The
basic necessities in life just keep getting more expensive. According to the latest
data released today by the Bureau of Labor Statistics, year-over-year gains in
some food products at the producer level have been truly spectacular.
● Eggs for fresh use are up 33.9%.
● Pork is up 28%.
● Processed turkeys are up 20.4%.
● Dairy products are up 10.7%.
● Fresh and dry vegetables are up 8.4%.
● Fresh fruits and melons are up 7.5%.
So why is all of this happening?
(1) The Fed has
been on an unprecedented money printing spree, which has dramatically pushed up
the prices of stocks, commodities and just about everything else.
(2)
The
endless drought in the western half of the country is severely hurting food
production.
(3)
The
worst pork virus to ever hit the US.
(4)
Citrus
growers are facing a horrific outbreak of citrus greening disease.
(5)
The
TR4 fungus has hit banana production and may eventually completely wipe out the
variety of bananas that we eat today
Right
now, there are 49 million Americans that are dealing with food insecurity, and
that number will only get worse as food prices go even higher.
You
should be aware of one other factor, a major reason that the prices of not only
food, but oil, electricity, natural gas, and many other basic commodities have
been skyrocketing since 2000 – speculators.
Speculators are traders that
buy and sell pieces of paper, contracts, guarantees – they don’t make or take deliveries
of any products. They only need to have the necessary cash or credit to
participate in the betting process.
The
reason they are involved in the process is to bet solely for a profit. They stand
between the natural buyer and the natural seller of the products they bet on.
This is a multitrillion-dollar, largely unmonitored trading realm existing
outside the regulated exchanges. The prices you are paying at the store or gas
pump are based on the artificial prices created by the betting process, not on
supply and demand. Haven’t you noticed that when you hear a news story about
something that might happen and could affect the oil supply – gasoline prices
immediate go up – even though nothing has happened and the supply of oil hasn’t
changed? The only thing that has
changed are the bets the speculators are making about the price. The prices
the public is paying for basic necessities of life are linked to the prices set
by speculators on unregulated markets -- not
at actual markets where real suppliers deliver real products to purchasers.
Haven’t you
wondered why when news reports about good things are released – prices do not
immediately drop down?
Michael
J. Sandel is the Anne T. and Robert M. Bass Professor of Government at Harvard
University, in his book What Money Can’t
Buy: The Moral Limits of Markets makes some very important points:
The reach of
markets and market-oriented thinking, into aspects of life traditionally
governed by nonmarket norms is one of the most significant developments of our
time. . . Before we can decide whether market relations are appropriate to a
domain, we have to figure out what norms should govern it. . . Markets reflect
and promote certain norms, certain ways of valuing the goods they exchange. . .
We must ask whether market norms will crowd out nonmarket norms, and if so,
whether this represents a loss worth caring about.
The
only way to change this situation is by passing laws that regulate and monitor
these markets – and free basic
requirements for life from the grasp of the speculators. The next time you hear someone shouting “we
need less government regulation” consider the possibility that they may just be
reacting to propaganda that some people who don’t want to be controlled have
been spreading. Inmates at prisons would probably also like fewer regulations
and regulators!
Jim
Myers
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