Re: Derivatives

["Devine, James" <jdevine@xxxxxxx>]

> 1) If he were advising the government of Cuba would he immediately recommend
> it drop its sugar derivatives program -- and, by extension,  advise other
> poor countries to do the same in relation to their own resources?

I, for one, see nothing wrong with hedging on the futures market to try to "lock in" a price on some -- but not all -- of a country's crop. ("Not all" because it makes sense to diversify.) This kind of "derivative" is what farmers have been doing for quite awhile. It's basically the same thing as taking out insurance.
 
> 2) ... What can be done about what the bourgeoisie itself, notably
> Warren Buffet, describes as a ticking time bomb? Anything? -- 
> a) prohibit the $130 trillion trade in derivatives altogether (fat 
> chance), b) endorse efforts to regulate the the more exotic opaque instruments by 
> requiring greater transparency and mark-to-market accounting standards, 
> or c) wait for the whole house of cards to collapse so we can say "told you so".

It seems to me that (b) is the obvious solution for the bourgeoisie. Not that they'll do it in the near future, because given the current balance of power (the lack of a serious labor or social-democratic movement) the short-term and particularistic thinkers and their neo-liberalism will dominate regulation. 

Jim Devine