It’s the Producers, Stupid!

A new perspective by Chris Cook

For some time now the conventional wisdom has been that commodity market ‘speculators’ are to blame for current high prices across precious and base metals; in most energy markets; and of course in the sensitive agricultural commodity markets where high prices are in many countries a matter of life and death.
This has been propagated by lurid and ill-informed articles in the Press – most notably ‘Daily Mail’ images of tankers full of oil moored off the UK coast. This greedy speculator myth has been taken up by politicians who have driven almost entirely useless action by US regulators in particular.
While the blame for high prices correlated across commodity markets is being firmly ascribed to greedy speculators intent on making transaction profits I do not believe that they are to blame. Read article here