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Tonto say "Kimosabe Get'em Cash Ready"

HerefordSire

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Watch for break of Dow upward trend (right image). If upward trend broken, accumulate only if less than 7,200-7,300 while making shoulder. Will be more specific in regards to sector once she starts dropping like a rock. Don't be the Lone Ranger Kimosabe.

Right shoulder is expected to be lower than shown in image.

 

HerefordSire

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This reminds me of all the environmentalism and special laws which were passed and enforced.

California Collapsing
by Martin D. Weiss, Ph.D. 06-22-09

California is America’s most populous state with 38 million people. Its GDP of $1.8 trillion is the largest in the U.S. Its economy is bigger than those of Russia, Brazil, Canada, or India.

And it’s collapsing.



http://www.moneyandmarkets.com/californ ... sing-34271
 

HerefordSire

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Food shortage coming fast? First article below is in reference to Jimmy Rogers. Next and last article below provide more food info. Based upon this information, a good sector to be in after the market tanks, is agriculture. Even after the market tanks, I intend to protect myself. In other words, I will not buy equities without buying simultaneous puts because there is too much risk on this downturn...such as she could keep going down to 5,300 or so.


Agriculture

Rogers still likes agriculture and thinks it will be one of the best investments in our lifetime. He says so under the premise that the world is growing and so are the number of mouths to feed. The economic emergence of countries that previously did not enjoy protein heavy diets have also spurred this trend on. Add into the equation the fact that supply is not necessarily growing to match demand, and you could have a real imbalance in the future. As such, Rogers likes agriculture and specifically farmland.

In the past, we've covered the farmland investments he has made and have elaborated on his thoughts. His main active investments are in Agcapita Farmland Investment Partnerships (in Canada) and Agrifirma Brazil. His bullishness on agriculture comes down to a simple supply and demand equation imbalance. Food inventories are at multi-decade lows and this is without a ton of major droughts or weather problems. Not to mention, there is a shortage of actual farmers (and not to mention farmland) and Rogers says this can be attributed to the fact that it has been a horrible business for the past 30 years. To see more of his thoughts on this topic, see our post about Rogers' extreme bullishness on agriculture.

http://seekingalpha.com/article/144099- ... sb_popular



The Real Crisis Is Food: Beginning of the Bull for Agriculture

The real crisis is coming… and it’s coming fast.

Indeed, it started last year, almost entirely off the radar of the American public. While all eyes were glued to the carnage in the stock market and brokerage account balances, a far more serious crisis began to unfold rocking 30 countries around the globe.

I’m talking about food shortages.

Aside from a few rice shortages that were induced by export restrictions in Asia, food received little or no coverage from the financial media in 2008. Yet, food shortages started riots in over 30 countries worldwide. In Egypt people were actually stabbing each other while standing in line for bread.

The developed world, most notably the US, has been relatively immune to these developments. For us, gas hitting $4 a gallon was a bigger deal than any hike in food prices. But for much of the developing world, in which food and basic expenses consume 50% of incomes, any rise in food prices can have catastrophic consequences.

And that’s not to say that food shortages can’t hit the developed world either.

According to Mark McLoran of Agro-Terra, the Earth’s population is currently growing by 70-80 million people per year. Between 2000 and 2012, the earth’s population will jump from six billion to seven billion. We’re expected to add another billion people by 2024. So demand for food is growing… and it’s growing fast.

However, supply is falling. Up until the 1960s, mankind dealt with increased food demand by increasing farmland. However, starting in the ‘60s we began trying to meet demand by increasing yield via fertilizers, irrigation, and better seed. It worked for a while (McLoran notes that between 1975 and 1986 yields for wheat and rice rose 32% and 51% respectively).

However, in the last two decades, these techniques have stopped producing increased yields due to their deleterious effects: you can’t spray fertilizer and irrigate fields ad infinitum without damaging the land, which reduces yields. McLoran points out that from 1970 to 1990, global average aggregate yield grew by 2.2% a year. It has since declined to only 1.1% a year. And it’s expected to fall even further this decade.

Thus, since the ‘60s we’ve added roughly three billion people to the planet. But we’ve actually seen a decrease in food output. Indeed, worldwide arable land per person has essentially halved from 0.42 hectares per person in 1961 to 0.23 hectares per person in 2002.

http://seekingalpha.com/article/144675- ... griculture
 

Alberta farmer

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We keep hearing about how agriculture should be profitable but down on the farm we sure don't see it? When our cattle sell for the same price we were getting 20 years ago it is discouraging. In the meantime everything we buy to produce those cattle has gone up. In the long run that just isn't sustainable? We live like dogs so we can feed the city slickers cheaply...so they can buy that new boat, RV, or whatever the toy of the day is?
The fertilizer companies have tried to keep prices up and some farmers have just cut back on using fertilizer. I hope this will drive up the price of grain and what I really hope is the light will come on for some of these guys? Produce less...get paid more for the product?
We need to quit over producing and get back where we supply only the amount that is profitable. I doubt that can be done with the current system of the independent farmer? But just wait until the large corporations completely control the food output...then you will see food prices rising to highs never dreamed of.
 

HerefordSire

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Alberta farmer":s9beahk5 said:
We keep hearing about how agriculture should be profitable but down on the farm we sure don't see it? When our cattle sell for the same price we were getting 20 years ago it is discouraging. In the meantime everything we buy to produce those cattle has gone up. In the long run that just isn't sustainable? We live like dogs so we can feed the city slickers cheaply...so they can buy that new boat, RV, or whatever the toy of the day is?
The fertilizer companies have tried to keep prices up and some farmers have just cut back on using fertilizer. I hope this will drive up the price of grain and what I really hope is the light will come on for some of these guys? Produce less...get paid more for the product?
We need to quit over producing and get back where we supply only the amount that is profitable. I doubt that can be done with the current system of the independent farmer? But just wait until the large corporations completely control the food output...then you will see food prices rising to highs never dreamed of.

The markets are adjusting. The difference in this cycle could be environment concerns. People and lawmakers are very confused between priorities of saving the planet and eating (look at California). The planet and its life cannot be fundamentally altered but they would rather spend billions of dollars on the environment than invest in agriculture because the lawmakers and activists have enough food to feed their families. The forces are just too strong. We know, the system will balance. Once the important chosen ones realize they don't have enough to eat, like those in Egypt mentioned above stabbing each other, the environment will win again just like it has for 4.3 billion years and priorities will change once again just like during the depression years. It is comical that lawmakers and activists think they can change, for good or bad, something that has been around for so long and so powerful.

Back to how to profit from agriculture. Generally, one of two things will happen. Hyperinflation or depression. Hyperinflation will reduce buying power and cause land and commodity prices to go throught the roof. Depression could be good for commodity prices also, but at much lower prices. The relativism is the key. A depression will remove activist and lawmaker thinking and renew the system but hyperinflation won't. I think we need to clean out the system with all the garbage so we can focus on real priorities again, like food and feeding family and neighbors so we don't start killing each other again.
 
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