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The Onion Futures Act

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Re: The Onion Futures Act

#41

Post by gammateam »

Aloha wrote: post #27
gammateam wrote: post #18

Earlier quoted context omitted.

You can squeeze repeals like these into Budget Appropriation Acts to avoid government shutdowns If you want. Better and faster than the popular vote for different representatives, you dont even have to be registered anywhere. The US Federal Government doesnt have single item veto, and Congress wont care to revisit this even if they noticed later.

What on earth does this have to do with the OP's comment?

> What on earth does this have to do with the OP's comment?

the onion futures act prevents farmers from having agricultural insurance on onion the same way they do on their other crops

the onion futures act can be repealed with very low effort by inserting it into a bill that congress has to pass, such as budget appropriation bills

didn't realize nobody caught that

Re: The Onion Futures Act

#43

Post by S_A_P »

protomyth wrote: post #4
Matticus_Rex wrote: post #3

"In the 2000s (decade), onion prices were significantly more volatile than corn or oil prices. This volatility led the son of a farmer who initially lobbied for the ban to advocate a return to onion futures trading." This is the important part -- ag futures are insurance for farmers. You don't have to get it, but it limits your downside when you do, which is extremely important in low-margin, capital-intensive indust…

Yep, for a decent explanation of hedging ISU has a page https://www.extension.iastate.edu/agdm/crops/html/a2-60.html Note the futures market requirement for hedging.

Work in energy and commodity trading. This is probably one of the best explanations to what is at best a very confusing concept. Thanks for posting

Re: The Onion Futures Act

#46

Post by pg_bot »

jedberg wrote: post #23
pfletcherhill wrote: post #5

The other notorious carve-out is box office futures. Read more about the ban here: https://www.theringer.com/movies/2018/11/15/18091620/box-off...

Interesting! I'd never heard of this. It look like their arguments against it are about the same as the arguments against variable pricing for movies -- the price would reflect overall sentiment and influence the viewership. Why would you go see a movie that is only $1. Clearly no one else wants to see it. In the same vein, why would you see a movie with a bunch of shorts on it?

Yet I don't find their arguments particularly persuasive. You can apply this logic to other products to see why it fails.

Why would you buy a Tesla if there are so many people shorting them?

I could think of a couple ways that you could get people to see a dollar movie. What if you treat it like the dollar menu at McDonalds. The movies are shorter, say like 5-20 minutes but you get a combo of them so you fill up the same amount of time a normal movie would. So you see like 5 short movies for the same price as a normal feature.

I actually think that this might be viable with the rise of the semi-pro youtubers. The movie business already tracks dollars per minute as their metric for pricing content. Reducing length greatly reduces costs so more people could use that as a stepping stone for feature length films.

Re: The Onion Futures Act

#47

Post by joncrane »

jedberg wrote: post #23
pfletcherhill wrote: post #5

The other notorious carve-out is box office futures. Read more about the ban here: https://www.theringer.com/movies/2018/11/15/18091620/box-off...

Interesting! I'd never heard of this. It look like their arguments against it are about the same as the arguments against variable pricing for movies -- the price would reflect overall sentiment and influence the viewership. Why would you go see a movie that is only $1. Clearly no one else wants to see it. In the same vein, why would you see a movie with a bunch of shorts on it?

I disagree wholeheartedly.

Movie tastes are very niche and this is why Netflix makes so many weird/off stuff. But movies right now are like an "all or nothing" proposition so they have to cater to the lowest common denominator.

But if you could do variable pricing, movies could stay in the theaters longer.

Also as recently as 15 years ago there were still "Dollar Theaters" that played past hits and it was totally a fun college-type thing to do to go with your buddies so that that one friend or friends would see it.

I think it would open up a whole new market of bargain-seeking/quirky behavior where the cheaper movies would be like a cult following type of deal.

Re: The Onion Futures Act

#48

Post by quickthrower2 »

21 wrote: post #13

Laws should have an expiration date. Otherwise in 100 years there will be 1 million laws.

How does that work with case law?

For example a case is decided based on an old law, that law has now gone, is that case no longer a precedent?

(IANAL)

Re: The Onion Futures Act

#49

Post by steamer25 »

jedberg wrote: post #24

So I already knew about this from before, but one thing I never understood was instead of banning it outright, why not just put in a rule that says your futures are invalid if you control X percent of the underlying asset?

That was my thought. It seems like it'd be similar to enforcing fractional reserve bank loans--audits and accountants and judges to determine if people are colluding, etc. It also seems similar to anti-trust.

Another possibility might be something like a tax on hoarding large amounts of food e.g., each day it sits around without being sold or consumed past some grace period like one year. Maybe only tax profits achieved by hoarding food, similar to long term versus short term capital gains, unless you sell after a crop failure.

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