Friday, November 07, 2008

The Crisis & The Pepper

This has been a tough year for the Pepper market operators.
After early rise in prices, peaking in February, market started its descence in a setady and solid path which culminated in October whith the world crisis and the Dolar volatility.
Commodities suffered too and the crisis is said to be the worst since the 29 bankruptcy.
However some points deserve a more detailed consideration.
This crisis is essentialy a monetary crisis - lack of moneys. But what moneys ? The fake ones - virtual moneys that did not exist - actualy never existed. Just promises of payment.
There´s a need to separate the physical from the virtual. Sure, jobs and salaries will be lost and the consumption will be reduced to a degree. The consumption of luxury articles will suffer as well as housing, cars, and other big value items. But we do not see the food industry or pharmaceutical, or any other for primary needs to suffer in the same extent as the rest. People will still eat - even because it´s the cheapest expense. To put all the produce in the same basket is an error or can one imagine the guns industry reducing prices due to lack of demand?
There´s life beyond futures trading...
The problem is that such catarse open doors to speculators to manipulate the markets.

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