It's not nice to fool Mother Na. . .errr. . . the free market

Discussion in 'Economics' started by TGregg, Jun 1, 2010.

  1. TGregg


    BEIJING (Reuters) – Germany has banned naked short-selling and the United States may block banks from proprietary trading. But China has taken rules aimed at ensuring market stability to new, tastier lengths.

    . . .

    One view is that cash is attracted to unconventional assets in China, such as pu'er tea a few years ago, because of the country's limited investment channels.

    With the stock market in the doldrums and the government clamping down on property prices, vegetables now beckon.

    . . .

    Investors are no strangers to Chinese produce, as witnessed last year when garlic was the country's top-performing asset.

    While soaring garlic prices troubled those looking to spice up their meals, speculation in the pungent clove was largely dismissed as an isolated and humorous case.

    No one in the government is laughing any more.

    Close on the heels of garlic, mung bean prices are up four-fold from a year earlier, black soy beans are looking bubbly and experts warn that corn could be next.

    "Wholesalers are hoarding mung beans, selling me only one sack every time. They expect the price to rise further as demand is too strong," said Liu Guangyuan, 42, a vegetable vendor who sat smoking by his stall at a small market in Beijing.