Hedge Funds Driving Up the Price of Gasoline & Other Commodities

My Corporate Governance class at the Texas Tech University School of Law was discussing Institutional Investors, including hedge funds, as a potential monitor for the boards of directors of publicly traded companies.  In the course of the discussion, we also talked about a big negative impact hedge funds and pensions funds are having on the current price of gasoline, corn, and other basic commodities.

Thanks to Tadd Tobkin for this controversial article which raises the argument that even Calpers, which most people think of as one of the most socially concerned institutional investors, must assume some blame for the fact that food prices in third world countries have risen to the point that people are starving -- a result of institutional investors "pushing a wall of money  into the $200bn  commodity index funds."

(ag) April 16, 2008, in Economy