hypothetical- what would happen if we just banned futures trading?

Jump to Last Post 1-3 of 3 discussions (11 posts)
  1. stclairjack profile image82
    stclairjackposted 7 years ago

    what do you think the short and long term effects would be if we just banned futures trading all together? if speculation is what drives up the price of oil and other commodities artificialy,... then why not ban it and force investors to put thier money into real product.

    1. Marisa Wright profile image97
      Marisa Wrightposted 7 years agoin reply to this

      The same thing crossed my mind during the GFC.  By all means, let genuine buyers place advance orders with conditions, or resell surplus stock before they take delivery.  I'm sure that's how the futures market started.

      I'm sure abolishing the futures market wouldn't stop the speculators doing deals with those genuine buyers in an attempt to make a quick buck.  But the existence of futures exchanges makes it easy for them to do so, and puts a stamp of respectability on it.

      All share trading is gambling, but you are dealing in actual shares in actual companies.  Futures and derivatives are gambling in its purest form.

      1. stclairjack profile image82
        stclairjackposted 7 years agoin reply to this

        agreed

        1. stclairjack profile image82
          stclairjackposted 7 years agoin reply to this

          the reason that the flipping that knolyourself speeks of can ocour soo easily is that only a small fraction of the actual price is needed to secure the purchase of futures,... in some cases as little as 5% of the total market price at that moment,...

          you dont need a lot of money to make or loose money,... if you had to fork over the full sum, .... that would be game changer

  2. knolyourself profile image61
    knolyourselfposted 7 years ago

    Its not the speculation itself, by people who actually buy commodities. Its the huge banks, hedge funds and the like who never take control but merely flip it for profit.

    1. stclairjack profile image82
      stclairjackposted 7 years agoin reply to this

      agreed, it seems that a whole sale reform of our investment system and banking culture needs to be undertaken.

  3. Moderndayslave profile image61
    Moderndayslaveposted 7 years ago

    Perfect,You want to buy 100,000 barrels of oil? When will you be picking it up?

    1. stclairjack profile image82
      stclairjackposted 7 years agoin reply to this

      point taken,... however,... i can arange the purchase of 100 head of cattle three states away and make arangements for them to be picked up in 60 days, all the while taking into account the maintenance fee for them,.... oil does not need to be fed or watered,... so i would assume, (assumption being the mother of all,.. well) that i should be able to actualy purchase said oil while not phisicaly driving up in my 3/4 ton truck with a holding tank in the back,.... yes?

      1. Moderndayslave profile image61
        Moderndayslaveposted 7 years agoin reply to this

        To be honest I have no idea what the answer is.The one thing I do know is that the current system is destroying the little guy that goes to work every day at their job but does not have either the smarts or the money to get in the market. The 5% factor you spoke of is also true,I just used the oil as an example,I read that a barrel of oil was on average traded 27 times during the run up in 2008. This is my opinion :The funds that run up commodities are not adding or creating wealth but rather siphoning it off from the people that  can least afford it, only lining their own pockets. A 30 something  ounce can of Maxwell House coffee was $14 at the grocery store yesterday when it was about $9.00  2 months ago,while gasoline (cheap for us)compared to the rest of the world,gas has gone up $1.50 in about 12 months. I listen to news radio during my commute and they use every BS reason under the sun to try and explain gas price increases. Uncle Ben flooding the world with near worthless dollars isn't helping matters one bit either.

      2. sarahsexpot profile image54
        sarahsexpotposted 7 years agoin reply to this

        You assume that the costs for obtaining oil storing oil and shipping oil not to mention refining oil are fixed and unaffected by geo political factors currency valuation differences and inflation. Don't forget that there are legitimate "speculators" in the markets with an interest in controlling the cost of commodities like oil such as airlines. Let's not forget that "speculators" are also partially responsible for driving prices down at times except then nobody complains.

        1. stclairjack profile image82
          stclairjackposted 7 years agoin reply to this

          no disprespect, but honest curiosity,.... demonstrate for me an instance in which speculation drove down the costof something?,....

          i can understand that purchasing surplus of corn and selling it the next lean season would help the over all price durring the lean season stay somewhat lower,... but the average speculator these days is only interested in making money, not preserving a market,... he/she will sit on thier comodity untill the price is high and sell at the inflated shortage price,... you and i both know it.

          the last speculator that did things such as this for the comon good was joseph

 
working

This website uses cookies

As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://hubpages.com/privacy-policy#gdpr

Show Details
Necessary
HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
LoginThis is necessary to sign in to the HubPages Service.
Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
AkismetThis is used to detect comment spam. (Privacy Policy)
HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
Features
Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
MavenThis supports the Maven widget and search functionality. (Privacy Policy)
Marketing
Google AdSenseThis is an ad network. (Privacy Policy)
Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
Index ExchangeThis is an ad network. (Privacy Policy)
SovrnThis is an ad network. (Privacy Policy)
Facebook AdsThis is an ad network. (Privacy Policy)
Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
AppNexusThis is an ad network. (Privacy Policy)
OpenxThis is an ad network. (Privacy Policy)
Rubicon ProjectThis is an ad network. (Privacy Policy)
TripleLiftThis is an ad network. (Privacy Policy)
Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
Statistics
Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)