflation is world demand. It is fueled by more people making more money than at any time in their lives, and when you make more money the first thing you do is eat better. Communism was great for us, only we didn't know it. Looking at this correctly you would have to say that it was fucking Reagan who is the cause of the current inflation; had he not rattled Gorbachev's cage causing the government to collapse, communism would never have folded and Eastern Europe would have continued to starve.

As another stick of wood on the pyre, we have the fucking environmentalist generated drive to ethanol, a product that is a total fake but has become a part of the trendy Left agenda.

But just like in the crude pits, speculators, hedge funds, and index funds have dived into the market traditionally the home of hedgers (producers of grains). Complicating things is the near absence of "open outcry" trading (now just 6% of total trades) a system that has been replaced by electronic trading. Open Outcry is a trading method the usual academics have decried for years as corrupt and unfair etc., but there is no way that secretive trades made by hedge funds and speculators could have gotten by the floor without everybody knowing what was going on.

Oh, and add to all this is the now usual presence of a Rogue Trader, (where would a runaway market be without a rogue trader to blame?) a guy who traded his own account from a brokerage using firm money for margin and he lost about $140 mln, more or less.

Corn is trading at $5.50 (per bu.) which puts corn at record highs too, and corn is what feeds the piggies and cattle that we all eat.

Feeling anything? Don't pick up the soap....