Pork Bellies
Categories: Trading
Okay, you must see Trading Places. One of the finest finance-y films ever. And a must-see if you're doing anything on Wall Street. Pork bellies are the star product in the film; they're the commodity vehicle through which the stuffy Street firm trades to make profits.
In practice, they are "standard," in that all pork bellies are treated as if they are about the same weight, fat content, size, location, etc. The industry basically manages a prototypical belly of, say, 73 pounds. That's standard, and on average over high volumes, that's about where they run. They are yet another commodity, traded along with coal, and copper, and bauxite, and Brent Crude. They're a good staple, in that they're not all that economically cyclical. You'd have to feel pretty poor to not...eat. Especially bacon.
