Kelly Shockman, Lamoure, N.D., letter: A question for the ages about markets
LAMOURE, N.D. -- Once upon a time, a Farmer Jones went looking for a bull to breed his cows. Farmer Jones found out his neighbor just down the road, Farmer Smith, had a bull for sale. Farmer Jones contacted Farmer Smith and bought his bull for $1...
LAMOURE, N.D. -- Once upon a time, a Farmer Jones went looking for a bull to breed his cows. Farmer Jones found out his neighbor just down the road, Farmer Smith, had a bull for sale. Farmer Jones contacted Farmer Smith and bought his bull for $1,000.
Before Jones could haul his bull home, Smith worried he still needed the bull and, besides, he felt he sold the bull too cheap. Smith contacted Jones and offered him $1,500 to buy back his own bull.
Jones thought a $500 profit on the bull he never even had to haul home was a good deal, so he sold the bull back to Smith for $1,500.
Later, Jones started thinking the bull must really be a good bull if Smith wanted to buy it back, so he raised his offer to Smith for the same bull to $2,000.
Being a sharp businessman, Smith jumped at the chance to make another $500 and sold the bull to Jones again for $2,000.
Farmers Smith and Jones traded the same bull back and forth each time raising the offer for the bull $500, running the price of the bull to $4,500.
Then one day, a farmer from another state looking for a bull heard about this high-priced bull and contacted the last owner, Jones, and offered him $5,000. Jones sold the bull to the out-of-state farmer who came and hauled the bull away.
A few days later, Jones and Smith happened to meet in the local coffee shop. Smith scolded Jones, asking him, "How come you sold the bull to somebody else when we were both making good money on the bull?"
The moral of the story: Do you think it is right for stock traders, commodity traders, speculators and gamblers to be allowed to buy, sell and trade the "fruits of our labors" when they contribute little of the real value to the commodities -- only trading and shuffling paper, often making much more money and profits than the hard-working people who actually produce the commodities?