Commodity Traders Invading the Barter Industry

The news is that paper traders have pulled their money out of the financial markets and put it in commodities, which creates an artificial scarcity of those commodities, which pushes the price up and makes retail prices higher, etc.

The nugget at the end of the article I read was this:

Hutchinson calls for countries to raise interest rates to counter the tide toward further investment in commodity assets. But he fails to ask a simple question: What if the owners of the commodity assets also think the same – why do they want the fiat currencies in exchange for their commodity assets?

If the situation were to develop to that point, we would have witnessed the end of the fiat-currency era and a move toward a new international monetary system based on barter trade.

What Hutchinson failed to notice is that barter has been a long time piece of the monetary system. Consider that when companies want things from each other, but their governments are at odds, they barter.

What it means for the barter industry is another large scale feet-in group entering the barter arena. What are all of those commodity owners going to do with the commodities if the price they want fails to appear? Barter.

Have fun barter industry! More players are coming your way.

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