Cash for Milk Cows

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HerefordSire

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Cash for Clunkers:

(1) plant markup greater than $4,500 to make it seem like a customer is getting a good deal.

(2) increase debt which is the reason we got where we are

(3) crush the trade-in vehicles so people that do not have good credit or sufficient cash can't drive them


Cash for Milk Cows:

(1) allow farmers to receive $2,000 for their milk cow if they are not organicly fed

(2) anyone with a milk cow wanting to stay in business, receives a $500 bail out if they feed their cow organic feed

(3) the trade-in cows must be crushed so farmers with bad credit can't milk them
 
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HerefordSire

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Buy dairy cows before real-estate?

The most cutting-edge beverage around these days may not be a high-octane energy drink or a bottled water with a hint of fruit flavor, but a glass of milk. A perennial staple of the typical shopping basket, milk is currently experiencing double-digit growth in the organic segment, benefiting category performance across retail channels.

Although organic milk has traditionally made up just 2.5 percent of total dairy sales, dollar sales of gallons, half-gallons, and quarts of organic milk in natural supermarkets and conventional food, drug, and mass merchandiser stores for the 52-week period ending Nov. 3, 2007 increased by 13.5 percent, 13.2 percent, and 12.2 percent, respectively, according to SPINS, a market research and consulting firm for the natural products industry.

Similarly, Nielsen LabelTrends found that refrigerated organic milk sold in food, drug, and mass outlets for the 52-week period ended Oct. 6, 2007 increased 20.4 percent, on top of a whopping 32.3 percent surge last year, while during the same period, unit volume grew 18.5 percent, after jumping 23.8 percent in 2006.

http://www.progressivegrocer.com/progre ... 1003690104


The average herd size in the U.S. is about one hundred cows per farm.

http://en.wikipedia.org/wiki/Dairy_farm

300px-Melkkarussell.jpg
 
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HerefordSire

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I am probably wrong, but I sense something is on the verge of breaking. The way I figure it, small to regional bankers are having to come up with the cash for dairy farms to operate while the farmers allows the bankers to attach assets as collateral. So here is where is gets tricky. Regional banks are in for a heap of trouble in the next year starting from right now.

There are dairy farms in all 50 states and Puerto Rico.

Dairy is the number one agricultural business in California, Idaho, Maine, Michigan, New Mexico, New York, Pennsylvania, Vermont and Wisconsin.

California is responsible for 21.3% of the U.S. milk supply – more than any other state. As an example, in California alone dairy is a $47 billion industry employing over 400,000 people.

Rural America and the agricultural economy in general is greatly impacted by a strong dairy business. When a dairy farm spends money locally, it creates a multiplier effect of more than two-and-a-half times the original dollar spent.

http://www.dairyfarmingtoday.org/DairyF ... d-Figures/
 

TexasBred

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I know of a couple of banks getting all their ducks lined up to call the notes on several dairy operators in Texas. Finding buyers for the cattle, equipment, etc. Most are pretty well secured and the market for the real estate should be pretty good but the livestock and equipment won't bring half what's owed against it as there is no market for the cattle or the equipment.
 
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HerefordSire

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Regional banks should be allowed to drop like flies unless I am mistaken. One dropped the other day that cost the FDIC $3B. The big banks received bail outs and will continue if necessary. The majority of derivatives are believed to be still on the balance sheets. The USDA should continue to marginally help dairy farms thereby helping regional banks to an extent. However, massive increases of federal deficits are not politically correct these days. Therefore, I see a bad future for dairies being financed by small and regional banks. Time for a "Cash for Milk Cows" program!
 

john250

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Organic dairymen seem to be struggling as much, if not more, as conventional dairys.
I'm just observing, I don't have personal experience. Something happened as more and more small dairys chose to chase that 2X or 3X price for organic milk. Actually two things happened. The mega-dairies started organic divisions and more small dairies moved to organic. And then the recession came along (thats 3 things), crimping consumers ability to splurge on expensive organic milk.
I hear organic folks screaming to change the rules, because you can have an organic dairy which is a CAFO--where the cows never graze and eat trucked in organic feeds. Supply has gotten out of hand, and the usual ag economics don't care whether it is organic or conventional. Too much supply means the price gets hammered.
 
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HerefordSire

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Notice the phrase "...non-U.S. banks..." below.

CHARLOTTE, N.C. (AP) -- Banking equities analyst Richard Bove said Sunday that it's possible 150 to 200 more U.S. banks could fail in the current banking crisis, putting greater stress on the Federal Deposit Insurance Corp.'s deposit insurance fund.

The FDIC, which insures deposits, may be forced to turn to non-U.S. banks and private equity funds to help shore up the banking system, the Rochdale Securities analyst wrote in a note to investors.

Among the 81 banks closed so far this year -- compared with 25 last year and three in all of 2007 -- were a stream of smaller institutions, many ruined by losses on ordinary loans amid the souring economy, tumbling home prices and spiking unemployment.

The FDIC expects bank failures will cost the insurance deposit fund around $70 billion through 2013. The fund stood at $13 billion -- its lowest level since 1993 -- at the end of March. It has slipped to 0.27 percent of total insured deposits, below the minimum of 1.15 percent mandated by Congress.

Banks' payments to keep the FDIC afloat could eat up 25 percent of their pretax income in 2010, according to Bove.

The FDIC last week seized Colonial Bank, a big lender in real estate development, and sold its $20 billion in deposits, 346 branches in five states and about $22 billion of its assets to BB&T Corp.

It was the biggest bank failure so far this year, and the sixth-largest in U.S. history, expected to cost the insurance fund $2.8 billion.

On Friday, regulators shut down Guaranty Bank, a big Texas-based lender afflicted by loan losses. It was the second-largest U.S. bank failure this year.

The costliest failure was the July 2008 seizure of big California lender IndyMac Bank, on which the fund is estimated to have lost $10.7 billion.

http://finance.yahoo.com/news/Analyst-U ... et=&ccode=
 
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HerefordSire

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The difference in the last year or two and past history spikes in bank failures is the Fed is propping the larger banks up. I got money on a future spike because the FDIC is in trouble.

98115-12503714819142-John-Lounsbury.jpg
 
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HerefordSire

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Look for the Dow Jones Industrial Average to test 10,000 in the short term. This is a psychological number. Here is a link to the regional banks on the Pacific coast where 20% of the dairies are located in California, sorted by market capitalization....

http://biz.yahoo.com/p/416mktd.html
 
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HerefordSire

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Sunlight and milk makes the doctor go away. Why let dairies fail?

Vitamin D - UK Research Says Can Prevent Cancer!

A daily dose of vitamin D could cut the risk of cancers of the breast, colon and ovary by up to a half, a 40-year review of research has found. The evidence for the protective effect of the "sunshine vitamin" is so overwhelming that urgent action must be taken by public health authorities to boost blood levels, say cancer specialists.

A growing body of evidence in recent years has shown that lack of vitamin D may have lethal effects. Heart disease, lung disease, cancer, diabetes, high blood pressure, schizophrenia and multiple sclerosis are among the conditions in which it is believed to play a vital role. The vitamin is also essential for bone health and protects against rickets in children and osteoporosis in the elderly.

Vitamin D is made by the action of sunlight on the skin, which accounts for 90 per cent of the body's supply. But the increasing use of sunscreens and the reduced time spent outdoors, especially by children, has contributed to what many scientists believe is an increasing problem of vitamin D deficiency.

After assessing almost every scientific paper published on the link between vitamin D and cancer since the 1960s, US scientists say that a daily dose of 1,000 international units (25 micrograms) is needed to maintain health. " The high prevalence of vitamin D deficiency combined with the discovery of increased risks of certain types of cancer in those who are deficient, suggest that vitamin D deficiency may account for several thousand premature deaths from colon, breast, ovarian and other cancers annually," they say in the online version of the American Journal of Public Health.

The dose they propose of 1,000IU a day is two-and-a-half times the current recommended level in the US. In the UK, there is no official recommended dose but grey skies and short days from October to March mean 60 per cent of the population has inadequate blood levels by the end of winter.

The UK Food Standards Agency maintains that most people should be able to get all the vitamin D they need from their diet and "by getting a little sun". But the vitamin can only be stored in the body for 60 days.

High rates of heart disease in Scotland have been blamed on the weak sunlight and short summers in the north, leading to low levels of vitamin D. Differences in sunlight may also explain the higher rates of heart disease in England compared with southern Europe. Some experts believe the health benefits of the Mediterranean diet may have as much to do with the sun there as with the regional food.

In the latest study, cancer specialists from the University of San Diego, California, led by Professor Cedric Garland, reviewed 63 scientific papers on the link between vitamin D and cancer published between 1966 and 2004. People living in the north-eastern US, where it is less sunny, and African Americans with darker skins were more likely to be deficient, researchers found. They also had higher cancer rates.

Professor Garland said: "A preponderance of evidence from the best observational studies... has led to the conclusion that public health action is needed. Primary prevention of these cancers has been largely neglected, but we now have proof that the incidence of colon, breast and ovarian cancer can be reduced dramatically by increasing the public's intake of vitamin D." Obtaining the necessary level of vitamin D from diet alone would be difficult and sun exposure carries a risk of triggering skin cancer. "The easiest and most reliable way of getting the appropriate amount is from food and a daily supplement," they say. The UK Food Standards Agency said that taking Vitamin D supplements of up to 1,000IU was " unlikely to cause harm".
[link to www.independent.co.uk]
 
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HerefordSire

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U.S. Farm Profit Plunging on Lower Crop, Dairy Prices



Dairy Losses

“I haven’t talked to a dairy farmer who isn’t losing money,” said Jim Goodman, an organic-milk producer who farms 500 acres about 70 miles northwest of Madison, Wisconsin.

Farms with at least 1,000 cows are losing $30,000 to $40,000 a month, Goodman said. Revenue from dairy products may fall 34 percent this year to $23 billion, while the value of meat animals will drop 11 percent, according to the USDA.

The agency this week said milk and egg prices will fall more than had been expected this year and meat costs will rise more slowly. Milk may decline 6 percent from last year, eggs may slip as much as 16 percent, while meat and poultry’s increase will be no more than 2.5 percent, the USDA said.

Among farm expenses, the cost of fertilizer will decline about 25 percent from last year to $16.9 billion, while pesticides will increase 2.6 percent to $12 billion, according to the government report. Petroleum costs will drop 30 percent to $11.3 billion.

Government subsidies will rise 3 percent in the first full year of a new farm bill to $12.6 billion.

http://www.bloomberg.com/apps/news?pid= ... iipB7fAsxE
 
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HerefordSire

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john250":3n07kty0 said:
When to cut your losses is certainly a consideration these days.

Know when to fold 'em, know when to hold 'em, know when to walk away, know when to run...

...when the dealing is done.
 

GMN

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TexasBred":3nwb1m2v said:
I know of a couple of banks getting all their ducks lined up to call the notes on several dairy operators in Texas. Finding buyers for the cattle, equipment, etc. Most are pretty well secured and the market for the real estate should be pretty good but the livestock and equipment won't bring half what's owed against it as there is no market for the cattle or the equipment.

Thats just bad business for the Banks, hit a person when they are down, makes me sick! Anymore i think this whole world is going to the wolves.

GMN
 

TexasBred

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GMN":2g0kjr0r said:
TexasBred":2g0kjr0r said:
I know of a couple of banks getting all their ducks lined up to call the notes on several dairy operators in Texas. Finding buyers for the cattle, equipment, etc. Most are pretty well secured and the market for the real estate should be pretty good but the livestock and equipment won't bring half what's owed against it as there is no market for the cattle or the equipment.

Thats just bad business for the Banks, hit a person when they are down, makes me sick! Anymore i think this whole world is going to the wolves.

GMN


GMN, I know these bankers well and I can assure you they have already carried these guys longer than their mother's did.
 

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