This is a fascinating story of the power of the warehouse, a deceptively simple space which Goldman Sachs has been using quite cleverly to manipulate (that is raise) global aluminum prices. Basically, they are shuffling around a quarter of the global supply (1.5 million tons) between buildings in Detroit as a way to create artificial scarcity.
This isn't actually illegal, just sleazy and harmful to the global public.
"In the meantime, the Federal Reserve, which regulates Goldman Sachs, Morgan Stanley and other banks, is reviewing the exemptions that have let banks make major investments in commodities. Some of those exemptions are set to expire, but the Fed appears to have no plans to require the banks to sell their storage facilities and other commodity infrastructure assets, according to people briefed on the issue."
Whatevs. Good thing we have a useless financial regulatory structure in the U.S., no?
Not least interesting is some long overdue attention paid to the impact of speculation on commodity prices, particularly oil. When prices spiked several years back the claims at the time was that it was entirely due to peak oil and had nothing to do with speculation. Turns out this wasn't the case. But prices haven't dropped, have you noticed? This seems to me (having filled my usual 50 dollar tank this week) to be a weirdly silent issue.
A nice confluence of my interests in warehousing strategies as a means of controlling both space and time in global trade, and the whole realm of strategizing raw materials. If you want to read my new piece about nineteenth century warehousing (and you know it is tempting) then see the most recent World History Bulletin. For some reason, the new issue is not online yet, but if you want to read it, email me and I'll send you a copy.
I've been thinking a lot about strategic materials. I've been fortunate to have become involved with a group of historians from around the globe who are interested in these issues, called the History and Strategic Raw Materials Initiative. I presented at their conference in Glasgow last month and it has had a really welcome impact on my thinking about my current book project on jurisdictional aspects of U.S. foreign trade policy. It turns out that framing questions relating to strategic materials opens up a lot of new policy making that I had not really delved into fully before.
This isn't actually illegal, just sleazy and harmful to the global public.
"In the meantime, the Federal Reserve, which regulates Goldman Sachs, Morgan Stanley and other banks, is reviewing the exemptions that have let banks make major investments in commodities. Some of those exemptions are set to expire, but the Fed appears to have no plans to require the banks to sell their storage facilities and other commodity infrastructure assets, according to people briefed on the issue."
Whatevs. Good thing we have a useless financial regulatory structure in the U.S., no?
Not least interesting is some long overdue attention paid to the impact of speculation on commodity prices, particularly oil. When prices spiked several years back the claims at the time was that it was entirely due to peak oil and had nothing to do with speculation. Turns out this wasn't the case. But prices haven't dropped, have you noticed? This seems to me (having filled my usual 50 dollar tank this week) to be a weirdly silent issue.
A nice confluence of my interests in warehousing strategies as a means of controlling both space and time in global trade, and the whole realm of strategizing raw materials. If you want to read my new piece about nineteenth century warehousing (and you know it is tempting) then see the most recent World History Bulletin. For some reason, the new issue is not online yet, but if you want to read it, email me and I'll send you a copy.
I've been thinking a lot about strategic materials. I've been fortunate to have become involved with a group of historians from around the globe who are interested in these issues, called the History and Strategic Raw Materials Initiative. I presented at their conference in Glasgow last month and it has had a really welcome impact on my thinking about my current book project on jurisdictional aspects of U.S. foreign trade policy. It turns out that framing questions relating to strategic materials opens up a lot of new policy making that I had not really delved into fully before.
Comments