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Notes -
Check out this: https://en.wikipedia.org/wiki/Hedge_(finance)#Agricultural_commodity_price_hedging
The original purpose of futures etc was (and remains) to allow productive sectors of the economy to manage risks: if you're a farmer planning to sell some wheat, you can short wheat to limit your losses in case the price is lower than expected; if you're a baker who will need to buy some flour in the future, you might go long on it in case the price rises. Speculators provide liquidity--they compensate those farmers and bakers when things go south and buffer the losses. Some prediction market component is applied automatically, as some speculators would physically stockpile resources.
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