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Barclays bank made nearly $800 million speculating on food

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When central bankers talk about more quantitative easing to help spur markets, remember this. While millions around the world go hungry or pay more for food, the bankers are cashing on enormously on the crisis. Barclays is being named here but don't forget that both Goldman Sachs and Morgan Stanley also operate in this space.

There used to be rules against profiting from items like food but that became old fashioned and required modernization by the political class. If they can't make a single case out of losing trillions of dollars during the banking crisis, it's obvious at this point that the political class won't be interested in reforming this revolting business.

How's that modernization working for everyone?
Oxfam's private sector adviser, Rob Nash, said: "The food market is becoming a playground for investors rather than a market place for farmers. The trend of big investors betting on food prices is transforming food into a financial asset while exacerbating the risk of price spikes that hit the poor hardest."

The World Development Movement report estimates that Barclays made as much as £529m from its "food speculative activities" in 2010 and 2011. Barclays made up to £340m from food speculation in 2010, as the prices of agricultural commodities such as corn, wheat and soya were rising. The following year, the bank made a smaller sum – of up to £189m – as prices fell, WDM said.

The revenues that Barclays and other banks make from trading in everything from wheat and corn to coffee and cocoa, are expected to increase this year, with prices once again on the rise. Corn prices have risen by 45 per cent since the start of June, with wheat jumping by 30 per cent.

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