Best of the Week
Most Popular
1.Canada Real Estate Bubble - Harry_Dent
2.UK House Prices ‘On Brink’ Of Massive 40% Collapse - GoldCore
3.Best Cash ISA for Soaring Inflation, Kent Reliance Illustrates the Great ISA Rip Off - Nadeem_Walayat
4.Understanding true money, Pound Sterling must make another historic low, Euro and Gold outlook! - Marc_Horn
5.5 Maps That Explain The Modern Middle East - GEORGE FRIEDMAN
6.Gold Back With A Vengeance As Bitcoin Bubble Bursts - OilPrice_Com
7.Gold Summer Doldrums - Zeal_LLC
8.Crude Oil Trade & Nasdaq QQQ Update - Plunger
9.Gold And Silver – Why No Rally? Lies, Lies, And More Lies - Michael_Noonan
10.UK Election 2017 Disaster, Fake BrExit Chaos, Forecasting Lessons for Next Time - Nadeem_Walayat
Last 7 days
UK House Prices Momentum Crash Threatens Mini Bear Market 2017 - 21st Jul 17
The Fed May Show Trump No Love - 20th Jul 17
The 3 Best Asset Classes To Brace Your Portfolio For The Next Financial Crisis - 20th Jul 17
Gold Stocks and Bonds - Preparing for THE Bottom - 20th Jul 17
Millennials Can Punt On Bitcoin, Own Safe Haven Gold For Long Term - 20th Jul 17
Trump Has Found A Loophole To Rewrite Trade Agreements Without Anyone’s Permission - 20th Jul 17
Basic Materials and Commodities Analysis and Trend Forecasts - 20th Jul 17
Bitcoin PullBack Is Over (For Now): Cryptocurrencies Gain Nearly A 50% In Last 48 Hours - 19th Jul 17
AAPL's 6% June slide - When Prices Are Falling, TWO Numbers Matter Most - 19th Jul 17
Discover Why A Major American Revolution Is Brewing - 19th Jul 17
iGaming – Stock Prices - 19th Jul 17
The Socionomic Theory of Finance By Robert Prechter - Book Review - 18th Jul 17
Ethereum Versus Bitcoin – Which Cryptocurrency Will Win The War? - 18th Jul 17
Accepting a Society of Government Tyranny - 18th Jul 17
Gold Cheaper Than Buying Greek Villas in 2012 - 18th Jul 17
Why & How to Hedge the Growing Risks of Holding Stocks - 18th Jul 17
Relocation: Everything You Need to do for a Smooth Transition Abroad - 17th Jul 17
A Former Lehman Brothers Trader: It’s Time To Buy Brick And Mortar Retailers - 17th Jul 17
Bank Of England Warns “Bigger Systemic Risk” Now Than 2008 - 17th Jul 17
Bitcoin Price “Deja Vu” Corrective Sequence - 17th Jul 17
Charting New Low in Speculation in Gold and Silver Markets - 17th Jul 17
Bitcoin Crash - Is This The End of Cryptocurrencies? - 17th Jul 17
The Fed's Inflation Nightmare Scenario - 17th Jul 17
Billionaire Investors Backing A Marijuana Boom In 2017 - 17th Jul 17
Perfect Storm - This Fourth Turning has Over a Decade of Continuous Storms to Come - 17th Jul 17
Gold and Silver Biggest Opportunity Since Late 2015, Last Chance at These Prices - 17th Jul 17
Stock Market More to Go - 17th Jul 17
Emerging Markets & Basic Materials Stocks Breaking Out Together - 16th Jul 17
Stock Market SPX Uptrending Again After Microscopic Correction - 15th Jul 17
Global Currency Reserve At Risk - 14th Jul 17
Picking Great Gold Stocks - 14th Jul 17
BBC Tree Expert's Verdict on Sheffield Amey / Labour City Council Tree Felling's - 14th Jul 17
SPX Cycles, Fed Funds and Gold - 14th Jul 17
Should Platinum Be More Expensive Than Gold? - 14th Jul 17
What's Next for US Dollar, Stocks, Bonds and Gold? - 13th Jul 17
India Gold Imports Surge To 5 Year High – 220 Tons In May Alone - 13th Jul 17
Gold and Silver: Your Stomach Is Probably Wrenching Right Now - 13th Jul 17
Gold Industry Is In A Deep State Of Dysfunction, Delusion And Denial - 13th Jul 17
Cryptocurrency Bloodbath! Sell Everything We Were Totally Wrong! - 12th Jul 17
Gold to Silver Ratio - Preparing for THE Bottom - 12th Jul 17
Iran and North Korea: Brothers in Nuclear Arms - 12th Jul 17
Down Dollar Down: Time for "UP"? - 12th Jul 17
Most Tech People Are Too Young To Remember That Silicon Valley Hasn’t Had A Real Crisis In 17 Years - 11th Jul 17
Stock Market Rally May be Over - 11th Jul 17
Silver Price Plunge Is Nearing Completion - 11th Jul 17
Soaring Global Demand for Lithium Presents Triple-Digit Profit Scenario - 11th Jul 17
Gold Price Outlook Increasingly Bullish - 11th Jul 17
Sheffield Street Tree Protestors / Campaigners vs Amey Labour City Council 2017 - 11th Jul 17

Market Oracle FREE Newsletter

3 Videos + 8 Charts = Opportunities You Need to See - Free

The Myth of "Free" Enterprise Economic System

Economics / Economic Theory Oct 29, 2009 - 11:30 AM GMT

By: Robert_Singer

Economics

Best Financial Markets Analysis ArticleFree enterprise, also called free market, is an economy governed by the laws of supply and demand, not restrained by government interference, regulation or subsidy.

Command economy is basically a slave enterprise where supply and price are regulated by the government rather than market forces.
The only thing I will agree with about the “law of supply and demand” is that supply at a downward-manipulated price, can create demand.
Downward manipulation is an uneconomic aberration first discovered in the precious metals market by the noted silver analyst, Ted Butler.


We are conditioned to believe free enterprise supply and demand would lead to inflated prices so the greedy corporations can make more money, but Ted Butler’s research in the silver market concludes the opposite.

The beneficiaries of this type of manipulation are the consumers because corporations can sell their products affordably and still make a profit.

Butler’s investigation has identified JP Morgan Chase, one of the founding members of the Federal Reserve, as the prime suspect, in the “ongoing intentional, not accidental” great crime of keeping the price of commodities low so the middle class can afford the American dream, a nightmare for the planet. [1]

I’ll get right to the point: McDonalds in the 1950s made a profit by selling a product for less than the competition, but a not-so-invisible hand produced cheap calories in great abundance so Ray “Crock” could sell a cheeseburger, fries and a large Coke for a price equal to less than an hour of labor at the minimum wage — and still make a profit. [2]

You don’t eat the hamburger at McDonalds because it’s a dollar: It’s a dollar to get you to eat it.

How did we get a food system that produced what should be a $35 hamburger downwardly manipulated to $1? [3]

"Taxpayer subsidies basically underwrite cheap grain, and that's what the factory-farming system for meat is entirely dependent on," Doug Gurian-Sherman, a senior scientist in the Food & Environment Program at the Union of Concerned Scientists (UCS). [4] 

In other words, the Scoundrels behind the Federal Reserve, Rothschild, Rockefeller, Kuhn, Loeb and JP Morgan Chase, underwrite cheap grain and the factory-farming system for meat, so you can get a hamburger for a dollar.

Our current food system—characterized by monocultures of corn and soy in the field and cheap calories of fat, sugar and feedlot meat on the table—is not the product of any free market but rather the result of a specific set of governmental and monetary policies  (from those Scoundrels at the Fed) and the free gift of fossil fuels from the world’s richest man in history and another founding member of the Federal Reserve, John D. Rockefeller.

He didn’t just give dimes away, he gave away his oil so you could get inexpensive fuel and food.

If you fly over Iowa from October to April you will notice the land is completely bare— black—because you are seeing an agricultural landscape created by cheap oil
from John D.

Cheap energy enabled the creation of monocultures and vastly increased the productivity both of the American land and the American farmer but at the same time, subsidized monocultures of grain also led directly to monocultures of animals.

Since factory farms could buy grain for less than it cost farmers to grow it, they could now fatten animals more cheaply than farmers could.

So America’s meat and dairy animals migrated from farm to feedlot, driving down the price of animal protein to the point where an American can enjoy eating a hamburger or chicken McNuggets for a dollar.

Taking the animals off farms made no economic, environmental or ecological sense: their waste, formerly regarded as a precious source of fertility on the farm, became a pollutant—factory farms are now one of America’s biggest sources of pollution.

As Wendell Berry has tartly observed, to take animals off farms and put them on feedlots is to take an elegant solution—animals replenishing the fertility that crops deplete—and neatly divide it into two problems: a fertility problem on the farm and a pollution problem on the feedlot. The former problem is remedied with fossil-fuel fertilizer; the latter is remedied not at all.

After World War II, the US government pursued a monetary policy, at the direction of the Fed, subsidizing commodity crops by paying farmers (money created out of thin air) by the bushel for all the corn, soybeans, wheat and rice they could produce. One secretary of agriculture after another implored them to plant “fence row to fence row” and to “get big or get out.”

The chief result was a flood of cheap grain that could be sold for substantially less than it cost farmers to grow because a government (Scoundrel) check helped make up the difference.

As this artificially manipulated cheap grain worked its way up the food chain, it drove down the price of all the calories derived from that grain: the high-fructose corn syrup in the Coke, the soy oil in which the potatoes were fried, the meat and cheese in that burger until the price reached a dollar. [5]

ADM Gets Caught Putting Money In The Cookie Jar

“The Informant!” is a movie about the lysine price-fixing scandals that Archer Daniels Midland found themselves in the center of back in the 90s.

ADM was caught fixing the price lysine, an amino acid and very attractive animal feed additive used to make chickens fat, dumb, and happy, back up, after it was manipulated too far down for anyone to make a profit.

Price-fixing is a crime no matter how many people ADM feeds. [6]

From cradle to grave we are brainwashed to believe everything is about profit.

So, in the film, when Mark Whitacre tells the FBI that ADM cheated millions from the consumer by colluding to fix prices, we forget that Americans spend less than 10% of their incomes on food (down from 18% in 1966).  When we eat inexpensive burgers and fries, it’s thanks to ADM downward-manipulating the price of lysine. [7]

Our not-so-free market economy based on consumer products, that is, products we are downward manipulated to want, not need, was never FREE or sustainable. Consumers consume…the resources of the planet.

The huddled masses should be thanking those scoundrels at the Federal Reserve for 60 years of downward manipulating the price of commodities: It resulted in unprecedented prosperity, but don’t forget to blame them because the American dream was an environmental nightmare for the planet. [8]

Footnotes:

[1] The Real Story, By: Theodore Butler, Silver But No Silver Lining, Robert Singer
[2] Farmer in Chief, Michael Pollan, Published: October 9, 2008, Erwan Frotin for The New York Times

[3] Economist Douglas McDonald estimates that if water subsidies were withdrawn from California livestock producers, the income of the state’s other businesses and workers would rise over $10 billion annually (1987 figures).
Other economists have exposed the cost of water subsidies to the meat industry that are hidden in the state’s rising prices for water rights, and thus, housing. Fields and Hur calculate the overall price of subsidizing the California meat industry’s water to be $24 billion (1987 figures). The Food Revolution by John Robbins, President of the EarthSave Foundation.
[4] Time Magazine, Getting Real About the High Price of Cheap Food, By Bryan Walsh Friday, Aug. 21, 2009
[5] In years past, except in the dead of winter, you would have seen in those fields a checkerboard of different greens: pastures and hayfields for animals, cover crops, perhaps a block of fruit trees. Farmer in Chief, Michael Pollan, Published: October 9, 2008
Before the application of oil and natural gas to agriculture, farmers relied on crop diversity (and photosynthesis) both to replenish their soil and to combat pests, as well as to feed themselves and their neighbors. 
[6] Each day, the 28,000 people of Archer Daniels Midland Company transform crops such as corn, oilseeds, wheat and cocoa into food ingredients, animal feeds, and agriculturally derived fuels and chemicals.
The editors of World Watch state that “the human appetite for animal flesh is a driving force behind virtually every major category of environmental damage now threatening the human future—deforestation, erosion, fresh water scarcity, air and water pollution, climate change, biodiversity loss, social injustice, the destabilization of communities and the spread of disease.”
Lee Hall, the legal director for Friends of Animals, is more succinct: “Behind virtually every great environmental complaint there’s milk and meat.”

[7] Archer Daniels Midland has been sued for colluding to fix prices in the citric acid and high fructose corn syrup markets among others, but their most noteworthy violation of the Sherman Antitrust Act of 1890 was the part ADM played in fixing the price of lysine, an amino acid used in animal feed. Lysine is especially good at making chickens fat, dumb, and happy, which makes it a very attractive feed additive. Unlike any other price-fixing conspiracy before or since, ADM's involvement in forming and participating in a cartel was meticulously recorded by a mole inside the organization while the crime was being committed, offering an incredible insight into the nuts and bolts of an international corporate conspiracy. 

[8] A Sure Thing?, Ted Butler Commentary, Silver, but No Silver Lining, Robert Singer

By Robert Singer

Robert Singer is an Entrepreneur and the author of a forthcoming book on the Federal Reserve. His articles cover politics and the financial and environmental implications of our consumer society.  The articles have been main headlined and can be found on numerous popular websites: Marketoracle, Silverseek, Goldseek, Daylife, LAprogressive, Canadafreepress, Opednews, Daily.pk and many of the Wordpress sites. Richard Daughty, The Mogambo Guru, proclaimed him a Junior Mogambo Ranger (JMR)

Dem Bones is Connected To De Debt Bone by Robert Singer, an analysis of the Federal Reserve, can be found on numerous popular websites including G. Edward Griffin’s Unfiltered News. Edward Griffin is the author of,the definitive work on the Federal Reserve, The Creature from Jekyll Island.

Meat, Milk and Motors: The New China Syndrome by Robert Singer, an essay about China first released in February 2009 has been widely posted and read on the Internet. Quotes from the article can be found in The Wall Street Journal Digital Network and the essay was the Top World Story on the Pakistan Daily website for over a week.

© 2009 Copyright Robert Singer - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Robert Singer Archive

© 2005-2017 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife