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The Real Crisis That Will Soon Hit the US
Forget stocks, the real crisis is coming… and it’s
coming fast.
Indeed, it first hit in 2008 though it
was almost entirely off the radar of the American public. While all eyes were
glued to the carnage in the stock market and brokerage account balances, a far
more serious crisis began to unfold rocking 30 countries around the globe.
I’m talking about food shortages.
Aside from a few rice shortages that were
induced by export restrictions in Asia, food received little or no coverage
from the financial media in 2008. Yet, food shortages started riots in over 30
countries worldwide. In Egypt people were actually stabbing each other while
standing in line for bread.
We’re now seeing the second round of this
disaster occurring in Egypt and other Arab countries today. Thanks to the Fed’s
funny money policies, food prices have hit records. And even the
Fed’s phony measures show that vegetable prices are up 13%!
The developed world, most notably the US,
has been relatively immune to these developments… so far. But for much of the
developing world, in which food and basic expenses consumer 50% of incomes, any
rise in food prices can have catastrophic consequences.
And that’s not to say that food shortages
can’t hit the developed world either.
According to Mark McLoran of Agro-Terra, the Earth’s population is
currently growing by 70-80 million people per year. Between 2000 and 2012, the
earth’s population will jump from six billion to seven billion. We’re expected
to add another billion people by 2024. So demanding for food is growing… and
it’s growing fast.
However, supply is falling. Up until the
1960s, mankind dealt with increased food demand by increasing farmland.
However, starting in the ‘60s we began trying to meet demand by increasing
yield via fertilizers, irrigation, and better seed. It worked for a while
(McLoran notes that between 1975 and 1986 yields for wheat and rice rose 32%
and 51% respectively).
However, in the last two decades, these
techniques have stopped producing increased yields due to their deleterious
effects: you can’t spray fertilizer and irrigate fields ad infinitum without
damaging the land, which reduces yields. McLoran points out that from 1970 to
1990, global average aggregate yield grew by 2.2% a year. It has since declined
to only 1.1% a year. And it’s expected to fall even further this decade.
Thus, since the ‘60s we’ve added roughly
three billion people to the planet. But we’ve actually seen a decrease in food
output. Indeed, worldwide arable land per person has essentially halved from
0.42 hectares per person in 1961 to 0.23 hectares per person in 2002.
It’s also worth noting that diets have
changed dramatically in the last 30 years.
For example, in 1985 the average Chinese
consumer ate 44 pounds of meat per year. Today, it’s more than doubled to 110
pounds. That in of itself is impressive, but when you consider that it takes 17
pounds of grain to generate one pound of beef, you begin to see how grain
demand can rise exponentially to population growth with even modest changes to
diet.
Make no mistake, agriculture is at the
beginning of a major multi-year bull market. We’ve got rapidly growing demand,
reduced production, and decade low inventories.
This is an absolute recipe for disaster.
Good Investing!
Graham Summers
PS. I’ve put together a FREE special
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To pick up
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Oh yeah, the Hillary Clinton speech on the importance of free speech ---- with the 71 year old ex-CIA guy getting tackled, brutalized, and hauled off on camera just 15 feet in front of her for just standing in silent protest...
...Classic!
Have to wonder whether this wasn't deliberate to cloud over the fact that she blurted out some pretty big truths about Egypt and the conditions in the ME, that they're facing resource shortages. I don't think people are stupid enough to believe that such couldn't be the same fate in the US; and, the REAL PTB wouldn't want the US population spooked else it could look way too much like what's happening elsewhere.
++++++++++++++++++++++++++++++++++++++++++++++
If I have said it once...
the 1st amendment is alive and well as long as you are on page with the establishment that robbs you blind.
A political science professor I had coined a pretty good phrase for this: Freedom of speech is the freedom to say what everyone else is saying.
The US is the slickest sales job ever!
Well, yeah, food COULD be a growth industry.
If there wasn't a world war coming around the corner to cull the herd.
Food in hand valuation going way up. Food futures? Not so much.
I think there is too much damn grass! Think of the chemicals, water and land dedicated to grass. If every homeowner put as much effort into using the same effort to growing food, we wouldn't be having a problem now would we?
That would be "lawns." Mine's feeding deer at the moment, so it's not a waste. Little energy to convert into food, for me.
Depends on what type of grass. Far out and groovy.
yup, grass is a ridiculous waste.
Again, depends on who is included in "we".
I call bullshit on this article and on the speculation (by, guess who? Banksters. That's who.) in commodities, especially foodstuffs. We were concerned about food shortages in 1972. Guess what? it's almost 40 years later and most of the human populace is still eating. In fact, many are overnourished.
Find some other way to make money than scaring people with starvation.
You need to get out more. What you see around you in Amerika ain't what it's like in the rest of the world.
2/3 of the world's population lives on $3/day or less. I doubt that the majority of the world is overnourished...
Because: Increased bushels per acre via genetically modified crops, fertilizers, irrigation, machinery - all dependent upon PETRO-chemicals (OIL).
Not just banksters. Can you say government subsidies and ethanol and conservation "easements"?
If you control the inputs and outputs you certainly control costs.
Who gets the food? Those with the most money. Why are they rioting in the Middle East? It ain't just about Democracy.
The Three F's of Population Control:
Fear
Food
Fuel
Which one(s) are not in play?
According to this article, between 2000 and 2012, the population grew from 6 to 7B. That's a 17% increase in 13 years--1.3% per year, average.
Over the same period, the steady increase in crop yields slowed to 1.1% per year. With compounding year to year, that pretty much exactly keeps pace with population growth.
I don't see an argument for increased demand driving up prices since the ratio of population/supply remains constant.
To the extent that supply may have nonetheless contracted, I would guess that it's a result of ethanol diversion of corn, which is probably not accounted for in the aggregate yield data. I still am doubtful, however, that this would skew supply drastically enough to account for the price increases we're seeing across all foodstuffs. The demands of increasing meat consumption might be equally influential, but that much? I don't think so, not over the past year--a single year in which these factors did not meaningfully change.
It just doesn't add up. Hot money makes much better sense.
Bob, you're missing the macro on this.
Input costs are rising. And while this can be traced a fair bit to depreciated US dollars, there's more. I figure energy costs have a big say in this.
Hot money has an impact, but, really, it's only functioning as a leading indicator. Lots of the standard crops have been way over-subsidized. The path that they'd been operating on is very unsustainable.
Lastly, those numbers could NOT hold. Land to support living quarters (and other, such as transportation) eat into available arable land. Eventually population increases would halt the growth in food production; and obviously, a stall or reversal in food production growth would then result in a reductionpopulation growth.
And then there's looming climate change (always has, and always will occur). With more centralized food production areas we're more vulnerable to such events.
Yeah, I hear ya, it's clearly not sustainable. I wish "aggregate yield" had been defined; maybe it refers to a simple average across land in production, but the amount of that land has decreased. I don't know.
Increased input costs bring us back, of course, to hot money. Not that peak oil won't have its way in the relatively near future, not to mention climate change. But the primary input is oil, no? It is widely acckowledged that the rise in prices over the last year has not been demand driven.
Yeah, the big ugly, oil. We're trying to readjust our society to $80/$90/bbl oil when it was created to operate off of $20/bbl oil. I believe that many of the producers actually sucked it in and now can no longer keep from passing along the input costs. And, well, the more people spend on food the less for those other things, like iPods, which then leads to decreases in jobs, which then leads to...
Slinky down the staircase...
Why the four Western Provinces led by Gateway city Vancouver BC is the safest quadrant in the world...
http://seenoevilspeaknoevilhearnoevil.blogspot.com/2011/01/why-vancouver-bc-is-worlds-safe-haven.html
When the economic down-turn slams BC we might see another story. I've spent a fair amount of time up there (wife's from there), and there's a lot of anrgy white male types just ready for their opportunity to "relcaim" their land from all the foreigners.
Housing market has already peaked and started turning down (was able to get my wife out of her house in time). And, as is quite obvious, the housing/real estate market was the primary engine in western nations. As it goes so goes all else. Yeah, CA has lots of natural resources, but their primary customer is the US, and with the US dragging further down AND the CAD rising, well... I just ain't seeing that the blooms on those roses are going to last much longer.
I could be wrong, though so far it hasn't happened. I'm not willing to bet against myself on this one, in which case I figure that I'll be correct about this one as well...
What's going on with the Canadian / Chinese cyber attack up there? http://ca.reuters.com/article/topNews/idCATRE71G0RG20110217
SSRat - thanks for the intelligent post. Your key comment is regarding water. People can live a long time without food or, rather, with very very little food, and in the US at least it is unlikely that many people will not be able to find at least some food, under most circumstances, for a while anyway. But potable water is another matter entirely. Especially in cities. That is what is going to drive people insane - when the tap no longer works. Ten years ago we bought a place in the country with a few acres of good land, plenty of game, and an aquifer-fed unpolluted stream that flows at 300 GPS 24/7/365. Our friends know they can bring their tents and hang out if TSHTF - but they also know that they had better bring tools, energy, a cooperative attitude, and plenty of guns and ammunition. Oh, and they have also been told to be among the first to get here because after we're full the gates are closed, period.
There are so many sustainable forms of alternative energy that could be applied to western farming and water it's absurd. Ultracapacitors already have the potential to replace batteries in all forms, they both improve daily. Already available wind and solar tech alone is enough to move and or produce massive amounts of water. You just have to beat (or team up with) the person next to you. What should everyone do give up?
Just click your heels together...
Why don't you start quantifying the crap that you're spewing? I see nothing of scale, or how scale could be achieved. Words like "massive," without some sort of quantifications are meaningless. You're a walking commerical, no substance. You and all that push two-dimensional thinking are a threat!
Biofuels were going to save us, and Then we find out that they don't do as we were told. Oh, but wait, "switchgrass" will! Never mind the logistics in corraling up the shit. There's that fucking scale issue again...
And all the "storage" "solutions," the high-tech stuff we find out is highly dependent on rare earth metals, which just happen to be, well, rare! And how there's a push on to make them even more rare (mine and use them up)!
Take your head out of fantasy land and travel to some place where people have lived sustainably for generations. THAT'S what we're going to ALL be looking at!
Recently heard some comic's bit about sending someone into the woods with an axe and seeing how fast they could end up generating an e-mail message. And also goes along with a morse coder beating a texter in a communications challenge (http://www.eham.net/articles/11001). Yeah, techonology will "save" us.
Your toys won't be available. Best to grow up and realize this now rather than later. But, it's up to you. All I ask is that you don't take from me in order to feed your fantasies (expect my labor to subsidize your folly).
someone on this board had posted a few of the finer points in being mobile instead of the barracks approach. I'm not sure being surrounded by a bunch of armed "friends" in tents when supplies run low or someone's feeling rambo is necessarily the safest plan. If you can forage, hunt, purify water, and invade other people's nests in a worst case, you might last longer. As long as you have gold and lead.
it is a supply and demand issue...
or...
people are spending more...
either way! GREEN SHOOTZ BITCHEZ!!!! Buy more appl!! apps for coupons, in store!!!!
and the whole 44 million new families living in extreme poverty??? is that an X-Game Competition?
44 million families are planting gardens! MORE ORGANIC GREEN SHOOTZ BITCHEZ!!!!
Food Shortages? There's an app for that.
Not to detract or discourage, but as an Agricultural Engineer, with a doctorate, and having run and setup agricultural operations around the world for the last seven years, I would beg to disagree with the statements made here in relation to precision agriculture.
Yes, it is possible to have aquaponic systems, in which fish waste is denitrified in order that it might be used to provide some nutrition to plants. However, this process is far from sustainable and far from being anywhere near profitable. I could go on why these systems are geared toward press releases, public relations, and getting some dollars out of city folk, instead of actual production of biomass to feed the masses, but I will not. As trying to explain all of this will lead to endless misery, needless banter, and counter banter, and I really do not care if someone gets it or not.
Currently the average age of US farmers is 63. The number of agricultural educational programs in the universities and community colleges has decreased by close to 94 % since the 1960s. We have plenty of trained persons in the agricultural support industries, but we have almost run out of the actual farmers. We do not have the means to train new farmers, and most sons of farmers have left the farm already. I great deal of the good farmland has been turned into McMansions for the urban misinformed, and the price to enter farming is exceedingly high, with very few financial instruments to facilitate this entry. Agricultural production has peaked, and will most likely fall for a decade or so until society decides to invest in farmers and farming on a major scale again.
Water is scarce, and getting scarcer. The argument for desalinization is insane. The cost for an acre foot of water is current about USD 40. The cost to produce an acre foot of water through desalinization is currently around USD 750. This is based on the desalinization plant running now in California along the All American so we can send the water we have to down to Mexico. Example: it takes 3 acre feet of water to grow 125 bushels of corn. The possible revenue is USD 150 per acre, and it costs the farmer USD 140 to grow that corn. If we have to desalinate then it will cost the farmer USD 2250 just for water. Hmmm, that sounds like it will work... Then the next argument is just desalinate for the cities... no hope there.. 80 % of all water goes to agriculture, another 10 % for industrial, so we can get the 10 % from municipal for ag use. Great that would add 11 % production to the ag industry, which will not help much.
Long and short, I agree Food and Water are a major upcoming crisis. Glamorous agricultural myths sound good, but like most things that sound good, they do not work or delivery what they promise. Bernanke cannot quantitatively ease more food out of the air, neither can anyone else. Permaculture, aquaponics, aquaculture, organic ag, etc... all sound good, problem is, they do not produce enough to feed all the people on our planet. These practices tend to reduce overall yield per acre, which leads to less food on the market, which leads to higher prices. which leads to copper plated lead flying about our heads...
My suggestion is get out of the rat hole cities, get friendly with the farmers, get yourself a firearm (also learn to use it effectively), and do what you do, but do it away from the masses. The country folk are just awaitin' for the city folk to come abeggin', and they will be just as friendly and honest as the city folk have been...
Cheers
very lucid comments, thank you.
(are you the original james bolivar digriz?)
We here in flyover country like to grow corn and turn it into fuel which will destroy your car's engine so you will have to buy a Volt so Govt. Mtrs will look good. I wonder if Sen Lugar owns any GM stock. He sure loves biofuels. I wonder if he is spending his week off down on his Indiana farm? Probably golfing with the Monsanto boyz.
Ethanol is considered by most industry folks as the black eye of alternative energy but it's no reason to trash biofuels in general. The yield and mechanical benefits of algae based biodiesel (which can currently be bought or made at home) and biogas which is already mixed into the national NG grid are both amazing, clean and sustainable fuels.
Algae: http://biofuelsdigest.com/bdigest/2010/11/23/military-biofuels-algae-msw...
One of many forms of biogas (all of which enters the national grid): http://inhabitat.com/farts-to-fuel-new-methane-processing-plant-in-green...
Would a CNG (partial biogas) vehicle work for you (this link is also a map)?: http://www.cngprices.com/
BIOFUELS = DEATH!
I mean, WTF? Food or fuel? "God" gave us feet for transportation: fundamentals are Food, Shelter and Water, not Transportation and Shelter (water and food displaced by transportation).
I spent LOTS of time researching on biofuels, as I knew something just wasn't right. I was an only dissenter on a panel of six (5 pro bio-fuelers) and I was readily able to knock down everthing they had to put forth.
That something can, or could work, isn't the issue. The ISSUE is scalability. Because this site is all about the glories of (theoretical) capitalism, folks here should understand that the aim is to INCREASE scale. NONE Of this shit scales! That is, not at any level that's going to do anything other than route subsidies to the controlling elite.
Algae... grows best in sunlight, right? Sunnier areas tend to be drier. Algae need water, right? Oh, yeah, desalination, I forgot... Oh, put these algae farms along the coastlines, OK then, and how much available coastline is there for this? The rich like their beachfront property, as do commerical ports.
Regional "solutions" are fine to contemplate, but anyone pushing stuff to a wider range is a fool- Big Brush painting...
Of the few farmers I know the successful full time professionals I know of in CA dry farm - in Northern CA. Additionally, each of the sources I site has a yield that is a matter of record. I never mentioned corn. Has HB grown healthy food in the desert? Classic western farming is as corrupt as our economic system, I would like to see it go the way of Monsanto - straight to hell. The guard is changing. I haven't bought chain fast food in a decade, I'll gladly pay triple for my food if it's safe tastes better. Did you guys get my earlier posting about trolls for hire, it's a job listing - you too can operate 10 trolls at once:
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I hear old Gomer Pyle saying "Surprise, Surprise, Surprise!"
I'm not sure why.
I'm a Gomer Pyle fan too, how about Gilligan's Island...haha..
mmmmmm....Ginger.
And Mary Ann, my preference.
Threesome. Use your imagination.
Gilligan, the Professor and Mr Howell ???
I knew super heroes were a little different...
People so busy worrying about being broke on the fake money that they forget the crap on the store shelves has to come from somewhere. Amerika is beyond being in trouble. We are off the cliff and falling. Other places are paying attention. Great post.
I'm just an aging drummer boy
And in the wars I used to play
And I've called the tune
To many a torture session
Now they say I am a war criminal
And I'm fading away
Father please hear my confession
I have legalised robbery
Called it belief
I have run with the money
I have hid like a thief
I have re-written history
With my armies of my crooks
Invented memories
I did burn all the books
And I can still hear his laughter
And I can still hear his song
The man's too big
The man's too strong
Well I have tried to be meek
And I have tried to be mild
But I spat like a woman
And I sulked like a child
I have lived behind walls
That have made me alone
Striven for peace
Which I never have known
And I can still hear his laughter
And I can still hear his song
The man's too big
The man's too strong
Well the sun rose on the courtyard
And they all did hear him say
You always was a Judas
But I got you anyway
You may have got your silver
But I swear upon my life
Your sister gave me diamonds
And I gave them to your wife '
Oh Father please help me
For I have done wrong
The man's too big
The man's too strong
meat (at least current production methods) use an unsustainable food, water and energy proportion. We will be forced to eat less meat (not a bad thing) Permaculture, a wide plant and animal variety, perennials, no pesticides, no oil, intelligent water capture, catchment, greywater, and swales is one of the few methods that we can sustain. A lot more of us will have to grow food
"We will be forced to eat less meat "
Who is this "we" and who is going to do the forcing?
Aka: jobs...
Or quit eating. Thomas Malthus anyone?
----desalinization------ There is a very good article on the OIL DRUM yesterday.
I LIKE the Dodge commercial. Support ZH and I buy Dodge. Fair enough
Here's a good diy alt-energy site (greenpowerscience) with plans for a solar desalination still: http://www.youtube.com/watch?v=5GhkOnEO3X0&playnext=1&list=PL67AE97EFCCC...
You don't even need AC to run your pump for your fish: Solar pump (there are many others online): http://www.youtube.com/watch?v=VgkDdTXmYzM&feature=related
Easy and cheap small scale windpower: http://www.youtube.com/watch?v=L1FzkY9qzCE
Don't forget to raccoon proof or you could just trap them and eat some red meat too.
RR, you been warned!