Interesting link here. Aside from the “solution” of regulation to prevent a problem like that described in this article, and the fact that the housing bubble was caused by government in the first place, do you think this could happen if the developed world was “mostly free market”? Would also be interested in hearing others thoughts on what forces would help prevent this from happening in a free market world.
What a bunch of crap? There are so many fallacies, athe first being that there is a superhuman mind who can allocate resources more efficiently than a market. It implies that this organization is government. The funny thing is that government caused this problem in the first place. The clowns in Washington DC decided to buy at higher than market prices a bunch of crops to produce fuel from them. Of course they purchased only a small part of the total harvest but on margin it is a lot. The same speculators fronting the money for farmers immediately started selling their contracts at significant premiums to pay for the food to fuel insanity. Prices jumped at the whole sale level which turned immediately into retail prices surging upward. Of course the poor who could not substitute for these products suddenly found themselves without food. So absent the Food to Fuel program none of this would have happened other than inflation increases in prices.
There is nothing immoral in a farmer selling a crop early at a fixed price to buy seeds, fertilizer, equipment, hire labor, etc. The person buying the contracts for the farmers product is a speculator. There is also nothing immoral about that speculator selling thier property (the contract) to someone else. So the whole argument Goldman or some German Bank is at fault is ridiculous.