The Death of Inflation

[LEP]

[QUOTE=Richard5;485574]

errolanderson;

Something is missing from your 'bubble' 'lack of inflation' theory:

Housing, Real estate, farm land, farm inputs, grain prices, livestock, food prices, minimum wages, equipment cost, virtually all 'real assets' have increased significantly over the past 5 and 10 years.


IMO, the main reason all of the above has increased is because money seems to be very easy to obtain and interest rates are low. You never used to be able to finance inputs 20 years ago and now you really don't have to Although farming profits have been very strong for the best of the best, my accountant tells me some it is very common to have 13000 acre farms with 18 mill debt and worst case they have seen is farms larger than 20,000 acres have over 40 mill in mtg debt, lease all the equipment (which is just a different form of debt). These farms also have had significant losses on financial statements in 5 out of the last 7 years.

My question would be if farming has been good for the past while (and I feel it has), why such large debt? What don't they understand about the position they are in or are they driving down a road in a big snow storm. Buying new equipment every year doesn't make you any more money but it appears for some, this is a significant mental disease.

There will be a huge day of reckoning soon for some.

Hmm. I thought FCC and the banks are turning down farmers with equity and encouraging them to sell to BTO's? (Sarcasm)

[Guest]

Wow... Into BMO alone for ~16.5 Million...

I see they paid out Input Capital, and CCGA with a restructuring of this debt in 2018. Restructure initiated in 2018, and they as of late last year, owe more than they initially recieved. Nice...

they were outstanding young farmers winners though in 2013
really important fellas

[jazz]

they were outstanding young farmers winners though in 2013
really important fellas

The curse...

[Taiga]

You are only a BTO when you have over $230k balance owing on a credit card.

[Guest]

when you look around , as a farmer or as a landlord , i might add
and you ask yourself , "how in the hell are they doing it" ? well heres your answer
sometimes top dog , or top dollar aren't everything

[shtferbrains]

Commonly refered to as keeping it all up front.

[ajl]

Absolutely, look at this cluster-*** insolvency, banks are/were just handing money out with very little regard to profitability. I guess the shine wears off every OYF eventually.

https://www.bowragroup.com/kalcofarms

Farming has been pretty nasty in this area for the past 5-6 years. Used to be one counted on 50-60 bu canola routinely but the average has likely slipped under 40 from the past five years due to ongoing poor weather. (That is why canola is $16) There has been a lot of unseeded acres, drying costs and spring harvests ongoing in this area and these guys were farming a lot of rented land as I only counted 10.5 quarters on the asset list. A lot of land was bought by speculators in the industrial heartland around Ft Saskatchewan and that was a lot of their land base, Rented land has not been profitable for years but some of it is now after the price rally if you did not have to sell last fall to catch up on rent payments.

[Richard5]

Absolutely, look at this cluster-*** insolvency, banks are/were just handing money out with very little regard to profitability. I guess the shine wears off every OYF eventually.

https://www.bowragroup.com/kalcofarms

I can't say if I am laughing or not but it is truly funny that this is the farm that makes the cover of every Ag publication. Twitter account probably even a website that say how they "grow food to feed the world". All fake and show, absolutely disgusts me.

[helmsdale]

I can't say if I am laughing or not but it is truly funny that this is the farm that makes the cover of every Ag publication. Twitter account probably even a website that say how they "grow food to feed the world". All fake and show, absolutely disgusts me.

Being a 2013 OYF alumni they really bought into the mantra. Their website has ALL the catch phrases.

Heavy emphasis on:
-scale
-efficient
-innovative
-sustainable
-technology
-education
-networking
-"partnering for growth"

-" We are constantly searching for opportunities to partner with others through innovative relationships or investments."

Each to their own...

[Guest]

and "lean management"

[Ab7]

and "lean management"

Those interest rates seem pretty steep

[blackpowder]

I can't say if having a positive attitude is a bad thing.
But it is when you don't learn from being kicked in the gonads or are kicked too late.
It can become a dangerous bias.