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Posts Tagged ‘Gaming the System

Financing World Hunger: How the financial markets create hunger and make huge profits

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“Food is produced by farmers everywhere in the world; but it is mostly bought and sold as commodities by ‘middlemen’, now mostly big corporations that trade globally, not just in a commodities market, but also in an elaborate financial derivatives market that pushes food prices up and creates price volatility.”

The Institute of Science in Society

Dr. Mae-Wan Ho and Prof. Peter Saunders

World food crisis rerun?

Food prices have been rising since 2003. By mid-2008, the food commodity price index peaked at 230 percent of its 2002 value, with most of the increase due to the grain prices. Corn and wheat both reached 350 percent and rice 530 percent respectively of their 2002 values [1]. The United Nations declared 2008 the year of the global food crisis even before prices peaked [2], and an estimated 150 million were added to the world’s hungry that year [3]. Although food prices have fallen from their peak, they remained well above 2002 levels;. By the end of 2009, more than a billion people are critically hungry, with 24 000 dying of hunger each day, over half of them children [3, 4]. The UN Food Programme faces a budget shortfall of US$4.1 billion.

The UN’s special rapporteur on the right to food Olivier de Schutter blames [5] “inaction to halt speculation on agricultural commodities and continued biofuels policies”, and warns of a rerun of the 2008 food price crisis in 2010 or 2011. What happened in 2007-8 was a “price crisis, not a food crisis”, he says, precipitated by speculation in the financial market that was not linked to insufficient food being produced.

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Now we know the truth. The financial meltdown wasn’t a mistake – it was a con

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Hiding behind the complexities of our financial system, banks and other institutions are being accused of fraud and deception, with Goldman Sachs just the latest in the spotlight. This has become the most pressing election issue of all

Will Hutton 18 April 2010 The Observer

The global financial crisis, it is now clear, was caused not just by the bankers’ colossal mismanagement. No, it was due also to the new financial complexity offering up the opportunity for widespread, systemic fraud. Friday’s announcement that the world’s most famous investment bank, Goldman Sachs, is to face civil charges for fraud brought by the American regulator is but the latest of a series of investigations that have been launched, arrests made and charges made against financial institutions around the world. Big Finance in the 21st century turns out to have been Big Fraud. Yet Britain, centre of the world financial system, has not yet levelled charges against any bank; all that we’ve seen is the allegation of a high-level insider dealing ring which, embarrassingly, involves a banker advising the government. We have to live with the fiction that our banks and bankers are whiter than white, and any attempt to investigate them and their institutions will lead to a mass exodus to the mountains of Switzerland. The politicians of the Labour and Tory party alike are Bambis amid the wolves.

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