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Cuchulainn
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Ethical aspects of commodities trading

September 1st, 2008, 2:15 pm

QuoteOriginally posted by: Traden4AlphaQuoteOriginally posted by: katastrofa"They would starve anyway" is a piss-poor defense.I would disagree that it is "piss poor" because this decision making rule is the basis for medical triage. What is the proper ethical decision if taking action A leads to N1 people starving at time t1 and taking action B leads to N2 people starving at time t2? If N1=N2, then we'd probably pick the action that delays the starvation. And if t1=t2, then we'd pick the action that minimizes the number killed. But the general case in which N1>N2 and t1>t2 is not clear. (And we'll ignore the nasty ethic case in which the N1 includes family members and N2 only includes people in another country).We also seem to be ignoring the ethical responsibilities of others. First, a population's demand for food is predictable over very long time horizons. It's no surprise that people will want to eat next year, next decade, etc. Second, the variability of food production and food prices has been known for millennia. Third, contract-based trading of commodities (e.g. futures and forwards contracts) is not some new invention that has been sprung on an unsuspecting populace. These instruments have been used for centuries because the first and second facts are so well known. Isn't it highly unethical that governments have failed to hedge food prices on behalf of their citizens?In the 80's in EU land we had butter slopes, wine lakes and more. Seems to me a bit over the top. NZ got rid of subsidies some time ago, and is more competitive.
Last edited by Cuchulainn on August 31st, 2008, 10:00 pm, edited 1 time in total.
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katastrofa
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Ethical aspects of commodities trading

September 1st, 2008, 7:21 pm

QuoteOriginally posted by: Traden4AlphaQuoteOriginally posted by: katastrofa"They would starve anyway" is a piss-poor defense.I would disagree that it is "piss poor" because this decision making rule is the basis for medical triage. What is the proper ethical decision if taking action A leads to N1 people starving at time t1 and taking action B leads to N2 people starving at time t2? If N1=N2, then we'd probably pick the action that delays the starvation. And if t1=t2, then we'd pick the action that minimizes the number killed. But the general case in which N1>N2 and t1>t2 is not clear. (And we'll ignore the nasty ethic case in which the N1 includes family members and N2 only includes people in another country).We also seem to be ignoring the ethical responsibilities of others. First, a population's demand for food is predictable over very long time horizons. It's no surprise that people will want to eat next year, next decade, etc. Second, the variability of food production and food prices has been known for millennia. Third, contract-based trading of commodities (e.g. futures and forwards contracts) is not some new invention that has been sprung on an unsuspecting populace. These instruments have been used for centuries because the first and second facts are so well known. Isn't it highly unethical that governments have failed to hedge food prices on behalf of their citizens?What "governments" we are talking about in the case of, say, Somalia?
 
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Traden4Alpha
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Ethical aspects of commodities trading

September 1st, 2008, 8:07 pm

QuoteOriginally posted by: CuchulainnQuoteOriginally posted by: Traden4AlphaWe also seem to be ignoring the ethical responsibilities of others. First, a population's demand for food is predictable over very long time horizons. It's no surprise that people will want to eat next year, next decade, etc. Second, the variability of food production and food prices has been known for millennia. Third, contract-based trading of commodities (e.g. futures and forwards contracts) is not some new invention that has been sprung on an unsuspecting populace. These instruments have been used for centuries because the first and second facts are so well known. Isn't it highly unethical that governments have failed to hedge food prices on behalf of their citizens?In the 80's in EU land we had butter slopes, wine lakes and more. Seems to me a bit over the top. NZ got rid of subsidies some time ago, and is more competitive.I do agree that subsidies make a country less competitive (on average) by misallocating investment between ag and non-ag sectors and within the ag-sector (distorting acreage devoted to crop X). Yet, I wonder about the other side effect of subsidies.These days, the excess wine is converted to ethanol for cars. I'd imagine that butter could run a gas turbine powerplant if the locals don't mind the smell of butterscotch. These biofuels may be horribly non-green, but they probably do serve a purpose in buffering food production by providing some economic return for higher-than-expected output. Thus, subsidies encourage higher-than needed average production and provide inventory that buffers the system against the down-side tails of food production levels. Has the reduction in food subsidies led to a rise in food price volatility?The larger problem is that the rich countries can afford fluctuating commodity prices and the poor countries cannot. If the price of wheat doubles, people in the EU and US may grumble about another fraction of 1% of inflation, but nothing bad really happens (e.g., the death rate remains the same). Percent of income spent on food in developed countries is both low and elastic (e.g., by eating more potatoes and eating less air-freighted organic free-range heirloom beef). If the price of wheat drops by half, the farmers in the EU and US may grumble about profits, reduce acreage or switch crops, but nothing bad really happens. Such is not the case in the developing nations, where both consumers and farmers live much closer to the line between life and death.Again, I would argue that speculators generally help buffer prices. But that doesn't mean that average prices will stay low or that spot prices will stay affordable to everyone. I can't see any scenario (except massive depopulation or economic depression) that would let food and oil prices return to what they were a few years ago.
 
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Traden4Alpha
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Ethical aspects of commodities trading

November 4th, 2013, 7:23 pm

QuoteOriginally posted by: outrunI (the commodity) am starting on a project at a bank and they have outsources the payment services to a mediator. A friend and I were signing all these documents, and one was about all the basic information like company name, vat number etc. We had to sign at the bottom, but then my friend noticed it said somewhere hidden inside a large block of text "I agree that I want to get paid within 8 days instead of 30 days for a 3% fee"..Bunch of assholes. That's a 63% annual credit rate! Trying to sign me up using a dark pattern..so I browsed and some law on the FSMA website,.. and as expected that's illegally high and if I report them they'll get fined. What a great 1st day!Put a line through the offending text, initial it, and hand it in. If they try to charge the fee, take them to court where they will be forced to produce the modified contract.
 
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Cuchulainn
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Ethical aspects of commodities trading

November 4th, 2013, 7:26 pm

QuoteOriginally posted by: outrunI (the commodity) am starting on a project at a bank and they have outsources the payment services to a mediator. A friend and I were signing all these documents, and one was about all the basic information like company name, vat number etc. We had to sign at the bottom, but then my friend noticed it said somewhere hidden inside a large block of text "I agree that I want to get paid within 8 days instead of 30 days for a 3% fee"..Bunch of assholes. That's a 63% annual credit rate! Trying to sign me up using a dark pattern..so I browsed and some law on the FSMA website,.. and as expected that's illegally high and if I report them they'll get fined. What a great 1st day!Is dat de tussenpersoon die dit probeert te flikken?
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Cuchulainn
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Ethical aspects of commodities trading

November 4th, 2013, 7:40 pm

QuoteOriginally posted by: outrunQuoteOriginally posted by: CuchulainnQuoteOriginally posted by: outrunI (the commodity) am starting on a project at a bank and they have outsources the payment services to a mediator. A friend and I were signing all these documents, and one was about all the basic information like company name, vat number etc. We had to sign at the bottom, but then my friend noticed it said somewhere hidden inside a large block of text "I agree that I want to get paid within 8 days instead of 30 days for a 3% fee"..Bunch of assholes. That's a 63% annual credit rate! Trying to sign me up using a dark pattern..so I browsed and some law on the FSMA website,.. and as expected that's illegally high and if I report them they'll get fined. What a great 1st day!Is dat de tussenpersoon die dit probeert te flikken?Yes it's the mediator -not the bank- trying to make me sign this.First I replaced the text with (in bold) "unfortunately I can't agree to ... because it's 4 times the maximum limited states in article 4 from ..., and hence it would be illegal to sign this."Then I removed it completely and instead of provoking a reaction I'm just going to sit with them and browse to the government website and point it out. That will probably force them to chance it. And we've also informed the bank about this.I used to work with banks and oil as contractor. There was a tussenpersoon but I know that he would be hung out to dry if you told the bank. Just ask the bank for a new one and tell the tussenpersoon to **.
Last edited by Cuchulainn on November 3rd, 2013, 11:00 pm, edited 1 time in total.
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tagoma
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Re: Ethical aspects of commodities trading

November 25th, 2021, 5:32 pm

Image


Anecdotal evidence that commodities are booming again.
 
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tagoma
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Re: Ethical aspects of commodities trading

November 26th, 2021, 8:16 pm

Image


Anecdotal evidence that commodities are booming again.

one cannot say this message did age well....
 
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trackstar
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Re: Ethical aspects of commodities trading

November 26th, 2021, 8:38 pm

Hangover from hell?

But actually looking at this thread, the original ethical question by katastrofa is a good one and worth more discussion.

Do you think that increasing interest in commodities speculation could lead to more people being unable to feed themselves?

Especially given this serious current issue:  Food Security and Covid-19 - The World Bank

and data sets: Commodity Markets - "Pink Sheet Data", "Outlooks", and Special Topics - The World Bank

(Some of you may start throwing stones due to the sprawling inefficient bureaucratic source there, but it's a start.)

The only work I have done in this area was on the use of ICTs in Agriculture in Developing Countries - quite a few years ago. But still relevant.
 
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katastrofa
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Re: Ethical aspects of commodities trading

Yesterday, 7:50 pm

Add to it fuel for heating if you're looking at Norway - vide Collector's recent posts.

I was just giving a conference presentation of my independent research into disparate impact of Covid on ethnic minorities in the UK. Life expectancy at the retirement for say Bangladeshi men will drop by 7 years, as compared to White Brits who lose "only" 3 years. That's it the dystopic, but quite probable, scenario in which cases and mortality rates will remain at current levels (someone from UCLA was showing similar results for the USA and it looked even worse). The ironic part of the epidemic is that to get those 3 years back, thw Whites needs to ensure that the Bangis jump up to them by the whole 7 years. Showing the policy makers bare numbers (but not larger than 10) usually works, so hopefully it will make some impact.