Monday, February 14, 2011

Pen Meets Paper Feb.14"10

Opinion by Helge Nome
I used to have a small orange orchard while living in the tropics in Australia. The trees grew in sandy marginal soil with few naturally occurring plant nutrients readily available to the trees. For that reason, some trees had a hard time making a go of it if they missed out on irrigation water or sufficient fertilizer from time to time. A very obvious pattern emerged: Those trees that were weak were attacked by aphids and a black sooty mold to a far greater degree than the strong trees were. The same pattern occurs in the animal world where ticks are found in great numbers on weak individual animals in the domestic cattle and wild moose populations here in Canada, for example. These blood sucking parasites take advantage of the inability of the host to defend itself from their onslaught.
Regrettably, in human society, this pattern is repeated, not just by tiny parasites taking advantage, but also by humans preying on humans. We look back at the Viking age and shake our heads as to what some people would do to others without any provocation other than perceived opportunity.
Today the scale of parasitism has changed, but not its nature. The tools are different but the end result is the same: The strong preying on those that are least able to defend themselves. In our world the primary tool for doing this is a deregulated financial system that allows rampant speculation to cause wild fluctuations in prices of goods and services, including essential ones such as energy, shelter and basic food stuffs. The predators have arranged things to win both ways; when prices go up and when they come down. They use the doctrine of the “free” market to justify what they are doing while all the while manipulating that market vigorously to their own advantage. The mechanics of the process is something like this: Being effectively able to create new money at will, the manipulator will focus on a commodity, like oil, wheat or whatever, and buy, buy, buy, on the open market creating a band wagon effect with other speculators falling into line and helping prices increase: Everybody goes “long” anticipating increasing prices. Now, at the same time the manipulator develops a “short” position, betting that the prices will fall at a certain point in time. And that’s pretty easy to do because you decide when you are going to dump what you have bought back onto the open market. So you make money on the way up and you make money on the way down with no risk attached because you control the timing and amount of the rise and the fall in the market price of the commodity. And there is no physical movement of the commodity involved, just ownership, at present or in the future.
And who pays the ultimate price for this gambling? Mostly those that live on the breadline and have to fill their stomachs as best they can no matter what the price of the commodity, like wheat for example. That’s what is happening right now in the Middle East. The consequences are predictable, as we can see and hear on the daily news.

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