Hi Julius,
I really think that is a red herring.
Let's face it, if you own land and its ag value is 4,000 to 8,000 an acre and you have a tractor that is 75,000 to 350,000 and a seed drill that's another 75,000 fertilizer can double and the land is going to get planted!
Governments do tax every acre and it must be productive to cover the costs of sitting barren.
If it gets down to the farmer doesn't have funds, that's what banks are for. Give the loan, with the stipulations that crop insurance is bought (which happens anyway for farmers with the cash) and pre-sell 50% of the crop to the local coop. The US government has all those programs alive and working well! The "farmers lobby" is strong!
They said the same thing last year too, and every acre in my part of Wisconsin was planted.
That's not to say it does not stress and stretch our farmers, but the market adjusts for greater input costs resulting in greater product prices upon harvesting and selling.
That does not suggest that overproduction will not result in a declining price.
One thing about a finite amount of ag land, some of which is being converted into concrete in many places, coupled with a growing world population, it just does not link up to the alarmist's market priced event.
Every year some author wants a "alarmist title" on an article that is filler. IMO
The other one is "long term" and special finance" auto loans will create loan losses for banks and a market drop in used cars prices.
It just never seems to happen.
Mediocre Journalism on display. IMO
Just an observation I've noted.
Merry Christmas and a "THANK YOU" for the many wonderful articles you link all year. I can tell you read and search a lot every day. I do appreciate the result of your studies.
Bob |
