1. Transforming Finance Conference W here do our savings go? Capital markets and accountability The need for regulation – the case of food speculation 10 May 2013 Hannah Griffiths Hannah.griffiths@wdm.org.uk

2. Key concept: Deregulation (by governments) has got us into this mess. Regulation (by governments) can help us to get out of it. Illustrated by food speculation

3. What is food speculation? Speculators bet on increases in the price of food by buying products known as derivatives. Derivatives are contracts. Their value is derived or based on the price of an asset – in this case, food.

4. Food prices 1990-2011

5. Typical spending on food Global north 10 - 15% Global south 50 - 90%

6. USA, 1800s

7. USA, 1930s

8. 1990s

9. What are these markets for? Price discovery Hedging commercial risk But these functions are increasingly disrupted

10. Balance of participants Market share (Chicago wheat futures)

11. Recipe for reducing volatility Exchange trading Position reporting Position limits

12. How can we ensure investments serve people and planet? Yes government needs to fundamentally change the rules! We need to demand more of government Radical new ways of investing are especially useful when they shift the mainstream

13. Transforming Finance Conference W here do our savings go? Capital markets and accountability The need for regulation – the case of food speculation 10 May 2013 Hannah Griffiths Hannah.griffiths@wdm.org.uk