…Take the grain titan Cargill. The largest private company in the U.S., Cargill has gathered and shipped a bulk of the world’s supply of wheat and corn for more than 100 years. Nowadays, however, Cargill also sells billions in derivatives to food companies, and runs two massive hedge funds, managing more than $14 billion for investors. Or take Louis Dreyfus, another major grain trader. In 2008, Dreyfus launched its own fund enabling investors to bet on food prices. By 2011, the fund had grown so fast it stopped accepting new money.
The New Republic Article
“There is no regulation of physical [commodity] markets,” said Mike Masters, founder of Better Markets and a hedge fund manager in Atlanta. “It’s the Wild West, they can do whatever they want and nobody knows.”