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If farming worked like this comment presumes, the simple fact that growing things takes time would be a road to financial ruin and nobody could feasibly earn a

If farming worked like this comment presumes, the simple fact that growing things takes time would be a road to financial ruin and nobody could feasibly earn a living doing it. Since there exist both farmers and food, one can conclude that this isn't how things work. Instead, rather than planting today and selling "here's X bushels of wheat I've harvested" months in the future and hoping for the best, farmers sell futures (that is: "in <growing time> months, I shall deliver X bushels of wheat") for most of their expected yield. Lo' and behold, here's what the futures prices looked like around planting time [1: look at YTD]: high due to demand from those that had expected to have Ukrainian wheat to buy after the harvest, and then back down when that price signal resulted in sufficient wheat being planted to satisfy demand and thus an increased supply of farmers writing futures on it. [1] https://www.nasdaq.com/market-activity/commodities/zw https://www.nasdaq.com/market-activity/commodities/zw

s1artibartfast 4y ago
To be fair, there are a lot of ag goods that don't have futures markets
- bombcar 4y ago
  All hail the mighty Onion. https://en.m.wikipedia.org/wiki/Onion_Futures_Act https://en.m.wikipedia.org/wiki/Onion_Futures_Act
  - cwillu 4y ago
    Obligatory https://astralcodexten.substack.com/p/the-onion-knight https://astralcodexten.substack.com/p/the-onion-knight Edit: damnit, it's subscriber only; here's an excerpt My cryopod popped open, revealing a man in a silver jumpsuit. "Welcome to the future! Here's your onion." [...] The brain's first strike had decimated the human populace. A few survivors, remembering the AI's blind spot, had made it to the onion capital of the world - Vidalia, Georgia. There a biohacker had used the last working CRISPR systems to create a strain of colossal onions, hundreds of feet in diameter. The remnants of humanity huddled inside their onion domes, ignored by the triumphant machines. The next steps required the ability to move freely, outside the domes. In the dying years of the human economy, people had experimented with tokenization of regulated products. Casinos had tried to argue that their customers weren't gambling with money, they were merely gambling with tokens that could be trivially exchanged for money. Decentralized financial markets insisted that sure, you had to have a license to trade stocks, but they were just trading tokens that could be trivially exchanged for stocks. The government hadn't bought it: any token representing an object is legally equivalent to the object. So the huddled remnants of humanity set out turning people into a token representing onions.
  - enkid 4y ago
    And motion picture box office receipts. Fascinating.
  - xapata 4y ago
    Planet Money had an episode about that recently. https://www.npr.org/sections/money/2015/10/14/448718171/episode-657-the-tale-of-the-onion-king https://www.npr.org/sections/money/2015/10/14/448718171/epis...
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s1artibartfast 4y ago

To be fair, there are a lot of ag goods that don't have futures markets

bombcar 4y ago
All hail the mighty Onion. https://en.m.wikipedia.org/wiki/Onion_Futures_Act https://en.m.wikipedia.org/wiki/Onion_Futures_Act
- cwillu 4y ago
  Obligatory https://astralcodexten.substack.com/p/the-onion-knight https://astralcodexten.substack.com/p/the-onion-knight Edit: damnit, it's subscriber only; here's an excerpt My cryopod popped open, revealing a man in a silver jumpsuit. "Welcome to the future! Here's your onion." [...] The brain's first strike had decimated the human populace. A few survivors, remembering the AI's blind spot, had made it to the onion capital of the world - Vidalia, Georgia. There a biohacker had used the last working CRISPR systems to create a strain of colossal onions, hundreds of feet in diameter. The remnants of humanity huddled inside their onion domes, ignored by the triumphant machines. The next steps required the ability to move freely, outside the domes. In the dying years of the human economy, people had experimented with tokenization of regulated products. Casinos had tried to argue that their customers weren't gambling with money, they were merely gambling with tokens that could be trivially exchanged for money. Decentralized financial markets insisted that sure, you had to have a license to trade stocks, but they were just trading tokens that could be trivially exchanged for stocks. The government hadn't bought it: any token representing an object is legally equivalent to the object. So the huddled remnants of humanity set out turning people into a token representing onions.
- enkid 4y ago
  And motion picture box office receipts. Fascinating.
- xapata 4y ago
  Planet Money had an episode about that recently. https://www.npr.org/sections/money/2015/10/14/448718171/episode-657-the-tale-of-the-onion-king https://www.npr.org/sections/money/2015/10/14/448718171/epis...

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