Futures markets are a mystery. Fortunes are made and lost in these markets, yet most people know little about how they work. In Back to the Futures, agricultural economist Scott Irwin explains why it’s essential to understand futures markets, whether you’re talking about grain, cattle, or the largest market of them all—crude oil. These massive markets lie at the heart of our economy, affecting us all. Irwin’s engaging storytelling style brings the madcap world of futures trading to life, drawing you in by sharing his wild, life-threatening adventures with motorcycles, snowmobiles, race cars, farm equipment, and renegade cows while growing up on an Iowa farm. Back to the Futures will keep you riveted as he explains how to reduce risk in today’s intense arena of commodity trading. Irwin explains the critical role future markets play in our financial system, the role speculators play in making these markets work, and much more.
Commodity futures trading has become a vital part of doing business in America. So, get ready to learn something new–and don’t be surprised if you find yourself highly entertained along the journey!
Futures markets are a mystery. Fortunes are made and lost in these markets, yet most people know little about how they work. In Back to the Futures, agricultural economist Scott Irwin explains why it’s essential to understand futures markets, whether you’re talking about grain, cattle, or the largest market of them all—crude oil. These massive markets lie at the heart of our economy, affecting us all. Irwin’s engaging storytelling style brings the madcap world of futures trading to life, drawing you in by sharing his wild, life-threatening adventures with motorcycles, snowmobiles, race cars, farm equipment, and renegade cows while growing up on an Iowa farm. Back to the Futures will keep you riveted as he explains how to reduce risk in today’s intense arena of commodity trading. Irwin explains the critical role future markets play in our financial system, the role speculators play in making these markets work, and much more.
Commodity futures trading has become a vital part of doing business in America. So, get ready to learn something new–and don’t be surprised if you find yourself highly entertained along the journey!
By the time I saw the Pepsi truck, it was too late. I remember turning my shoulder toward the truck’s big radiator, feeling absolute terror seconds before it barreled into me, going at least 35 to 40 miles per hour. It hurled me 15 to 20 feet into the chilly, early-autumn air.1
My dad saw it all unfold in his combine’s rearview mirror and was sure I had just been killed. Who wouldn’t? It had to be one of the most horrifying moments of his life—and mine.
I was nine years old at the time, and I loved working with my dad on our farm near Bagley, Iowa. We grew corn and soybeans and raised hogs and occasionally cattle. On this Friday morning, October 20, 1967, I wasn’t in school because all students in our small town had been given a holiday for the high school homecoming celebrations. I was a budding sports fanatic and could hardly contain my excitement about the upcoming night of small-town football. I was also anticipating attending the Iowa State vs. Missouri Big 8 football game with my family the next day in Ames, which would become an annual outing. I was a very loyal Cyclone football fan in those days despite their losing ways (and they would lose to Missouri on that Saturday, 23 to 7).
As it happened this Friday morning, something went wrong with the combine we used to harvest corn and soybeans, so my dad drove it into town for service. I tagged along as he drove the tiny (by today’s standards) four-row combine harvester to the Allis-Chalmers dealership in Bagley. We had been farming for a little over a year, and it was one of my mom and dad’s first major equipment purchases. I was the King of the Road during that drive between our farm and town along that stretch of blacktop, but once we reached the dealership and my dad started talking to the mechanics, I headed to the grain elevator next door.Â
A group of retired farmers, sitting in folding chairs, were lined up outside in front of the elevator on this crisp autumn morning. For small-town men like these, the elevator was the Cheers bar, where everyone knew their name. They came to drink coffee, swap stories, and complain about the weather and grain prices.
I was so enthralled by the goings-on of the elevator that I hadn’t been paying attention to my dad. So, when he pulled the combine from the Allis-Chalmers dealership, I was sure he was leaving without me. As I learned later, he planned to drive the short distance to another part of the dealership. I assumed he had forgotten me, so I took off in a flash.
The road in front of the grain elevator, perpendicular to Main Street, was Highway 141. Without looking, I sprinted across the two-lane highway—directly into the path of the oncoming Pepsi delivery truck. The poor driver had no chance to stop. He must have aged decades in those few seconds as his big truck slammed full speed into my scrawny body, sending me flying like a football through the uprights.
The old farmers sitting in front of the elevator were witness to it all, sipping coffee one moment and slack-jawed the next as the truck smashed into the Irwin boy. Later, they told me I cartwheeled through the air, almost as high as the power lines.
I catapulted and skidded over one hundred feet. I’m well aware of the rough distance because when I came to my senses, I was shocked to be facing Chuck Leber’s house. The approximate distance between the elevator and Leber’s place was about half a block. My face ached and was severely scraped, a painful clue I didn’t cover the entire distance through the air. After I saw the truck’s radiator, I woke up moments later, disoriented and lying beside the curb, gazing at Leber’s house.
My dad leaped out of his combine and sprinted toward me. Later in life, he confided he was certain he’d find me dead and was stunned to discover I was conscious once he reached my side.
The closest hospital was about twenty miles away in Jefferson, Iowa, but there was no ambulance service in Bagley in 1967. However, plenty of locals helped, including Fred Hunter, the father of my best friend, Jack. The Hunters ran a small grocery store a couple of blocks away on Main Street, and Fred had some first-aid training from his time in the Marines during World War II. He placed me on an ironing board—their makeshift stretcher—and loaded me into his 1960s wood-paneled station wagon (seriously, just like the one in the National Lampoon movie Family Vacation).
With my dad riding shotgun, Fred drove as fast as that station wagon would go—possibly pegging the speedometer at 120 miles per hour. I was lucid but in shock. I still remember looking out the window, thinking the telephone poles were flying by at light speed. While I never lost consciousness during the drive, I can’t remember any pain. I recall, though, my dad trying to keep me calm while I chatted more than usual—a lifelong trait that served me well as it kept me conscious.
Our family physician, Dr. Thompson, was waiting when we reached the hospital. Getting inside was somewhat of a blur, but I remember laying on the cold X-ray table and the nurses cutting off my treasured green overalls. Those green overalls were my pride and joy—my official uniform on the farm. They showed I was part of a team, and I was proud of what they signified. So, I was devastated when the nurses sliced them apart.
While this was all happening, my mom and younger sister, Jan, were in the nearby town of Yale at the hair salon before the big trip to the Iowa State football game. My younger sister vividly remembers Mom getting a call about my accident—a parent’s worst nightmare. The ladies at the salon brought Mom a cup of coffee, trying to console her. Mom’s hands were shaking so hard that the scalding liquid spilled all over her arm, but it didn’t faze her. She was in such a state of shock that she couldn’t react. I can only imagine what was going through her mind as they left for Jefferson to find out whether I was dead or alive.
It was a miracle I survived and an even bigger one that I was relatively unscathed. Well, almost. I broke my right leg in four places, had a slight tear in my liver, a mild concussion, and a minor cut on my chin requiring four stitches. That scar still taunts me today, reminding me how badly my body should have shattered.
How does a young boy get hit by a delivery truck going at least 35 to 40 miles per hour, get thrown over a hundred feet, and not sustain severe brain damage or paralysis? It was a one-in-a-million survival story, comparable to someone falling from a ten-story window and surviving.
I must have been spared by a guardian angel on direct assignment from God. There is no other explanation for how I escaped with minimal damage, not to mention how I later survived a string of other disasters on the farm. I kept my guardian angel extremely busy through college.Â
If you talk to many people about the commodity futures market, they might scratch their heads, and you guessed it, I am scratching my head. I am always eager to learn something new and so I was very interested in seeing what this book was about. In Back to the Futures, Scott Irwin and Doug Peterson explain the importance of understanding the futures market whether you are talking about grain, cattle, or crude oil. The authors aim to shed light on the mysterious futures market and on the use of hedging to reduce risk, the origins of commodity futures market, and the move from trading pits to electronic trading.
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There are twenty-one chapters and three hundred pages in Back to the Futures. Scott Irwin and Doug Peterson use their own experiences to demystify an often-misunderstood topic. The authors are candid, and the balance of academic rigor, personal anecdote, and professional insight makes it appealing to professionals and novices alike. The subject of futures is what I consider to be quite a "dry" topic, but the authors have done a great job of simplifying the commodities futures market.
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There are no detailed or advanced trading techniques in Back to the Futures, so this book might be more suitable for beginners rather than experts. The authors do not shy away from discussing the controversies that can sometimes be a part of commodity futures trading. Sometimes authors only sing the praises of a particular strategy, but this balanced perspective is a breath of fresh air and makes the book more appealing.
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By the end of this book, I was no longer scratching my head and I hope this will also be your experience. I learned more than I thought I would and can now carry on a conversation about the futures market. From the dedication to Kim to the last chapter, I was pleasantly surprised and highly entertained by the contents of Back to the Futures. I recommend getting a copy of Back to the Futures, if you are remotely interested in getting a better understanding of the commodity futures market. You might even get some laughs along the way.