Commodity Trading - A Mystery

While this news item illustrates the extraordinary influence the - mostly Switzerland-based - Commodity Trading firms have in the markets the real mystery is the profitability of their business model. Given the nature of the business most transactions - if not all - are conducted with counter parties outside of Switzerland. That leads to the questions where trades are booked and taxes are paid. Do the Swiss really care, do the authorities in Geneva and Zug have the resources to police all transactions? Or are they happy with the taxes they receive, following the motto that something is better than nothing. The trading firms could leave at a drop of a hat and decamp to friendlier climes (Dubai? Cayman?) if tax officials are becoming too nosey. And how are these wondrous profits achieved? Most deals are over-the-counter, in physicals. Counter parties are often little-supervised and basically unregulated entities in places that rank very low on the transparency side. Has any of the numerous regulators that harass the financial industry ever shown interest to have a close look at the commodity trading universe? Not to forget the media that could also stop writing fawning pieces on the 'success' that the trading firms have and the fabulous wealth their senior executives enjoy.