Has the increase in commodities trading raised the price of goods?

2 Comments

1. Hello G says:

   January 31, 2010 at 3:35 pm

   It is very possible. Speculation by people who do not have a stake in the physical product artificially increases demand. Without a corresponding increase in supply, which almost all commodities have relatively fixed short and medium-term supply, prices increase.

   I am sure there is literature on the empirically observed effects of speculation on commodity markets, but the theory is fairly straightforward.
2. Sparky the Greek says:

   February 2, 2010 at 6:18 am

   Absolutely, it drove up tech stocks, the mortage mess and now commodities.

   Hello G, you are spot on!