BETTER TO EXPLOIT THE ARBITRAGE OPPORTUNITIES. On Newmark's Door is a thesis that those who would grumble about commodity speculators ought read and understand. Apparently, a futures contract in onions is not in the public interest. In the absence of futures contracts, price volatility is not unknown.

1) even in a market in which futures trading is prohibited by statute, price can rise (and fall) astonishingly fast, and 2) "The volatility has been so extreme that the son of one of the original onion growers who lobbied Congress for the trading ban now thinks the onion market would operate more smoothly if a futures contract were in place."

The linked article provides more context.

Before the U.S. Commodity Futures Trading Commission starts scrutinizing the role that speculators may have played in driving up fuel and food prices, investigators may want to take a look at price swings in a commodity not in today's news: onions.

The bulbous root is the only commodity for which futures trading is banned. Back in 1958, onion growers convinced themselves that futures traders (and not the new farms sprouting up in Wisconsin) were responsible for falling onion prices, so they lobbied an up-and-coming Michigan Congressman named Gerald Ford to push through a law banning all futures trading in onions. The law still stands.

And yet even with no traders to blame, the volatility in onion prices makes the swings in oil and corn look tame, reinforcing academics' belief that futures trading diminishes extreme price swings. Since 2006, oil prices have risen 100%, and corn is up 300%. But onion prices soared 400% between October 2006 and April 2007, when weather reduced crops, according to the U.S. Department of Agriculture, only to crash 96% by March 2008 on overproduction and then rebound 300% by this past April.

Topic drift ... was Consolidated Foods' acquisition of Gentry Garlic (which a court found in violation of the Clayton Antitrust Act) an attempt to hedge onion prices?

Alex at Marginal Revolution has more history. King at SCSU Scholars tackles the theology.

Courtesy Alex Tabarrok, I skimmed this paper from a 2005 NBER conference which shows the history of opprobrium heaped upon speculators. And yet even in the first book of the Bible there was speculation. If you saw "Joseph and the Amazing Technicolor Dreamcoat", it's in the second act. Pharoah has had a dream in which seven gaunt cows devour seven fat ones, which Joseph interprets as the feast-famine cycle. (Genesis 41.)

I use that passage to motivate U.S. farm policy. On one hand, a tax rate of 20 percent appears to be Divinely Inspired. On the other hand, technocratic intervention also appears to be Divinely Inspired. King continues,

You might argue, I guess, that Joseph was kind and gave away the grain, and he did, but later he trades grain for the entirety of the flocks of the people, acquires land for Pharoah, and gives them seed and collects a 20% tax. If you're a student of economics, try drawing the supply curve for grain in Egypt in Joseph's time for the seven fat years and the seven gaunt years, both before an after Joseph's speculation in the grain market. What differs between this and the action of onion futures traders? Oil future traders? (This example inspired by a question in Heyne, Boettke and Prychytko.)

The LORD passed on the opportunity to inspire the Cairo Board of Trade: more evidence that He Workf In Myfterious Ways?