Lee Pitts: Food Futures
Floating around in my empty head I have more get rich quick schemes than a six term congressman. I was recently discussing my latest ploy to become wealthy without working with a cluster of calloused cowboys who had gathered ’round me at the Beef Palace Restaurant.
“Food Futures,” I exclaimed. “That’s how we are all going to get rich.”
“You’re dumber than a sack of hammers,” said my friend Drip. We call him Drip, by the way, because he is constantly irritating and it’s impossible to shut him off. “They already invented futures markets.”
“No, beer breath, they invented commodities futures markets. I am talking about food futures. Let me explain. Say a Chicago flood trader knew that he was going to be eating ham for Thanksgiving or prime rib for Christmas and he wanted to make sure he got one. I would sell him a ham futures contract for November delivery that would insure that his family would not have to eat turkey for Thanksgiving. But food futures wouldn’t just be for holidays. If a New York Investment banker knew his Anniversary was coming up and he wanted to take his show girl wife out for a hamburger to celebrate, he could buy a Big Mac contract to guarantee they didn’t get stuck with Chicken Nuggets. It would be a hedge against having to eat tofu.”
“Yeah, but what if he got divorced in the meantime and didn’t want to go out by himself?”
“He would have the right to sell his contract to someone else… for a small commission of course. There will be dessert futures, salad futures, glass of milk futures and cookie futures and who better to control them than the ranchers and farmers who produced the food in the first place?”
Drip was warming up to the idea. “Yeah, the first thing the urbanite investor will do every morning is read the Wall Street Journal to see how his December rump roast is doing.”
“And the prices wouldn’t be controlled in Chicago either. Cheese slice futures would be determined in Fresno and pork chop futures out of Des Moines. But the best part is that we would never have to borrow money from bankers again.”
“Why not?” asked Drip.
“Because we get a commission up front for selling the futures and if we need money to buy medicine or fix the truck we just issue a margin call.”
“You mean that if I needed to borrow money to buy a new bull so my cows could have sex on a regular basis all I would have to do is ask?”
“It’s not that simple. What you’d do is leak a story that your bull is shooting blanks and the speculators in New York would worry about their January roast beef sandwich lunch futures and they would beg you to take their money to insure that they got their lunch.”
“What a scam. But aren’t you afraid that you will be handcuffed by the F.B.I. or CFTC?”
“Oh I am sure after the idea catches on that we will have to pay off a few politicians, but it is worth the risk believe me. And the futures industry can’t say that food futures are a bad thing because they’e spent a fortune telling us all how great they are. Farmers and ranchers will finally make a fortune and go around wearing three piece suits all the time.”
“Agriculture might get as good as it was before they invented the darn futures things in the first place,” Drip speculated in a dreamy haze. “And with farmers and ranchers in charge food prices will once again be controlled by supply and demand. What a revolutionary thought!”
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