“It is our belief that massive price inflation has already begun.”– PR Newswire
Just remember people, you can only store so much food for so long. It is very important to learn to produce and store your own food and learn how to collect and use wild foods around your area. Only a few generations ago, our ancestors had these skills. Very few people have them now. If you do not cultivate a garden, you need to get started. Even if you can grow a few things in pots on your porch, buy seeds and start.
If you do not hunt, you need to get started. Even if you’re just there plinking squirrels, it is still food. If you do not know about wild edible plants in your area, you need to learn. If you do not have some kind of livestock you need to get started. Even if you have just a couple of hens or a pair of rabbits, it’s still an ability to produce food.
It is possible to do it alone, so it is also time to start finding your neighbors who are also the above and sell them your excess produce and harvests. If you can not do the above, you and your family are simply not going get through this crisis as it develops.
U.S. Inflation to Appear Next in Food and Agriculture
October 31, 2009
The National Inflation Association today released the following statement:
“While most mainstream economists such as Nouriel Roubini are warning of deflationary threats to the U.S. economy, it is our belief that massive price inflation has already begun. The Federal Reserve’s policy of massive monetary inflation in 2009 has caused the Dow Jones to bounce over 50% from its low, oil to rise 100% from its low, and gold to surge to a new all time nominal high. One NIA co-founder just saw his health insurance premium rise 16% over a year ago; and the average tuition for a four-year public college increased this year by 6.5%. Prices are rising all around us, yet agricultural commodities have for the most part been left behind and remain at historically depressed levels.
Fundamentals for agriculture are improving on a daily basis. A worldwide shortage of farmers combined with food inventories falling to record lows is setting up the perfect storm for an explosion in agriculture prices. There is a huge opportunity today to invest at the ground-floor into what will likely be one of the biggest boom industries of the next several decades.
Wheat is currently down 60% from its all time nominal high set in 2008 and 80% from its inflation adjusted high set in the 1970s. Corn is currently down 50% from its all time nominal high set in 2008 and 75% from its inflation adjusted high set in the 1970s. Wheat and corn have only bounced 13% and 26% from their 52-week lows this year respectively. While sugar has faired much better and is now at a 28-year nominal high, sugar is still down 70% from its inflation adjusted high set in the 1970s.
With crude oil back above $80 per barrel, we will soon see a renewed interest in alternative energy. This will create increased demand for wheat, corn and sugar which are used to make ethanol and other biofuels. A massive rise in agriculture prices is just around the corner.
We receive countless emails on a weekly basis asking about if Real Estate is now a good investment and if rents will likely climb during hyperinflation. While rents will increase nominally during hyperinflation, they will plummet compared to agriculture. No longer will Americans eat more than most other countries, yet spend less of their income on food. When Americans are forced to pay more for food, it will take away from what they can spend on rent.
The average American consumer today spends approximately 30% of their income on housing and only 10% of their income on food. We expect these numbers to reverse in the years ahead as the U.S. dollar loses its purchasing power. In Germany during hyperinflation, rents fell from 30% to less than 1% of the average households’ expenditures while food rose from 30% to a high of over 91%.
The U.S. is currently the world’s largest exporter of wheat and corn and the fifth largest exporter of sugar. When American consumers purchase food at their local supermarket, they are competing against consumers from all around the globe. As the Federal Reserve prints trillions of dollars out of thin air and causes our currency to lose its purchasing power, Americans won’t be able to afford to eat as much and farmers will be forced to increase their exports to countries with stronger currencies.
You can find the full story at PRNewswire