Market Fiction

Can a market be defined. No, a market is more a notion than a fact. Many, maybe most, think they know exactly what a market is. Ten people will give you eleven opinions.

Today's spot dairy trading on the Chicago Mercantile Exchange (CME) is a case in point. Block Cheddar fell $0.135 to close at $1.88, a drop of 7 per cent. April Class III futures fell -$0.75.

If there was any evidence of new players running on the the trading floor with new breaking news, it would be one thing. But, it appears to be the usual gang of thugs.

Without significantly different players, what can be said, positively, about the quality of information the main players hold?

The Pie

(click on image to enlarge)

At: http://www.agweb.com/assets/1/6/D10188.pdf
is an interesting presentation.

The fact is the dairy pie is finite, with a limited amount of money. If you believe the above presentation, you might be led to think any and all can be winners. Not so. The game being played is a zero sum game, meaning, for there to be winners there must be losers. "Am I my brother's keeper?" (Gen 4:9)

What is the fate of the losers? Do they disappear, blown away like characters on a video game?

I would hope this year we can put more of an effort into seeing the importance of all in the dairy community.

Futures Down

Today, for the second straight day, block Cheddar on the CME fell. Today, block were down 2 cents and it was not Jerome - try Ted Jacoby.

What is interesting is the crash in futures. On Friday the November 2010 futures were down $0.55. Toady November futures fell another 7 cents.

Easy pickins'.