Famine...and Greed

Have you met Rebecca? If not, you’ve yet to meet a fascinating individual...and a wonderful writer. It’s not too late to get to know her. Why not start with her latest post?

Funny how wheels and cogs, however far apart, spin and intermesh.

I’ve been rather quiet, lately (sorry about that). It’s not that my mind has been somnolent. It hasn’t been. It has never been (I doubt it ever will be). I’ve been distracted, ailing. In regards to my own life, my own bedraggled heart, well, there’s been a modicum of tranquility. The worst is behind me. I’ve come to accept my failings. I’ve done my penance. I’ve been bloodied and humbled (deservedly so). I’ve been healing. I would be most grateful, truly, if my immune system would eventually read the memo...

But this entry is not about me. It is about famine and greed. Rebecca lit the fuse. The photograph she posted (and the accompanying narrative) arrived at the very same time while I had been contemplating financial matters...investments...the price of vital commodities...and the resulting consequences.

I had been contemplating the price of grains and oil and minerals...
the necessary ingredients for human survival or development. I had been delving into the bowels and arcana of commodities trading, the data regarding supply and demand, the yin/yang of commerce.

And, then, Rebecca offered her thoughts...and a photograph. The caption beneath that gut-wrenching image of a starving child and hopeful vulture tore through my heart and reduced me to tears.
The caption reads:

“The picture depicts a famine stricken child crawling towards a United Nations food camp, located a kilometer away.

The vulture is waiting for the child to die so that it can eat it. The picture shocked the whole world. No one knows what happened to the child, including the photographer Kevin Carter who left the place as soon as the photograph was taken.

Three months later he committed suicide due to depression”

I read the news today, oh boy. I’ve learned that the soaring prices of grains are fueling famine around the world. Famine’s nothing new. We’ve seen famine strike after years of drought. We’ve seen the horrors of famine inflicted as a weapon of war. Famine’s shadowed humanity throughout all of recorded history. Its skeletal hand has touched many.

Today, as I sit at my computer, window open wide, sunlight and breezes dancing all around, I know that people are starving. Young children, as young and innocent as that Sudanese child, are starving to death...suffering an extraordinarily painful demise.

Now, what if I told you...what if you knew?...that there is enough wheat in the United States, right now, in storage, to feed every man, woman, and child all the bread, pasta, and baked goods they can eat for the next two years - about 1.3 billion bushels. Yet wheat has soared in price...

While children are starving...while vultures wait.

Yes, in fact, wheat and corn and rice and all the grains essential for human survival in every nation, village and primitive hut across the globe are available, right now...in storage...beyond the reach of the impoverished and desperate.

And children starve...and vultures thrive.

We, we humans, have starved our fellow homo sapiens in horrific acts of war or crazed despotism. We, we humans, suffer when the rains disappear, loam turns to dust, and the sun mercilessly flogs each desperate sprout to death. We’ve been horrified. We’ve tried to help. We’ve cried out in anger and shame about fate and wars and the damage done...and all the suffering....the ineffable suffering.

But this is something new.

This time, “institutional investors” via large commodity index funds, are inflating the price of foodstuffs. Who are these institutional investors? Well, they’re Corporate and Government Pension Funds, Sovereign Wealth Funds, University Endowments and "hedge" funds. These “investors” now account for the largest share of outstanding commodities futures contracts, far outspending any other market participants. These “investors” are greedy speculators. These “investors” have absolutely no desire to actually purchase a single bushel of wheat or bag of rice. These “investors” step in between the producers and the consumers and simply bid the prices higher...in order to profit...

While children starve...and vultures salivate.

This is something new. There was always a valid reason for commodities futures trading and “hedging” (by the way, several hedge fund managers 'broke through' the billion dollar annual compensation 'barrier' last year). These practices once served to protect both producers (farmers) and customers (grocers) from the vicissitudes of Nature and Fate. The commodities futures “industry” has grown over the years, to be sure. At the end of 2003, $13 billion flowed into commodity index funds. Then, something truly ugly happened. “Institutional investors” those same institutions that had lost so much by gambling so recklessly with subprime mortgages and all of the resulting “innovative” financial instruments that proved to be...well...so reckless and worthless, decided they had to shore up their losses by investing/speculating in the commodities markets. By March of this year, the dollars “invested” had grown twenty times, to $260 billion. And the price of oil quintupled...and corn and soybeans and wheat and rice became too expensive for purchase by the poor.

And children starve...and vultures feast.

About a billion more dollars flow into commodity index funds each and every day. Each new dollar pushes the price of a grain of rice, an ear of corn and a kernel of wheat just a little bit higher...just a little bit farther from the reach of the pleading, struggling, desperate hand of the starving child...while the vultures patiently wait.

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I’ve done well as an investor. I have. I’ve learned a bit and prospered a bit. But today, as the sunlight dapples my shoulder and the breezes frolic with my hair, I sit at my computer...crying...fighting with every ounce of strength I can muster to keep from screaming...to keep from reaching for the razor in the drawer...

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