Inflation

[macdon02]

So there's 3 kinds, asset, demand and currency. Gov't of Canada measures demand and it's about as dead as a rock. Simply because there's zero incentive to run out and buy food or gasoline or rent an apartment. ( Owning a home isn't included in this). So since 2008 what we have experienced is asset inflation, your farmland, the house, not sure vehicles and machinery can be included as they mostly depreciate after they drive off the lot. Commodities in general, well all of them have gone down in value. Which is quite interesting since the fed and boc have nuked interest rates trying to spur what they believe is the only measure of inflation. Essentially commods. We have low rates, we have low commods, and we have a currency that is coming off it's highs. Why did Vancouver and Toronto get the boom? Because cad went to .68 and assets looked" cheap" to foreigners. So now we've tapped .83 and there's hesitation but we've turned down again. Does this explain why land keeps going up? It's capital flowing into the country. But ... we had 2 rate hikes and the economy is starting to slow because the masses ran out and purchased everything they had planned for the next several years as it "is gonna get more expensive to borrow". Does everyone see where I'm going with this? We haven't seen demand inflation in farm land since 2012. The currency inflation, foreign ownership is merely starting. What happens when there's a loss in faith of govt and people want to actually touch what they are buying because 40% of their pension, that's legislated to own bonds, vaporizes? Now do you think land can double or triple or ..... what happens if we are not actually warming but cooling? Drought and frost follows cooling, I live at 52.98N lat, I don't give a shit if we lose 50 or 100 miles of trees. If the frost line moves south my land is worthless. And if you draw a line around the globe into Russia there's a significant amount of acres removed from producing foods. Now do the same from the south pole. I'm very off topic but this is what's going through my mind.

[AlbertaFarmer5]

So there's 3 kinds, asset, demand and currency. Gov't of Canada measures demand and it's about as dead as a rock. Simply because there's zero incentive to run out and buy food or gasoline or rent an apartment. ( Owning a home isn't included in this). So since 2008 what we have experienced is asset inflation, your farmland, the house, not sure vehicles and machinery can be included as they mostly depreciate after they drive off the lot. Commodities in general, well all of them have gone down in value. Which is quite interesting since the fed and boc have nuked interest rates trying to spur what they believe is the only measure of inflation. Essentially commods. We have low rates, we have low commods, and we have a currency that is coming off it's highs. Why did Vancouver and Toronto get the boom? Because cad went to .68 and assets looked" cheap" to foreigners. So now we've tapped .83 and there's hesitation but we've turned down again. Does this explain why land keeps going up? It's capital flowing into the country. But ... we had 2 rate hikes and the economy is starting to slow because the masses ran out and purchased everything they had planned for the next several years as it "is gonna get more expensive to borrow". Does everyone see where I'm going with this? We haven't seen demand inflation in farm land since 2012. The currency inflation, foreign ownership is merely starting. What happens when there's a loss in faith of govt and people want to actually touch what they are buying because 40% of their pension, that's legislated to own bonds, vaporizes? Now do you think land can double or triple or ..... what happens if we are not actually warming but cooling? Drought and frost follows cooling, I live at 52.98N lat, I don't give a shit if we lose 50 or 100 miles of trees. If the frost line moves south my land is worthless. And if you draw a line around the globe into Russia there's a significant amount of acres removed from producing foods. Now do the same from the south pole. I'm very off topic but this is what's going through my mind.

I think we both spend too much time reading Martin Armstrong...

Trouble is, when people lose faith in government, and as a result, the currency they create, interest rates will also explode higher, which is not good for land prices, not many investors will be paying cash for land, whereas gold and other commodities can be purchased in smaller increments, not requiring financing. Then will start the push for nationalisation or redistribution of land.

Your last point is literally my biggest concern for our future. It may lead to the greatest commodity boom in history, but we may be on the sidelines looking in, with crop failure after crop failure as we fail to accept the reality and adjust quickly enough to even a marginally shorter growing season. The effect will not just be at the extreme northern and southern latitudes, either, every climate zone will shift closer to the equator, and further down in elevation. The ramifications to the global food supply and energy needs are truly disruptive. I really wish someone was doing credible science on this topic, if they are, I have yet to find it.

[ajl]

Marginally shorter growing season is climate change to worry about. Saw that here with the growing season from May 20 to a frost around Sept 20 that was heavy enough to kill tomatos and zucinni in the garden. Crops did not quite make it with immature frost damaged wheat and green canola. Crops grow more on May 18 than they do on a frost free Sept 18.