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Performance art against that law?
Also November onions are an absolute steal compared to the adjacent months!
I hate to argue but then what would they define this as, if not an organized exchange or other trading facility?
Legal defense is basically "nuh uh"
I think their point is there's no "peer to peer" trading so it's not an exchange. You're always contracting futures with them, so it's more like a vegetables seller than a trading facility.
Exactly right. You're able to privately resell contract keys (and the buyer can then re-issue a new key with their delivery info, voiding the old one), but onionfutures.com doesn't facilitate it.
I mean, it kind of does, though, no? Since it is backing the contract in the first place? Why else would anyone buy those contracts if they didn't know they have value provided by onionfutures.com in the first place? Why can't I just sell a fake key, claim it'll work, and make unlimited money this way if that wasn't the case?
The specific laws do not actually ban the transfer of those contracts (tbf this is very complex and depends on your reading). And yes they do not facilitate the trading of the instruments in the secondary market but they absolutely facilitate the instruments themselves otherwise there cannot be a secondary market without any backers of the instruments.
See FBT's comment below, it's about matching or being on both sides of the trade.
7 USC § 1a(37) defines an "organized exchange" as
And 7 USC § 1a(51)(A) defines a "trading facility" as
(7 USC § 1a(51)(B) then follows with some exceptions to that definition.)
In short—an "organized exchange" is defined as a type of "trading facility". To count as a trading facility", whether of the "organized exchange" type or not, you must either accept bids or offers from other participants yourself or else deterministically match and execute those bids and offers.
I believe 10/15 is a huge harvest day for Vidalia(??) Onions so crop will be scarce leading up to the harvest. As my multi-player free farming simulator has shown me. https://farm-mp.frontpageintelligence.ai/
This is really neat, but, the wages and other costs are way too ballooned to envision as a simulator parallel to 'real life' farming.
For those who don’t know:
https://en.wikipedia.org/wiki/Onion_Futures_Act
(which also banned box office receipt futures)
A fun thing is to go on FRED and make a graph with prices from onions and, say, corn to see the differences in volatility.
So this is genuine free market activism?
What will the kids think up next?
I looked up onions, lettuce and tomatoes (because burgers), and the volatility actually looks very similar. Am I missing something or looking at the wrong things?
Tomato: https://fred.stlouisfed.org/series/WPU01130217 Onion: https://fred.stlouisfed.org/series/WPU01130216 Lettuce: https://fred.stlouisfed.org/series/WPU01130215
The weather affects all crops
And the cost of transportation.
But isn’t the point that futures trading reduces volatility from things like weather?
“Absorbs” volatility might be more accurate.
This has to have been the inspiration for Milo Minderbinder cornering the cotton market in Catch-22, right?
Interesting. This would be more sensible if it was time-bound. Since the intention was clearly "stop a bad thing someone is doing right now" and not "make this field illegal forever"
These onion prices are quite high! The novelty probably drives up prices. Too bad there isn’t a liquid market for onions
Onion soup sounds highly fungible.
Maybe if you put some mushrooms in it.
Maybe I open a tor store for people trading these onions with one another?
How many onions / lbs does a contract represent?
Pricing is per onion. You could order some and weigh them, and report back.
A contract represents a set of (quantity, month) tuples, where quantity is an integer greater than zero; that number of yellow onions will be delivered in the corresponding month to the current holder of the contract. The mass of each onion is unspecified, as is the mean and variance of the underlying onion-mass distribution from which they are drawn.
These are 1 onion contracts? Outrageous!
I know, right! Way overvalued. I’m shorting onions.
hell yeah, based
Can we tokenize this or get some prediction markets going on Polymarket?
Go for it, https://a11ce.com/#contact if you want to coordinate on any sort of derivatives
Why was the law against onion futures passed in the first place? Couldn’t the same scheme be done with garlic, or sweet potatoes, or turnips or something?
Because Vincent Kosuga.
A guy cornered the market in the fifties, caused a scandal, they made a special exception.
Two guys. At one point bags of onions were being sold for less than the value of the bags they were in...
They also got onion farmers to buy back onions they'd already sold.
But what I’m saying is, why did they only cover onions? I don’t think there’s anything stopping someone from cornering the market in other commodities just as easily
Because the size of the market was/is so small that you're actually able to corner it. Oil or Treasury futures are far too big that no single person could ever corner it.
Though the Hunt brothers made a pretty good run at the Silver market in 1980.
China went all in on rare earth concentrate processing, taking the environmental hits that no one else wanted to touch.
That paid off in a concentrated lock on the bulk of rare earth applications.
Because American lawmakers are weirdly specific brainless creatures. This is how you get all those laws named after individuals like Megan, and my other specific fave, the Video Rental Records Privacy Act.
Shall we address the general question of privacy, or just close the particular breach that affected a congressman? You know it's going to be the latter.
narrowly scoped laws limit the blast radius of a stupid law without the political price of opposing a law in the aftermath of a disaster that law would have prevented. imagine if they had banned commodities trading in general!
Legislative product management, by committee.
This one is a great example of how a Republic can avoid the worst excesses of direct Democracy
A direct democracy might have just banned all futures.
The people behind this are a real (if silly) student organization at UChicago and Northwestern campaigning for the legalization of onion futures trading. Sometimes they will aggressively hand out free onions to passerby on campus. It's quite entertaining.
They have a website also: https://onionfutures.org
Hi! I'm the proprietor of onionfutures.com. I'm actually not a member of UChicago for Our Futures and came up with the idea independently, but we've since connected and they handle our Chicago deliveries.
Are you really charging $9/onion? I get upset when Safeway charges $2/lb when I can get onions for a quarter that price.
Priced to what the market can bear
Maybe it's a really big onion
maybe it tastes more oniony than most onions, these onions are the essential onions of which other onions are mere shadows.
It's the mischief caused by shadow onions lurking in dark corners of the market bins that make me cry.
Yes, it's primarily a novelty/art thing. But I do actually deliver the onions. Prices vary.
“We are selling to willing buyers at the current fair market price”
https://youtu.be/wYlptbR0Dkw
I read that in his voice.
I can confirm this person is the owner of onionfutures.com
I can confirm this person can confirm a11ce is the owner of onionfutures.com
I can confirm that these people are silly.
[citation needed]
US Department of Agriculture publishes a national potato & onion report (issued daily!):
https://www.ams.usda.gov/mnreports/fvdidnop.pdf
Readers may wish to skip ahead to page 4, where onions are discussed.
In an onion related note... is the "I sell onions on the internet" guy still around? I believe he was selling Vidalia onions.
It appears so! https://www.vidaliaonions.com/
I bought a box of onions from him before and they were very good. I ate those onions for a long time.
Since this may be a legal gray area, they should host it on a Tor onion site.
oooo, that's a missed opportunity
Why don't existing futures cover this? Are onions unique in how sturdy they are? You can use derivatives of the weather itself even.
Because, specifically for onions, it's infamously illegal in the US (as the site alludes to).
Are these contract prices really "per onion"? Or are they actually per pound or per kg? Up to $9.39 seems very expensive if it's really the price for a single onion.
I thought maybe they're some sort of special exotic onion variety, but I don't see anything to suggest that.
They are per (normal (sometimes organic) yellow) onion. Prices vary.
(It's primarily a novelty/art thing. But I do actually deliver the onions.)
Love it, reminds me of early days of crypto.
How do you decide upon a price?
the pizza to onion ratio of course
Looking forward to my 2 onions in November! Anyone have some good recipes?
Search for italian “soffritto” and “ragù alla bolognese”
French onion soup [0]
Some personal preference not covered in that recipe: do not caramelise all your onion; instead, keep a quarter and add it in after you have caramelised the rest. This gives a bit more variety in terms of taste and texture.
Few things warm your cockles this satisfyingly on a wet, dreary late-Autumn evening.
[0] https://www.seriouseats.com/french-onion-soup-recipe
The Future's Bright. The Future's Onion.
This is very good.
I get that it’s a joke, since onion futures are illegal. But isn’t trading all futures regulated?
You're not really trading a future, you're just pre-ordering onions.
These are not forwards, not futures.
Yeah, this is pretty much the loophole. They're never actually referred to as futures, but as "private, transferable contracts for the future physical delivery of yellow onions".
For those unfamiliar, there's an excellent Planet Money episode on how trading onion futures got banned in the 50s.
https://www.npr.org/sections/money/2015/10/14/448718171/epis...
Someone at the onion needs to see this.
Hard to take this seriously when it just lists “onion” as the commodity. The onion we extract from the ground is not the same everywhere. Onion can be either light or heavy based on the size and density. Light onion will roll more easily than thicker, "heavy" onion.
The sulfur content also affects the onion quality and price: “sweet” onion has low sulfur content, “sour” onion has high. Sweet onion can be used much more easily than sour onion, which requires more culinary processing to extract the sulfur compounds that make you smelly and your eyes water.
Onion has been shown to have a negative impact on climate, especially on air quality with people in confined spaces after lunch, but despite this it continues to be a valuable resource that is processed into many everyday foodstuffs: white, yellow, red, salad, and for specialist applications the highly refined shallot and pearl compounds as well.
Alas it seems likely that geopolitical upheaval will mean onion trading at ever higher prices. Brest Roscoff Intermediate (light, sweet onion) is trading over $8 a bunch (yes, crude onion is traded in weird units!) since the war began.
There’s also a bright future for synthetic. environmentally friendlier onion! Hydroponically grown scallions — so called “green” onion — have some interesting applications in the aerospace industry e.g. in-flight sandwiches and salads.
I'll take 2000 please.
Tsk. There is no free market.
I can't wait until someone tries to corner the market, holds a shitton of future onions, the onions go bad and the market implodes showing that future contracts on perishable items is generally a bad idea.
Future contracts on perishable items are executed all the time.
I can't short onion futures? Why? Buying the nov. Contract and selling the dec. Would net a >100% return on a month (minus the freezing cost of the onions)
You can, since the contracts are transferrable. But SFOFC is not an exchange so you'd have to find a buyer yourself.
How many times have you failed delivery where you have been able to establish contact with contract owner and they want their onions? Curious
Someone call Peter Askew, the vidalia onion guy!
www.onions.com
haha : )
It's an onion Michael, how much could it cost, $9.41?
How is this article HN newsworthy?