Market Bubbles: How Many Boats are We On?

[poorboy]

Errol you have been running around saying the crash is coming every time the markets have climbed the last 10 years. As long as you are consistent, you might be right some day. I think you are a pessimist by nature or very conservative which certainly clouds your view.

What I think you are missing is the amount of money printed. Todays $7-8 wheat is the same as $6 wheat 5 years ago and $4 wheat 15 years ago. Just like todays $700,000 tractor is the same as a $350,000 tractor 15 years ago.

With costs up on everything else there is no reason to not think these 20% higher prices are not the new normal. Crops like canola are up way more than 20%, so they will probably correct back to the new normal of $13.50-14.50/bus, but no reason to fall below that.

In my opinion fall grain prices are ok, but not record breaking when compared to historic numbers.

[redleaf]

Canola has a bit of a run up in price, goes from 11 or12 dollars......everyone thinks farmers are rolling in cash.
A sheet of beaver puke (OSB) goes from 12dollars to 60 ....there’s no inflation.

[15444]

Markets haven't even come close to peaking yet. The huge number of people in US that are going to invest their $1400 in the market, won't come around till the end of the month. Have small positions in lots of meme, bitcoin and tech stocks that are going to be the big playpen in the next month. Novice traders don't play in ETF's and Indexes. Also lots of Redditors are waiting for GME to drop back to the $40 range to pile back into it - it will be a yo-yo stock for the considerable future. Guys who don't get greedy on the high side of the gamble have done very well with it.

[fcr]

Back in the eighties they owned alot of land in saskatchewan.Then the prov. govt brought in a law against foreign ownership so they had to disperse their holdings.We were leasing 8 qrts from them for many years, they were great to deal with.Neighbour and two sons were expanding at any cost and bought it for way more than its value.They borrowed from FCC , made a few payments then ran out of money.Went to the Farm Arbitration Board , had the loans wrote down then bought back from FCC for less than half of what they paid.Sold that land to investors 6 years ago for a couple million.It was all hush/hush at the time as the local MLA who was a family friend was involved. Still pisses me off to this day.

[macdon02]

For everyone arguing about the amount of money printed, let's look at the inverse, taxes and cost of goods and soon interest rates, and the amount put towards credit or mortgage debt. Now how much disposable income is left for investing. Yes there's been a tremendous amount of debt taken on by govt but between job destruction and everything else, how much is actually left to invest with? Poor people don't invest only the rich do and their confidence is broken, because they believe they will be robbed thru taxes.

[farming101]

so they will probably correct back to the new normal of $13.50-14.50/bus, but no reason to fall below that.

1986, wheat will never go below $4 again. That's what they said anyway.....

[TOM4CWB]

1986, wheat will never go below $4 again. That's what they said anyway.....

Just like black oil went negative last yr.

Volatility is King... if we step in front of a speeding freight train...

The trick will be to figure out when it will run out of steam... and start rolling back... half way up a big mountain pass!!!

Cheers

[Old Cowzilla]

News people seem to find lots of folks who have used up their savings and maxed out the credit cards in the last year. Don't think $1400 bucks goes as far as it used to, lots of people spend that much for rent every month. Or are the employment numbers that far out of wack that things are much worse off than we think. $1400 bucks wouldn't buy a rad for my old tractor.

[Austrian Economics]

What we call "bubbles" are a function of the rate of interest, the exponential increase in debt due to our use of fiat currency, and the reaction of the marginal borrower to rises in the rate of interest. Once enough marginal borrowers cannot afford the uptick in interest charges, the market starts collapsing.

This Zero Hedge article goes into the process in some detail. With the 10 year treasury up to 1.75% now, I think we're close to the popping phase.

https://www.zerohedge.com/markets/what-interest-rate-triggers-next-crisis https://www.zerohedge.com/markets/what-interest-rate-triggers-next-crisis

[SASKFARMER]

Here are some fun facts from Canada this morning. The price is dropping because we have no supply coming to the market. Yes, farmers with a little canola in the bins aren't selling to the companies so they are driving down the price. Funny lumber is in tight supply and the price is double to triple. Round up I was told yesterday is in short supply so the price going up on all big boy totes.

Funny everything else goes up when the pipeline is empty.

Nope, not for farmers, we have to put a squeeze play because they have paid for spring and well they will eventually need to sell.

Grain markets don't work.

Good thing I liquidated a week ago. But this sucks.

The next Bullshit will be Canada will seed 22 million acres so the price has to drop such a big crop on its way. Then the BS from crap reporters the crop is on its way. Price drops some more.

It's a ****ing game.

Notice very little talked about the low snow and rain events since last August.

Nope, not a word. But were going to grow a huge crop.