Commodity Deflation

[farming101]

Yesterday my nephew was told wheat sold for $6 in 1980. Right away he got on the inflation calculator app and says, "that would equal $17.50 today."
We're already deflated quite enough thank you.

[farmaholic]

My thoughts exactly, but grain commodity prices will probably have to follow the rest of the commodity complex "in sympathy". Even if there is no real need for the deflation! Pawns... man I hate when technical signals move markets when fundamentals would dictate otherwise(not saying that is the case here because I don't do in depth market analysis)

[tweety]

People will always need food. There is at least some comfort in that, at least for the ones who own land.

[errolanderson]

The 1980's were very inflationary. Remember Canada Savings Bonds yielded 18%.

My first Mac computer with the power of a toaster cost $7,500.

But global governments had very little debt. Reagan's debt was miniscule. As the U.S. headed into recession, U.S. air traffic controllers went on-strike. If my memory is right, he fired them all . . . .

In those days, a U.S. recession could be fought with government spending. But today (IMO) government debt is far too enormous for that plan to work, (as markets are now finding out).

Interesting times . . . .

[blackpowder]

And it's become more common place to reward a ceo whose department is guilty of fraud while they fire 5300 underlings.
While the man on the street aspires to be that ceo.
The welfare thinking created by First King Pierre breeds on its own. Gimme Gimme Gimme.

By the way, you're producing a raw commodity for the economic system in which you've resided all your life. Get over it.

[perfecho]

Errol, not a financial guy at all...only pondering..., however was it Reagonomics that lowered business tax substantially and started to put more on the working class? Seems since late 90's, many businesses have had major cash, and buying up other businesses became the name of the game. Have seen that locally within the Nisku oil sector....some actually started companies to bought. (Things have changed in the last year though)
Look at the latest Monsanto deal...wonder how the change in tax (and control) has had on current situation......????

[errolanderson]

perfecho . . . good question and just a personal opinion.

We will see massive changes (shake-ups) in both the financial and corporate world over the next five (5) years.

Many companies will not survive this downturn. Many business names will simply disappear via take-over or bankruptcy. This will stretch far outside our world of agriculture.

An unstoppable train right now . . . .

[foragefarmer]

Errol


"We will see massive changes (shake-ups) in both the financial and corporate world over the next five (5) years.

Many companies will not survive this downturn. Many business names will simply disappear via take-over or bankruptcy. This will stretch far outside our world of agriculture."


This has been going on in business long before you started to predict doom and gloom here on Agriville.

Have you been sitting on the sidelines since you began posting these economic forecasts?

[tweety]

Which brings up the most important question then. What does the typical farmer who owns land machinery grain etc do? What are some wise strategies?

[perfecho]

....The shakeups should have already happened....something out there is stopping it....
(this is where the eerie orchestra and ...dum....dum....dumm..of the drum comes in)

What does a farmer do...IMHO...keep on doing. Pay down debt, don't have high expectations, be happy where your at. The race to be biggest doesn't usually end in contentment, but knowing you can feed your family..(freewheat style), do things you enjoy other than taking out the other guy and make sure you volunteer in something that's worth while!
Now....back to the wine!

[perfecho]

Not saying this is "wise" Tweety...but gratifying....

[farmaholic]

So if a bunch of Companies are going to get amalgamated or "vaporize" what does this do to those pieces of shit called mutual funds. Good blue chip amalgamations wouldn't bother me....the value will get combined but high risk ventures is where "money and value(?)" will evaporate into thin air? We may be entering a time where greater value will be placed tangible everyday necessities. ....like cellphones...buy your Apple and Samsung stock, if it isn't already too late.

I never looked at it the way an Agriviller posted it recently. ....the saver isn't getting rewarded for saving and the borrower isn't getting penalized for borrowing(stealing from the saver and giving Iit to the borrower)...in their words, wealth transfer. Money is too cheap right now. But how can that be changed when a lot of people are leveraged to the max....

The solution is beyond my management skills....