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Four billionaires at Glencore

Robert Peston | 09:04 UK time, Wednesday, 4 May 2011

I can't recall a flotation like it, in terms of the sheer number of executives emerging as wealthy beyond most people's wildest dreams or expectations - not even the conversion of Goldman Sachs into a public company or the listing of Google.

Glencore logo

When Glencore publishes its full flotation prospectus later this morning, it will show that there are four billionaires working for the world's leading commodities, minerals and energy trader.

These are led by the chief executive Ivan Glasenberg, who will be shown to be worth around $10bn.

But it is the quartet of billionaires, plus many others worth more than $100m each, and hundreds who are millionaires, that makes Glencore quite extraordinary.

Now all the top executives are saying they won't sell any of their shares for five years at least - that they won't use the flotation to cash in. As for Glasenberg, he's pledging not to sell even a single share till he steps down as chief executive.

Even so, the stock market listing converts their stakes into currency. These are not paupers.

Is there a price for them of this remarkable valuation of their respective Glencore holdings?

Well their company is already receiving vastly more public scrutiny - for it's environmental record and tax practices, for example - than it did as a pretty secretive private company over the last 20 years or so.

It won't like all this attention - such as claims in this morning's Daily Mail of how Glencore's copper mining operations in Zambia are doing too little for that country.

And it certainly didn't enjoy the furore sparked by remarks of the new chairman, Simon Murray, about how women's desire to have babies prevents them rising to then top in business.

But some of you might feel that whatever embarrassment is caused to Glencore's bosses will be softened by all that personal wealth.

Update 16:44: Oh dear. There’s another billionaire at Glencore I somehow missed.

The prospectus – which is longer than Proust, and racier than Proust in parts – shows that the chief executive, Ivan Glasenberg is worth just under $10bn.

Also, two of his lieutenants are each worth around $3.7bn, one other has a $3.2bn holding and the fifth in this billionaire quintet has a $2.8bn stake.

The poor finance director, Steven Kalmin, is worth a mere $610m.

As the FT points out, each one of these has a holding worth more than what the famous (some would use a less flattering epithet) founder of Glencore, Marc Rich, pocketed when he sold the business to management less than 20 years ago.

Comments

  • Comment number 1.

    Well, Robert, tell us what they did that was so special that can justify receiving personal wealth exceeding that of a small country not to mention their not ungenerous salaries. Did they make two blades of grass grow where only one grew before? What have they added to the benefit of mankind and if the answer is diddly squat our system of rewarding enterprise is pathologically perverse.

  • Comment number 2.

    And so we can now add a few names to the list of those businessmen who control the government. Sliver, copper etc are all being manipulated. Just yesterday, a massive co-ordinated sell of silver tried to start an even bigger sell in the market to cover an unbelievable amount of short options. They are all mates after all.

  • Comment number 3.

    Small wonder that they shun the public limelight!

    'ABC Radio reported that Glencore "has been accused of illegal dealings with rogue states: apartheid South Africa, USSR, Iran, and Iraq under Saddam Hussein", and has a "history of busting UN embargoes to profit from corrupt or despotic regimes". Specifically, Glencore was reported to have been named by the CIA to have paid USD 3,222,780 in illegal kickbacks to obtain oil in the course of the UN oil-for-food programme for Iraq. The company denied these charges, according to the CIA report quoted by ABC.'

    http://en.wikipedia.org/wiki/Glencore

  • Comment number 4.

    giz a job

  • Comment number 5.

    @1 Watriler............ I couldn't have put it better myself....!!

    A group of people in the right place at the right time whom have actually AFFECTED all of our daily lives with manipulation of commodities etc.......

    Well done at those in Glencore........ sterling work in producing nothing but artificial wealth which DOES NOT help humanity or the general society we all live in........ it just goes further in polarizing the ever growing void between those with and those without !!

    Dangerous times....

  • Comment number 6.

    Meanwhile disabled children are denied respite care. What a world.

  • Comment number 7.

    Well I was offered a job at Glencore about 6 months ago..kicking myself now, but the point is, why not. If a company does well if the market is prepared to value the company at 61 billion, fair play. I think the majority of us would love to be in a position where we could have millions of shares in a company.

    The thing to remember here is this comany was a closed shop for a long time...like bricks and mortar undoubtedly there were times when people thought about bailing, i.e. leave the company or sell your properties.

    People who stuck with it through thick and thin in the long term will always benefit. All this publicity that Glencore is generating is from short-term view points...like someone has just won the lottery, but its not...the people who are going to make millions have stuck with the company and whatever the price of reward is for that allegaince so be it...

  • Comment number 8.

    The interesting bit!

    International commodities trader Marc Rich was the founder of Glencore (very 'Rich' apparently!).

    'Marc Rich (born December 18, 1934) is an international commodities trader. He was indicted in the United States on federal charges of illegally making oil deals with Iran during the late 1970s-early 1980s Iran hostage crisis and tax evasion. He was in Switzerland at the time of the indictment and has never returned to the U.S.
    He subsequently received a presidential pardon from U.S. President Bill Clinton on January 20, 2001, Clinton's last day in office.'

    http://en.wikipedia.org/wiki/Marc_Rich

  • Comment number 9.

    All commodities traders are speculators, just as merchant adventurers were in former days.

    The only real difference exists in today's insurmountable barriers to entry into the business. An adventurous ship owner with a little capital could go to a spice island and buy some spice and by brining it to another market make huge super profits. Today this process is electronic and requires an enormous infrastructure of banking relationships - so the barriers to entry are gigantic today.

    OK, commodities traders are in a hugely privileged position and they make super -profits, but should they, and are they good for the global economy?

  • Comment number 10.

    Glencore. Let's just remind ourselves how they became that rich, the executives. By cornering markets in everything they can control.

    Through the worst excesses of oligopoly power Glencore and others who dominate the raw materials market are allowed to make us all poorer, and make themselves richer beyond their wildest dreams. And drive up inflation in everything from petrol to pork bellies, and from copper to cocoa.

    That this is allowed to happen, in front of our very eyes, and celebrated in the media, is just a further indictment of the state of our capitalist system.

    In the 1930s we were further advanced than that. Companies such as Glencore would not be offered for sale on the stock market, they would have been split up, to allow competition to drive prices down.

    But these days we just want to be ripped off (perfectly legally - until we change the laws) by companies which dominate commodity markets.

    Time for a change, surely!

  • Comment number 11.

    Glencore - the world's leading energy, commodities and minerals trader. Guess that says it all - especially on commodities - which include food and water - more lucrative than even oil as our global populations are growing out of control?

    Furthermore, as stock exchanges across the world are rapidly and quietly amalgamating, Glencore is a just another symptom of power over basic human needs.

  • Comment number 12.

    Enron springs to mind!!... Too good to be true.

  • Comment number 13.

    "how women's desire to have babies prevents them rising to then top in business".
    I suspect Simon is right on that... Sadly, political correctness makes this a headline while Glencore brush the real news under the carpet.

  • Comment number 14.

    Money has always been the root of evil and will continue to be so.

    It is also the great distractor from the real issues.

    Once resources are valued by money people stop thinking about the resource and focus on the money; either how much can be made or the cost is too much.

    The great issues of today are not being discussed as much as money is.

    1) Energy
    2) Water
    3) Population
    4) Medical Treatments

    For example our planet does not have sufficient resources to continue to support an ever growing population. That population is also growing older thanks to improving medical treatments and needs a continued stream of new people being born to support it. These two facts are conflicting.

    One possible (quite radical but sensible) solution would be to stop treating people once they are over a certain age to at least slow the overall aging of the population which would then allow some control to be brought in over the number of people being born.

    Of course as the majority of people who vote are old no politician is going to bring this forward as an idea or even a discussion topic (Turkeys and Christmas).

    So where is the platform for discussing these facts?

    If you take the ultimate medical solution that noone will die anymore then births will have to be controlled/eliminated OR people will need to be 'put to sleep' to keep the population in balance.

    Money money money - its a fog the world is lost in.


  • Comment number 15.

    This just shows how dangerous the retreat from macroeconomics has been, and its replacement with a crude and quixtoic form of micro and EMH.

    Barry Eichengreen in 'The Bear of Bretton Woods', 2011-04-11 has written that:

    "After all, the ultimate cause of the 2007-2009 financial crisis was the dangerous inconsistency between our multipolar global economy and its still dollar-dominated monetary and financial system. The good news is that this will change over the coming decade, bringing international monetary arrangements back into line with economic realities. The bad news is that ten years is a long time. If recent history is any guide, salvation could still be three crises away."

    Here is Paul Krugman writing about the 2nd edition of Robert Shiller's book:

    "Some analysts still insist that housing prices aren't out of line. But someone will always come up with reasons why seemingly absurd asset prices make sense. Remember "Dow 36,000"? Robert Shiller, who argued against such rationalizations and correctly called the stock bubble in his book "Irrational Exuberance," has added an ominous analysis of the housing market to the new edition, and says the housing bubble "may be the biggest bubble in U.S. history."
    In parts of the country there's a speculative fever among people who shouldn't be speculators that seems all too familiar from past bubbles - the shoeshine boys with stock tips in the 1920's, the beer-and-pizza joints showing CNBC, not ESPN, on their TV sets in the 1990's. Even Alan Greenspan now admits that we have "characteristics of bubbles" in the housing market, but only "in certain areas."


    But what is interesting about this? It from spring 2005!!!! ('Running Out of Bubbles', PAUL KRUGMAN, May 27, 2005).



  • Comment number 16.

    Nothing ever seems to stop someone with the emotional development of a 14 year old from getting to the top in business. Why is infantilism so well rewarded in our culture?Is it something to do with the seemingly perpetual promotion of yoof? Or is it because the young and innocent can be more easily and cheaply taken to the mountain top, promised all the riches of the earth so they can then be manipulated and exploited?

    I suppose that is what is called the devil in the detail.

  • Comment number 17.

    This says to me that the commodities boom is peaking.

  • Comment number 18.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 19.

    Obviously time to reel in the gullible and socialise the upcoming disaster (PR or otherwise). Await HMG's defence of this success story - akin to Cameron's lauding the sweatshop garment factory in Salford recently as a business success - took me back to my youth 50 years ago in Manchester!

  • Comment number 20.

    Good news indeed for the owners.

    So now, Robert, tell us how much Mr Osborne and HM Treasury will also receive in TAX and Duties, as a consequence?

    And finally, who will regulate such a giant - just in case it is now "too big to fail"?

  • Comment number 21.

    Glencore £billions or Facebook£billions? Which are fairer? It's a funny-money old world. Stock markets clearly gives the price of (almost) everything price but value of (almost) nothing.

    On the more dodgy practices of Glencore and its owners suggested here [oh surely not]; once upon a time flotation was used to test the innocence of witches. Perhaps if Glencore sinks the verdict should be innocent!

  • Comment number 22.

  • Comment number 23.

    Time to wear an accountancy hat.

    What assets does Glencore have that might give it a stock market valuation of $61 billion?

    Which of these are fixed hard assets, and which of these are realisable?

    How many are cash assets?

    Which of the other assets are based only on the Group's Trading profits to-date, and therefore are essentially Brand and Goodwill?

  • Comment number 24.

    These are my comments and don't constitute the BBCs view.
    Given that the basis of the strategy for this company is commodity trading, then I personally can only see them as leeches. While they gamble and help create the artificially high prices for every day to day things, we pay for it. They gamble on futures and if they don't meet the futures price then they lose money so what happens....of course they make sure that the prices meet so they get their payout and we suffer with high prices for everything. Market manipulation stinks.

  • Comment number 25.


    #14 GRIMUPNORTH77 wrote:

    'Money has always been the root of evil and will continue to be so.'


    Often misquoted....I think you will find it's the LOVE of money is the root of all evil.

  • Comment number 26.

    The combined mention of the words 'commodity' 'trader' 'billionaire' and 'global' were just to much for the conspiracy theorists, anti-capitalists and their running dogs to resist. But some of the caricatures are quite funny. I particularly like the one where the person with the mind of a 14 year old wakes up one day grinds the faces of a few peasants in the dust and the next day he's a billionaire.

  • Comment number 27.

    Over 40 years ago a college tutor who I respected and admired stated that, we as humans, only moved rapidly forward in matters we were interested in. He said that when he had visited the rain forest it had rained every afternoon and thus the climate remained intact within the cycle, except where clearing had occured. In these areas he had noted soil erosion where rainwater poured into the river and washed topsoil away.

    His theory was that by removing the forest man would destroy the rain cycle and increasing volumes of water would evaporate into the sky to fall elsewhere. He predicted that because we didin't value water enough it would end up running off our tarmac and concrete jungles into the sea and cause levels to rise. More water would mean temperature rises and eventual catastrophe.

    Fanciful if you like, but some sense within.

    It's obscene that individuals have such vast wealth. We have resources to educate, destroy poverty and stem the insane increase in world population but it won't happen all the time we are slaves to money. Let's not forget that one man's gain is another man's loss. In this case it's many of us losing.

  • Comment number 28.

    The only reassuring thing is a lot of their wealth will vanish as stockmarkets crash & currencies collapse.

    No doubt they're already purchased a lot of gold.

  • Comment number 29.

    17 Neil Wilson

    You may well be right but my suggestion is to sell only when a well-known investment bank whose name you can guess says the boom will continue. The price will promptly collapse. This has happened to oil: twice.

  • Comment number 30.

    #25 - thanks - I blame Pink Floyd - interesting that their song 'Money' was written in 1973 and the lyrics are still as appropriate today.

  • Comment number 31.

    This is what happens when you have a system with just one value - profit-making!

    The whole system is about profit not people.
    Hence huge numbers of people around the world die unnecessarily.

  • Comment number 32.

    Exploitation of the under developed nations comes to mind. I couldn't sleep at night if I had robbed others of wealthy resources - just to parade around like a mini despot. When will these people realise this is why we become targets of spiritual debate around the globe. Greed is ugly.

  • Comment number 33.

    @25

    But WHY is the love of money the root of all evil?...

    Even if it is green and crinkly, like Shrek, we all deserve to be loved...

  • Comment number 34.

    That's capitalism for you. In order to make everyone slightly richer, it always makes a few people *very* rich.

    The problem is, we haven't worked out any more reliable way of doing the same thing - ways of controlling the excesses of the few always seem to cut the living standards of the many.

    Still, after having seen the free market operating in fincance recently, it seems that a further rebalancing is necessary.

  • Comment number 35.

    Please can we have a right of centre commentator come on and patronisingly tell us how it would be best to not tax or regulate these guys too much or else the rest of us wont benefit from the largesse they spread around their fellow men and women, by eh, increasing their own personal wealth and eh taking advantage of as many other people as they possibly can. And can they use the phrase 'politics of envy' without a hint of irony.

    I dont want the chief exec to hold onto his shares - I want him to openly sell them and then openly pay capital gains tax to the government. If that leaves him with a little less than a billion then so be it, he'll just have to make do.

  • Comment number 36.

    #33,
    Perhaps they don't love money, it's the money that seems to love them...

  • Comment number 37.

    Our political masters need the tax income from companies such as Glencore so that they can continue to promise the populace great outpourings of largess to match their party manifestos. Of course the fact that this 'money' doesn't really exist or can be generated through any added value process is of no consequence to them. The powerful will always manipulate the poor.

  • Comment number 38.

    Well, they added nothing, indeed they took all that money from people who consumed or produced commodities.
    Thy know the markets, and control them, so any investment in them is a bet against someone with a weighted set of dice. The markets crash when they make them crash, peak, when they make them peak. I would advise my pension fund not to buy, even if the tracker fund wants to. This will briefly rise then be the biggest crash in stock market history (just after the "billionaires" sell out)

    The best thing anyone can do is NOT buy their shares, then they are not billionaires. simplez

  • Comment number 39.

    "Now all the top executives are saying they won't sell any of their shares for five years at least - that they won't use the flotation to cash in. As for Glasenberg, he's pledging not to sell even a single share till he steps down as chief executive."

    Well cash looks iffy gold is at an all time high and in recessions commodities are what people turn to. So why would they sell if there is more money to be made where they are?

  • Comment number 40.

    #7 I think the reasons to suggest "why not" are many. It's completely unfair that a system operates in this way, where those generating inflated profits receive huge payouts, just because their supposed 'value' can be calculated. What about the value of a nurse who helps lots of patients to get better who then go onto create economic wealth, don't they deserve a bonus?
    Also, I'm not sure the majority of people would want a million shares in a company. I for one would not want to have such ludicrous levels of wealth whilst others in the world have so little.

  • Comment number 41.

    #34 Cassandra

    "That's capitalism for you. In order to make everyone slightly richer, it always makes a few people *very* rich."

    I think this was largely true for most people in developed countries in the 20th century.
    But now many people in developed & undeveloped countries do not expect the next generation to be as well off as them or their parents.

    Real wages are falling!

    This isn't likely to be temporary as capitalism appears to reaching breakdown - i.e. it is more than a cyclical boom & bust.

    To understand this conclusion requires a broad understanding of capitalism & history.

    But to try & put it succinctly:
    1. Capitalism requires unending growth
    2. Supply-side barriers are being hit
    3. These barriers put downward pressure of the rate of profit (temporarily hidden by fictitious capital - money thrown at the system & put to no productive use)
    4. The consequence is an attack on workers pay, pensions & conditions.
    5. Workers rebel.

  • Comment number 42.

    post 27 @ 12:01 on 04 May 2011 - tiredofit' makes fair, genuine and and valid points.

    Exploitation, that Glencore, was so quiet about has been sold to ...? We don't know, but can guess? The term 'commodities' is a wide-ranging term within the commodities markets, globally. Food, water, heat and light are human and humanitarian basics wherever you live, including the UK. These so-called commodities are causing deep poverty in the UK too - but our Tory led Government are not interested as they are raking in so much VAT @5% on heat and light and 20% VAT on everything else.

  • Comment number 43.

    "34. At 12:42pm 4th May 2011, Cassandra wrote:
    That's capitalism for you. In order to make everyone slightly richer, it always makes a few people *very* rich."

    Sorry that's rubbish. Capitalism legitimises and promotes greed as a singular motive to promote growth (or real growth as opposed to capital growth) but it also skews the path of growth, distorts the distribution of wealth and once growth has been optimised those same levers destroy everyone's wealth and capacity for growth.

    There are clear signs that we have optimised our capacity for growth - twenty years of stagnation of Japan's economy, property generated growth in Europe and the US, the price of oil, and now the hunger fueled riots in Egypt, Libya, Tunisia and Syria.

    Now is the time to jettison or severely restrict the excesses of capitalism and to concentrate on redirecting how we direct our energies by building up the infrastructure to harness renewable energy and focus on the low hanging fruit undermining the productivity of developing nations like Malaria, AIDS, destabilising wars.

    Generating wealth through monopolising commodities markets helps noone except the very wealthy and/or powerful and even them for only a short time.

    There is no single system that is right. For too long we have been encouraged to put our entire faith in capitalism. This is wrong. We need to focus on the need to promote a common good, and not just within our borders, to prevent global collapse.

  • Comment number 44.

    People are free to communicate their opinion regarding the social utility of companies such as this, but basing them on unsubstantiated generalised statements and sometimes outright false information makes you no better than the tabloids which you love to deride.

    There is a tremendous amount of uneducated rubbish in these comments, primarily regarding tax and people implying that they are "stealing money from normal people, and then holding on to shares and not paying tax"...

    Glencore is NOT a British company, it is headquartered in Switzerland and most of it's top employees live there, so we wouldn't see any tax anyway. There is no government manipulation meaning they "get away" with it, we have no control over what a foreign company does or doesn't do, we will never need to support them or be reliant on them in any way. The extent of obsession regarding "tax" and envy of successful businesses on here is frankly laughable...

  • Comment number 45.

    Certainly they will need a tax break....the economy will be in a stall otherwise...isn't that what the political say....handmaidens for the rich. Criminals come in many colors and dress..poor criminals go to jail....rich criminals are taken to diner by politicians.
    Religion should get a big boost soon because there is absolutely no reason to believe that governments are anything more than the front for criminal bankers and investors.

  • Comment number 46.

    Good article, shame about the grammar:
    "...for it's environmental record and tax practices..."
    @LastBastionUK

  • Comment number 47.

    It's interesting that Robert draws attention to the obvious parallels between Glencore and Goldman Sachs....but what are the not so apparent parallels?

  • Comment number 48.

    Surley an easy way to stop these companies from making huge speculative profits that end up costing the man in the street is for governments to get together and pass a simple law which says you can't sell it untill you've taken physical delivery of it.
    This should basically ensure that the end user buys it from the producer.....unless anyone really wants to take delivery of 10 million barrels of oil.....!!

  • Comment number 49.

    Money is in fact quite useful - try taking a chicken to safeways to barter when you want to buy a packet of cornflakes.
    Glencore is a swiss based company - not sure how much they and their key execs will be paying in UK tax.
    If the UK health service was listed and the nurse owned 10-15% of it she or he would certainly be worth multi millions - perhaps billions. If however she/he was selling her labour like most of the rest of us she wouldnt by the simple principle of supply and demand - there being other nurses available.
    Glencores equity certainly stretches well outside the main board - there are at least 485 of them who will become millionaires. Good luck to them. The money wont make them happy - but hopefully they will have enjoyed all the grinding hours of work and sacrifice to get there. Glencore owns significant stakes in several large mining companies - an activity not always favourite with the greens and an industry not know for its philanthropy. However, it does need spectacular ammounts of capital to build the machines and develop the processes to hauk great chunks of rock out of the ground and throw them about as required for export. I suppose whether this is socially useful or not rather depends on your point of view. I am sitting in a room whose roof is held up by a wacking great steel beam, sitting on a steel chair, looking out a window with an aluminium frame - so I would say yes. But on the other hand life would be much more morally correct if we all lived in mud huts ate grass and bartered with each other for the occasional wooden mug. Then we would really need the health service.

  • Comment number 50.

    Interesting little item on p.32 of the latest Private Eye, mostly talking about Marc Rich as per comment 8. Seems Tony Hayward, ex BP, is the senior independent director of Glencore, so we can expect some good safety practices in Zambia, no doubt, follwoed by some interesting PR. A former employer of mine was talking to Rich's eponymous oil trading firm in my presence once and put the phone down, saying "Bunch of crooks".

  • Comment number 51.

    Glencore,Goldman Sachs, Monsanto and...... I swear these are the 4 horsemen of the apocalyse. A special prize goes to who can guess the 4th one.

  • Comment number 52.

    RP wrote:
    "It won't like all this attention - such as claims in this morning's Daily Mail of how Glencore's copper mining operations in Zambia are doing too little for that country.

    And it certainly didn't enjoy the furore sparked by remarks of the new chairman, Simon Murray, about how women's desire to have babies prevents them rising to then top in business."

    -------------------------

    I wonder what Glencore are planning - the private wealth of the top four at Glencore was vast irrespective of flotation value, and the level exposure for Glencore in going public will undoubtedly uncover more embarrasment for the company which raises questions as to why they would opt for an IPO. The sole reason, as far as I see it, for IPO in this instance is for expansion - the best way to raise capital quickly, and in large sums.

    Any ideas Robert?

  • Comment number 53.

    Posting this for the last time, in case anyone can explain it any other way.

    http://www.rba.gov.au/statistics/frequency/commodity-prices.html

    The shape of the graph gives an indication of the size of the boom since de-regulation.

    And then the dip at 2008 gives a possible indication of the effect of global credit on commodity prices.
    ~~~~~~~~~~~~~~~~
    I came across an interesting story recently, if you concatenate these into a search engine

    forums . somethingawful . com / showthread.php ? threadid=3396041

    conspiracy theory? maybe? mushroom no longer knows nor cares. mushroom has taxes to earn and bills to pay.

    TTFN

  • Comment number 54.

    #51 bill40

    erm - Stalin ?

    did I win ?

  • Comment number 55.

    It is appalling that this group who have contributed to world poverty by pushing up oil and food prices are going to be rewarded with such vast sums. This money could turn round some of the poorer countries suffering under their power

  • Comment number 56.

    53. At 15:06pm 4th May 2011, stillpuzzled wrote:
    Posting this for the last time, in case anyone can explain it any other way.


    It would be intersting to see a graph of the increase in China's purchases alongside.

  • Comment number 57.

    #53 - thank you - this is very clear to me. The price of commodities is driven by the level of speculation over their future prices and therefore the existence of companies like Glencore has driven up those prices for their own benefit - hence the involvement of so many already rich people in the company who have the power/financial strength to make their speculation a self fulfilling prophecy.

    The rich get richer - meanwhile who has been suffering as a result of all the increases in commodity prices?

    RP - this is clear market manipulation by the 'haves' to the detriment of the 'have nots' - please write about it. Thank you.

    Also please write about how a model of ever expanding consumption can possibly work on a planet of limited resources.

    Then compare and contrast the two scenarios - perhaps the price manipulation of commodities may actually be for the benefit of the planet in the long run??

  • Comment number 58.

    "Surley an easy way to stop these companies from making huge speculative profits that end up costing the man in the street is for governments to get together and pass a simple law which says you can't sell it untill you've taken physical delivery of it.
    This should basically ensure that the end user buys it from the producer.....unless anyone really wants to take delivery of 10 million barrels of oil.....!!"

    Perhaps passing a law that would bankrupt the entire world instantly may possibly be a little bit on the "overkill" side? Just a thought...

  • Comment number 59.

    Robert,
    Is Glencore a 'trader' or is it an 'investment fund'? If the former, how has it accumulated so much 'wealth'?

  • Comment number 60.

    re #52
    Going public from private creates non-sovereign wealth in large quantities for a few individuals. Going public from private spreads risk.

    'Nuff said?

  • Comment number 61.

    Er last time I checked we (mostly) live in a free world. The effect of speculation on commodity prices is small, and has much more to do with the unrelenting demand from China. If they are suddenly worth gazillions of dollars then good luck to them.

  • Comment number 62.

    43. At 13:44pm 4th May 2011, United Dreamer wrote:
    Now is the time to jettison or severely restrict the excesses of capitalism and to concentrate on redirecting how we direct our energies by building up the infrastructure to harness renewable energy and focus on the low hanging fruit undermining the productivity of developing nations like Malaria, AIDS, destabilising wars.

    - I thought the world had an ever growing population that it couldn't support? I suggest that war and Aids could be the very tonic to get us out of this pickle. Read Malthus dear boy.

    I say good luck to Glencore. It's always funny reading the comments of the poor of England criticising billionaires when their average English salaries makes them very rich to the majority of the world. If you want to criticise Glencore, fine but only live on one dollar a day.

  • Comment number 63.

    In the longer term the price of commodities is increasing because a larger slice of the planet want the same standard of living (in terms of the ammount of stuff we each own or consume) as the west. So we are are living through a rebalancing of the global pecking order. Chinese mining interests will be large investors in Glencore and Glencore are themselves will seek to acquire chinese mining conglomerates funded in part by sovereign wealth from Abudhabi. Admittedly some of the froth on this market is speculative, but it is only froth - the fundamental is that continued growth and development in china and to some extend in india will require large ammounts of primary natural resources so investment is required to hauk it all out. Those prepared to take a risk on that investment will be rewarded if there assessment of the basic supply and demand is correct. If not (either because china falters or they buy the wrong assets) they will all loose their shirts. To that extent the investment is also speculative - but so is any investment where there is a timing gap between investment and exit and uncertainity on the exit price. Thats how this sucker works (to quote the wisdom GW) and until we invent a better way of meeting all our needs it will remain the most efficient way of lifting people out of poverty that we know. Consequently I'm not sure I really recognise all this global conspiracy theory and capitalists eating babies for breakfast stuff. Can we get back to the real world please ?

  • Comment number 64.

    Upsnuff - to quote reuters glencore is simultaneously the world's biggest commodity trader, a sizeable miner, and a big investor.

    so at the same time as trading it certainly owns big stakes in mining conglomerates that actually dig stuff out of the ground. Interestingly reuters suggests that analysts would value the trading part much more highly than the mining part - presumably because its not so capital intensive - until of course the wheels come of the wagon (if they ever do) personnally I would wonder about sustainability both due to market trends and after the float has made 4-500 of the management team rich.

  • Comment number 65.

    Although I abhor the way companies such as these make their profits, it is and always has been this way, the law of supply and demand. If you can buy and sell anything at a profit then the opportunity to grow your money pile is there.
    Incidentally, the love of money cannot be the root of evil, the concept of evil existed long before the concept of money. Perhaps evil is the root of money?

  • Comment number 66.

    #58 soxsexsax -

    yeah quite - but I guess it would be interesting to see all the traders clambering over the piles of ore lying about the square mile in their hobnailed church's.

    an interesting stage for the London Marathon as well

  • Comment number 67.

    #1

    They owned the shares, which were valued by the market...

    Not all that complicated.

    Good on them, they took a risk taking control of the company, and made the best of it, a success story in my eyes, and something of an inspiration.

  • Comment number 68.

    "I say good luck to Glencore. It's always funny reading the comments of the poor of England criticising billionaires when their average English salaries makes them very rich to the majority of the world. If you want to criticise Glencore, fine but only live on one dollar a day."

    Two points.

    I don't make indiscriminate criticism of billionaires, just those that make money on the backs of the poorest and most vulnerable. Thanks for the ruling but if its all the same to you I think I will maintain the right to criticise who I believe are earning money immorally, without restricting myself to the poverty inflicted on the poorest of society by the wealthiest. Interesting perspective you have though. I wouldn't describe myself as poor though so maybe you're not talking about me.

    My second point is - are you seriously advocating the deaths, disability, rape (in the case of war) and maiming of people and orphaning of their children by war and AIDS? I notice also you missed out on Malaria which kills more than both combined.

    I'm curious, does a deeper sense of morality actually enter your thinking? Or is it just an unnecessary hindrance.

  • Comment number 69.

    Re: SoxSexSax "Perhaps passing a law that would bankrupt the entire world instantly may possibly be a little bit on the "overkill" side? Just a thought..."

    Um, not sure you've grasped the concept of overkill yourself. Just another thought...

  • Comment number 70.

    The good news is that resources are finite, as are the lives of those that believe they own them

  • Comment number 71.

    I wonder how many of us commenting on here do so from a position of fairly comfortable material security. And how many of us, if it were not for concern at the ever growing hundreds of millions struggling just to survive each day and concern at the ongoing rape of the planet in our name, would simply let these people get on with it. But we do worry and I fear, know not where to turn.
    I would like to recommend Oliver James's "Unselfish Capitalist Manifesto", to be found in his book "Affluenza". There are many genuine insights in to the general mental health and "happiness levels" in the (economically) developed world. I have to confess to the occasional satisfaction thinking of the problems and apparent lack of real happiness amoung these greedy guzzling gorging pigs in our "City" and the others like it.
    I've often wondered of the billions of children who have slipped through the net and succumbed over the years, or even having never attained their full potential because of this dreadful system, how many potential Pasteurs, Angelos, Mozarts and Einsteins were there?

  • Comment number 72.

    Now that Dave's BigSock has resulted in redundant coppers going back as specials for naught. I think I shall volunteer to work at Glencore. I could empty their wpbs I might find a few tenners to augement my pension.

  • Comment number 73.

    Watch for some not very enterprising or entrepreneurial publicity seeker thinking this would be a good way for him to make money for himself and his brand. Mainly himself.

    The Russians have their oligarchs that have grabbed commodities for their own gain.
    These guys have done the same thing but in a different way.
    The results are the same. We are all paying over the odds for these guys.

  • Comment number 74.

    Here we go again, traders (speculators) who have seen the banking boys get away with it and know that we ordinary folk will not stop them. Meanwhile 99.9% of the people of the world get poorer because it is they who pay the prices of commodities and the bonuses of these people with their own real cash - no futures, no financial instruments - just cash out of their pockets. What a world eh!

  • Comment number 75.

    @20

    Could you explain how a person resident in Switzerland, owning shares in a Swiss company, be taxed in the UK?

  • Comment number 76.

    Some people are so jealous. Stop worrying about how everyone else and concentrate on making yourself the best that you can be.

  • Comment number 77.

    There are enough resources on this earth to sustain a growing population. If only the richest one percent of the worlds population did not use ninety percent of the resources. "Let them eat cake".

  • Comment number 78.

    I get it now.
    Pump up the price of commodities and then sell off the company.
    You make on the way up and on the way down!
    Taxpayer pays.

  • Comment number 79.

    re #64
    Ta! So, describing them as a trader is a mite misleading .....

    Ahem! Robert .....?

  • Comment number 80.

    To all the smart alexs on here, the float will be on the LSE therefore British commentators do have a right to demand something be done. This company will use Britain's stability and strict business v public protection laws to ensure the float is as profitable as possible.
    FEEDBACK LOOP, you need to stop doing what ever it is you do and read some books, stop thinking in your blinkered 'this is the way it is' mindset. may I recommend David Harvey first and read up on why Capitalism is such a bad idea for 95% of us on this planet.

  • Comment number 81.

    "14. At 10:45am 4th May 2011, GRIMUPNORTH77 wrote:
    Money has always been the root of evil"

    I think you'll find that it's the LOVE of money that is quoted as the root of evil.

    I've just taken a fiver out of my wallet and to be honest, it looks quite harmless.

  • Comment number 82.

    5 more added to to the inflation proof breed, as if they were not already there! But their immunity as per others of this ilk are not immune to a lot of other things! Using the law of averages some will succumb and discover that wealth is not everything!

  • Comment number 83.

    76 - absolutely, spot on.

    One of the fundamental problems with this country is that when someone sees a nice car, rather than think about how they might get one the same, they're more likely to key the paintwork out of jealousy and spite.

  • Comment number 84.

    A lot of the posts above are envy posts, some say good luck to the Billionaires, however none point out that "Everyonel will die in due course" and cannot take their money with them.

    Taking the long view, all this wealth we be distributed again, either by taxes or inheritance or by gifting.

    My advice is to not get so hung up about it. Think in geological timescales, then it is all irrelevant, even the Copper, Aluminium etc will be recycled.

  • Comment number 85.

    "83. At 12:52pm 5th May 2011, AndyC555 wrote:
    76 - absolutely, spot on.

    One of the fundamental problems with this country is that when someone sees a nice car, rather than think about how they might get one the same, they're more likely to key the paintwork out of jealousy and spite."

    Its not jealousy of riches its genuine anger at riches gained at the expense of others much less able to afford the expense through an abuse of their monopolistic position driving commodity prices up. Very similar to the expenses row that saw the imprisonment of many MPs but not anywhere near the same amount. Or is that jealousy and spite as well?

    PaulattheRocks. Wrong, wealth gained by the wealthy is used to gain more wealth, and fund positions of power so that generation of wealth and power is secure. It promotes the use of energy for luxuries for rich people when it could be used much more efficiently to alleviate genuine suffering.

    The trickle down effect is a myth otherwise we wouldn't be experiencing the unprecedented differential in wealth between the poorest and richest that we currently are.

    And if you want to become a fossil, feel free. I fear you don't understand genuine poverty and its impact on people's lives otherwise you wouldn't have been so glib in your pronouncements.

 

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