Africa has gone from being a net exporter of food in the 70s to a massive food importer , around 55 per cent of the developing world are net food importers and almost all countries in Africa are now net importers of cereals , this means they are huge relians on the world food prices for their staple foods and higher prices has a direct impact on their ability to feed themselves ...
That all began to change in the aftermath of the Commodities Futures Modernization Act of 2000, another legacy of the Clinton/Rubin/Summers regime. Of course, the whole basis of the arguments for commodities as a "defensive hedge" non-correlated to financial asset went out the window the minute this legislation was passed. By definition, when managed money flows into an asset class that had previously been uncorrelated with other assets, that asset will naturally become correlated. Hence, by opening up the commodity complex to Wall Street via this legislation, Congress found another potential bubble for Wall Street. Naturally, this garnered huge profits for the investment banks, but ultimately collapsed along with everything else (leaving your average American poorer in the process as usual).
Wednesday, February 9, 2011
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"Those who give up their liberty for more security neither deserve liberty nor security." Benjamin Franklin
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“After there is great trouble among mankind, a greater one is prepared. The great mover of the universe will renew time, rain, blood, thirst, famine, steel weapons and disease. In the heavens, a fire seen.” Nostradamus