Loading ...Most of the players, 90%? don’t buy or sell any of the commodities they are “playing”. They never make or take a delivery of any actual THING. Mostly opinions of the future price. Like a frost coming to Florida, the gamblers, assume a shortage, and bet or opinion the prices higher.
The only time supply and demand changes the price, is AFTER a long distorted price causes a shortage or over supply. Look what happened to Oil. Opinion got the price to $145/bbl, resulting in over supply, leading to $26/bbl.
The value of Units Of Accounts, aka currencies, are also gambled on the futures market. My view is its the gov’t tool or method for wage and price controls. They used to just admit it in the ’60s and early ’70s, after that they go thru the futures market. Via Goldman Morgan etc players.
The futures market is only good and useful for the minority 10% that actually make and take delivers, among each other and need a protective hedge or known agreed upon future price.
The masses of players I see them being used as like Shock Absorbers on our cars.
Another thought. T. Boon Pickens, an actual Oil supplier. I heard him say once…..”If I have a million barrels of oil in a tank, and I see prices rising, why should I sell my oil today, when I can sell it two months later for more?”
Another example, of “players” opinionating a higher price, leading to an actual supplier holding back or hoarding his item.