FedEx Warning / Repo Rate Spikes . . . .

[biglentil]

For the average Joe, it's not like you would pay interest on your savings account. The bank pays a tiny amount of interest, then charges monthly fees.

$5,000 balance, pay 0.1% interest, or $5/year. Charge $10/mo fees.

No idea on the mortgages though. I've read about zero interest rate mortgages offered in the Netherlands and somewhere else in Europe. Pretty crazy to think that a bank believes its money is safer when lent out at 0% mortgage than anywhere else.

Of couse the banks pay a nominal amount of interest or it could potentially create a bank run. Everyone would start keeping cash under the matress. Only after they have eliminated physical cash can they do that sort of thing. #WorkingOnIt

[errolanderson]

The dangerous addition to cheap money is now a huge threat to the Eurozone and the U.S. Canada is in the crossfire. The Eurozone is already contracting. Heavy cracks are now seen in the U.S. economy. 4th quarter economic readings will not be good.

Ag strategy . . . Sell the carry in the futures, where attractive. Shop the basis. Milling wheat basis has jumped this week as some buyers in a near term squeeze for quality supplies. Talk to your buyers. If you get a good wheat basis, consider replacing with Minneapolis and KC wheat calls as a blend. This captures a better basis and re-opens your price ceiling.

March/May canola offers excellent carry. If you book the carry, use call options to reopen your price ceiling. Canola calls are dirt cheap due to a lack of volatility in the futures. This reduces your price risk to the cost of the call premium, not the whole value of unpriced product in the bin.

This is where I get yelled at . . . . Don’t scuff at the thought that canola can’t go lower, it can . . . depending on factors. Put options are also dirt cheap to protect unpriced product. Be nimble as best as possible, be creative.

Remember, commodity markets are unforgiving and don’t care about cost of production.

[sawfly1]

Thanks Errol and Macdon, good thread . Informative
I will read it again tomorrow.
When the rye wears off and I might
Have a hope of retaining it.

[JoeVance]

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