Postwar price supports and surpluses undercut Chicago’s agricultural futures exchanges.

Evidence

Agriculture thrived on the Midwest’s endless prairies, but the exchanges that traded futures on the produce of those prairies the Chicago Board of Trade and the Chicago Mercantile Exchange did not always benefit. Government guarantees set minimum prices for agricultural products, while surpluses prevented prices from rising much. The need to hedge the risk of price fluctuations diminished, and speculation on those fluctuations became unattractive. — Donald MacKenzie, An Engine, Not a Camera, 631

Categorization

• SEED: Provides the counterintuitive payoff condition for derivative markets: derivatives need price volatility to exist. Angles on how stability itself can kill a market could work.