Re: [Marxism] Future Currents

["S. Artesian" <sartesian@xxxxxxxxxxxxx>]

1. I am under no such illusion that triple witching hour ended years ago. 
However, the impact attributed to unwinding of positions in these future 
markets had real and immediate impacts on real time markets, so much so that 
regulations, circuit breakers, etc. were deployed to absorb and mitigate the 
impact.  I only provided that example to show that actions in future markets 
can impact real prices.

2. We are not living in a world of supply and demand.  Or more correctly, we 
are living in a world where supply and demand are socially mediated products 
of the world we live in, which is a world of wage labor and capital.  The 
governing factor of supply and demand is the reproduction of the exchange of 
capital and wage-labor, its reappearance as profit. Consequently, it is my 
contention that price inflation has to be analyzed according to how it 
functions in the appearance and apportionment of profit.  Speculation too is 
socially mediated, and is the product, not the producer of the success or 
failure in the reproduction of profit.

3. When there are sudden price breaks, and traders, investors all head for 
the exits, is that a function of suddenly increased supply and suddenly 
reduced demand?  Look at the housing debacle.  What triggered that, 
initially sudden decreases in supply and increases in demand, followed by a 
reversal?  Of course not.  It was a socially generated increase in supply 
and a socially generated increase in "demand," leading to  overproduction, 
reduced profitability, and diminished returns for more than a year before 
the Bear Stearns hedge fund collapses of June/July 2007. Now I know some 
will claim oil isn't housing, but yes it is, they are both commodities-- so 
unless there is an absolute real time physical depletion of the stock, which 
has NOT been demonstrated by anyone anywhere-- even those who claim 
depletion refer to a future peak, the market pricing in a future shortage--, 
then what is happening in the oil markets, and with oil prices, indicates 
one thing, and one thing only-- the conditions an circumstances of 
profitability.

4. To say supply and demand govern price movements is to say basically 
nothing-- it says nothing about the fact that 80% of the territory held 
under lease by the petroleum majors for exploration and developed is 
unexplored, undeveloped.  It says nothing about the fact that petroleum 
inventories have not  been depleted as "demand" theoretically outstrips 
"supply."

5. I would direct attention to the pricing function in the shipping market 
for bulk goods-- the Baltic Dry Index now stands 800% above its 1999-2003 
baseline.  Is there a shortage of such dry-bulk carriers?  No.  In fact 
productivity factors, number of deadweight tons hauled per total capacity 
have declined.  And in 2006 the industry took delivery of ship DWT equal to 
32% of the existing capacity.  Shipping under construction for bulk and 
tanker transport (amounting to approximately 72% of shipping tonnages) is 
expected to deliver, within 5 years, DWT equal to 80% of the existing DWT of 
the world's fleet. Despite the fact the world trade increases at a rate 
usually twice that of gross output, we have price inflation accompanying the 
tremendous run-up to overproduction, and we will see a steep decline in 
rates per metic ton.  I think the price increases in oil are identical, and 
of course precursor, to this run-up to overproduction.

6. JB brings up the stock market collapse and its replacement by the war on 
terror.  I encourage everyone to review and investigate this collapse, to 
try and trace back its origins-- and with a little due diligence we will all 
find that collapse not in any shortage, or in any number of planes crashing 
into any number of towers, but in overproduction and a decline in the return 
of investment precipitated by accelerated capital expansion during the 
1992-2000 period.





----- Original Message ----- 
From: "Joaquin Bustelo" <jbustelo@xxxxxxxxx>
To: <sartesian@xxxxxxxxxxxxx>
Sent: Saturday, July 26, 2008 11:38 AM
Subject: Re: [Marxism] Future Currents



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