Riddle me this. How is the global economy liked a tricked out Camaro? Answer: they can both zoom forward providing enough gas is in the tank.
Unfortunately energy resources are finite. And in an effort to keep both moving forward the US government threw its legislative heft behind what some call a giant boondoggle. We’re talking about ethanol.
As you probably know, ethanol is a fuel derived from corn. Due to attractive government incentives farmers have planted a great deal of it. Trouble is, they did so in lieu of wheat, soybeans and other staples.
Subsequently, consumers are struggling with surging food prices while doubts are growing over ethanol’s benefits.
So, if you agree with the Fast Money traders that ethanol is a corny idea that could be soon be phased out - here’s how you might trade.
Look at Tyson because their feed costs should go down, says Karen Finerman..
Or the refiners, adds Pete Najarian, because their margins could improve.
Check out Pepsi, says Jeff Macke. Corn goes into many of their snack products and the end of ethanol should relieve costs.