The Looming Commodity Crisis

[cottonpicken]

"problems this is creating for the ag industry"?

Its the best thing thats ever happened.

Inflation is driving this.
To much money is being printed.
Other asset classes cant provide a return over inflation.

This has happened before.
Gold at the start of the seventies 35$.
Gold in the early eighties 854$.

What stopped it?

18% return in the bond market.

Does anyone think the us economy can stomach 18% interest rates this time around?

Are the chindians going to be paid in cheap or exspensive dollars(the external debt)?
Are the unfunded liabilities(at around 54 trillion,medicare,social security)going to be paid in expensive or cheap dollars?
Are the forever wars of the middle east going to be paid in cheap or expensive dollars?


Now-is m3 going up or down?

Wake up to reality.

[wilagro]

cottonpicken: Stay tuned to "As The Stomach Turns" for the answers.

If the so-called experts can't read the current situation accurately, how on earth can the little guy (farmer), read it? We are just along for the ride and have no power or means of control as usual.

Talk about 18% interest...back in 1982, I was getting 18 3/4% interest on 90 day deposits but farmers at the time were going broke paying anywhere from 15% to 28% interest on operating loans and were going bankrupt in droves. We don't want to return to that scenario.

[Fransisco]

No one has control, no one ever did, no one ever will. There are just to many players involved, and that is just as it ought to be.

[cottonpicken]

I seen this four years ago.
I understand it.

Control?
When i was ten years old i bought a horse and after saddling it and trying to ride it i gave up.
My mother, watching from the window, walked out grabed a whip,got on the horse and whipped it into submision.
I then new control was knowledge/courage/strength.

And great grandaddy used to use a chain.

[TOM4CWB]

C.P;

We have trained hundreds of horses... a whip is the last resort with 95% of horses... trust and relationship most times gets much better results!

[Fransisco]

People are not horses.

The market is made up of people.

The the folks in the countries who have treated their people the way your mother and grandfather treated their horses are the biggest villains in history.

[charliep]

Not sure on the reference to whipping horses. The initial reference was to a new group of investors in commodity futures markets that are effectively elephants/not very responsive to changing market conditions. Government can regulate them and that perhaps is who you are expecting to use the whip. Agstar77 is right in that there is not very much individual risk manager/speculator can do (effectively the equivalent of a flee). These unresponsive giants do create opportunities but you need to be cautious.

[agstar77]

The market used to belong to people some scupulous some not. Now the markets sre dependent on computer generated programs . Whether people starve is irrelevant, whether you or I as a producer survive is irrelevant to a computer.

[Fransisco]

Agstar has now entered the twilight zone.

Que the sci fyi music...

[GrainBeetle]

Fransisco:

And how well do you treat your pigs?