Food Fight!

As prices for food and fuel leap to breathtaking and unexpected heights, our own dollar is declining in value.
How far can this thing go?

Popular opinion says commodities must fall from here. There’s too much speculation in the price, therefore the prices are rising.

I disagree.

These early days in the world food fight are provoked by billions of Asian and Indian people moving up the pay scale. Their ribs can still be counted, but they’re able to afford a small piece of chicken and a few bits of vegetable on their three bowls of rice each day now.

Here at home the price of a dozen Grade A eggs went up 27% in one year ending in April. I think eggs are going to go much higher until supply catches up.

AgriFood Thoughts says, “Global consumers are eating more chicken and eggs. Annual chicken consumption is up 10 million metric tons from 5 years ago, while that of eggs is up by 6 million tons.”

It takes 2 tons of grain to make one ton of chicken. More than 11 tons of grain is needed to make one ton of eggs because the laying hens must be kept alive year around.

The rest of the world has been watching our television advertising for years now. Billions hunger for what these advertisements have sold. Now the billions have money. They want what we have.

America created money growth the first quarter of 2008 at a 16.7% clip to accommodate the Enronic sub-prime housing mess. This new money supply is way beyond economic growth, and therefore we have inflation in our future.

If we’re not paying for our wars with taxes, then how are the war bills being paid? Debt. And we’re inflating by printing the money to pay bills and interest due on debt. These printed dollars bring us a “hidden tax” in the form of inflation. Inflation is not prices going up, it is money becoming worth less. There is literally an excess supply of money.

Two years ago, it was fashionable to say that the Chinese should let the value of their money go up so Chinese merchandise wouldn’t be so inexpensive here in U.S. stores. Unfortunately, we got our wish. Just when we see food demand rising we realize that Chinese money is getting dearer while ours is cheapening.

As of 2005, gold and silver have been climbing in value in relation to all the world’s currencies. To protect yourself, consider buying pre-1964 dimes, quarters and silver dollars. Call Treasure Island of Fargo at 282-4747 for answers on gold and silver.