Wishful thinking at the Economist

In 1990, the former Wall Street trader Jim Rogers (interviewed here by Jonathan Davis, 15 March) set off to circumscribe the globe astride a large motorcycle. He returned in 1992 having pondered the meaning of life — and the answer was ‘commodities’. As a player of markets, he did not have to do anything so practical as to go out and drill or mine. He just kept buying more commodity futures — a gigantic bet that commodity prices would rise. He was right, and became hugely wealthier as a result.

But as the price of oil, the world’s most essential commodity, continues to rise, listen for the sound of market ideologies creaking under a weight they cannot bear: for example, in the Economist’s editorial last week. ‘Speculators do not own real oil…[They] may raise the price of “paper barrels”, but not of the black stuff …inventories are not especially full just now and there are few signs of hoarding.