Читать книгу CryptoDad - J. Christopher Giancarlo - Страница 21

As of 2014,⁸ about 800 million people around the world today were undernourished. That's roughly one in nine of the world's 7.2 billion people—a staggering shortfall. Now consider that there will likely be another two billion people on earth in 30 years.⁹ Even if those projections are only half accurate, we will have another one billion people on earth by 2048. How will all of these people be fed?

Clearly, the world's agricultural exporting nations, including the United States, will play a big part in feeding the globe in the decades to come. These food exporters can feed an additional billion people because of the critical support of well-functioning financial and derivatives markets. Efficient and well-regulated derivatives markets serve at least two critical roles in helping to feed the world's growing population. First, they allow markets to resolve imbalances dispassionately and efficiently by providing reliable and fair benchmarks for prices. Second, they reduce price volatility in a resource-constrained world by removing the economic incentive to hoard physical supplies. They allow farmers to quantify and transfer risks they want to avoid at a reasonable price to persons willing and able to hold that risk. They help control costs and facilitate return on capital to support essential investment in farming equipment and agricultural technology necessary to meet increased global food demand. Providing farmers this risk protection reduces earnings volatility and thus price volatility, benefiting everyone, including millions of consumers who have never heard of derivatives markets.

The greatest beneficiaries of global derivatives may well be the world's hungriest and most vulnerable. If derivatives trading were ever to suddenly cease, they would certainly suffer the most from the extreme price volatility in basic food and energy commodities that would result.¹⁰ In developed economies like the United States, we rarely have to worry about such things thanks to two main types of derivatives. The first type are traded on organized exchanges, like the Chicago Mercantile Exchange, and are called futures or options. The second type are traded in a more negotiated process called “over the counter.” Many of the latter trades are referred to as “swaps,” because two parties agree to exchange cash flows and other financial instruments at specified payment dates during the life of the contract.

I have explained how swaps and other derivatives work so that the reader will later understand their importance in the emergence of Bitcoin and other cryptocurrencies. For now, it's swaps that brings us back to our story.