***OT Hogs, Hags, Ericy, Oil and deflation*** Jon, thanks for that. The pig farmer who was whining that pig prices are the same as back in the early 1960s should notice that there are only a 138,000 farmers today instead of 3 million in the 1950s. The efficiencies are obviously enormous compared with then, so it isn't surprising.
But look at this, the tax bludgers have got the begging bowl out. Maybe we Q! shareholders should apply to the government for a blue ribbon subsidy too.
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Government officials are rushing to the aid of farmers. The newly
elected agriculture secretary in Iowa is commissioning a blue-ribbon panel; the
state attorney general is conducting an investigation into whether hog farmers
are being cheated, and outgoing Gov. Terry Branstad is honking the horn for
federal assistance.
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Haven't they heard of supply and demand. There is a recession around the world so people are eating less meat. So grain and meat gets cheaper. With the Greenhouse CO2, slightly higher temperatures, and genetic improvements, crops are producing massively. They should go into retailing hogs if they think that's where the money is.
Meanwhile, oil takes a dive. Brent only $9.17 per bbl. All time low. Wheeeee!!!!!!! Arab Light matching lows of 4 days ago.
eia.doe.gov
Notice also the pig farmers were whining that in the tightest labour market in yonks they can't get workers or something. So there is no recession if all are working, just an economic retuning from pigs to cdma2000. The guy whose lifelong dream was to be a hog farmer should done some orthogonal wave functions instead. Fancy having a lifelong dream to feed pigs then kill them. Oh well, each to their own.
Don't worry about a deflationary spiral. This is all good news. Cheap oil is good. Cheap ham is good too. Cheap food is good. Cheap cellphones are good. I like to work a small amount to get a LOT of stuff.
There must be as much desperation in the Saudi world as in the Ericy, Hog and Hag Worlds [Hagfish are being made into leather goods]. So prepare for further price drops in oil. They won't be able to orchestrate production cuts because people are too desperate for some money and they know production cuts won't get the price up enough to cover their costs. So they'll have to pump. I think I guessed next week.
Saudi Arabia will win that race. Prepare for a flood of oil. Go for a 10 litre [engine not fuel capacity] 100 octane torque beast Valueman. Get ready for cheap airfares. Best bargains for decades coming up. And cellphones will go right on selling like hot cakes.
This is great!
Maurice
PS: The loss of $14,000 the hog guy had for 250 pigs was small compared with what a lot of people in Q! have lost. |
