Discussion: Commodity Price Discovery: Problems That Have Solutions or Solutions That Are Problems
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This paper examines three invited papers focused on commodity prices. Public responses to
high nominal commodity prices and perceived increases in price risk have ranged from attempts
to assign blame, attempts to change contracting arrangements, and development of
public policy that ‘‘protects’’ the market from future occurrences of unacceptable behavior.
Interestingly, a result of increased commodity price volatility has suggested that futures
markets no longer ‘‘work.’’ This is ironic given that futures markets initially came into existence
as tools for managing the negative impacts of commodity price risk. In response to
perceptions of market failure some are looking for strategies to regulate the who and how of
futures trading.