How many farmers do you talk to IRL?
Are the doing large crops, hay or what? Do you personally interact with ranchers at all?
Financial Crash (2022-25)
- Thread starter Cynllo
- Start date
Are the doing large crops, hay or what? Do you personally interact with ranchers at all?
I only know row crop farmers. Livestock is either dying out, due to corporate farming, or is just sort of a side business within the farm to even things out and find use from unfarmable ground, other than CRP. I don't know any ranchers, per say, at least not well enough to say what is going on with ranching.
Row crop farmers, which in the USA is mostly soybeans, wheat and corn, are getting absolutely crushed. Aside from Trump bailing them out, they will go under very soon. Putin is flooding the grain markets, knowing it will destroy our agricultural business and it is working. I talked to the guy I know best and his bank is the largest ag bank in the state. They had a giant ag-finance conference to discuss the situation. Right now, with projected input prices (fertilizer, seed, spray, fuel) and then subtract production (the grain prices expected on the market AND expected yields based on historical value) the numbers shockingly bad.
They expect farmers to lose about $54 for every acre of soybeans they plant and to lose over $100 for every acre of corn they plant. Meaning farmers are going to farm this year, with the expectation to lose money. And it has been this way for a few years. Most farmers are maxed out on credit lines and if this isn't fixed quickly, then ag will simply go under. If ag goes under, this country goes under. Trump did bail out farmers last time he was in office, so we must pray he does it again.
With inflation, soybeans should be between $14 and $16 a bushel and corn between $6 and $8. Right now they expect $9 to $11 for soybeans and $4 to $5 for corn. Farmers are getting destroyed and I don't know if anyone with any power is even aware of it.
These outrageous farming prices are a consequence of going to war on the energy sector. Without cheap fuel, farming is simply impossible to do profitably.
This combined with inflation raising costs of inputs, and the article I posted a while back about Putin flooding the grain market, keeping crop prices extremely low. Add in Brazil becoming more and more fruitful with technology reaching Brazil and allowing them to get two crops in the same calendar year and farming is going down the tubes in the USA.
Either Trump bails farmers out or a lot of farmers will start to go into bankruptcy over the next few years. I pray that he does, he bailed farmers out in his first term, and it was very helpful to them.
Sure energy prices went up because of retarded leftist green policies and war, and money printing, etc. But in the broader historical context prices for oil and gas are normal rather than absurdly high so I am not convinced it is the main reason for the crises in farming profitability.
The first graph is crude oil prices and the second graph is natural gas prices.
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These aren't the full measure of energy costs. Look at historical gas and diesel prices.
Gas pump prices:
Diesel: https://agtransport.usda.gov/Fuel/Historical-Diesel-Fuel-Prices/u2kh-s8ke
As both charts show, pump prices are near all time highs. So it doesn't matter if obtaining the raw product is cheaper. The real problem is that the finished products are far more scarce, and have higher prices as a result.
The reason finished products are scarce is because the (((Democrats))) wage war on the energy sector. For example, the USA has not built a new oil refinery since the 1970s and our old ones are falling apart and being shut down more and more every year.
See: https://www.mrctv.org/blog/chevron-ceo-there-will-never-be-another-refinery-built-us
Chevron CEO: ‘There Will Never Be Another Refinery Built In The U.S.’
Even looking at the charts you posted I am not really seeing the argument you are trying to make.These aren't the full measure of energy costs. Look at historical gas and diesel prices.
Gas pump prices:
Diesel: https://agtransport.usda.gov/Fuel/Historical-Diesel-Fuel-Prices/u2kh-s8ke
View attachment 15389
As both charts show, pump prices are near all time highs. So it doesn't matter if obtaining the raw product is cheaper. The real problem is that the finished products are far more scarce, and have higher prices as a result.
The reason finished products are scarce is because the (((Democrats))) wage war on the energy sector. For example, the USA has not built a new oil refinery since the 1970s and our old ones are falling apart and being shut down more and more every year.
See: https://www.mrctv.org/blog/chevron-ceo-there-will-never-be-another-refinery-built-us
Chevron CEO: ‘There Will Never Be Another Refinery Built In The U.S.’
In the first chart (pump gas prices) from the start of the chart period in 2015 until the end of the period (now) that is a roughly 20% increase in 10 years. That is a lower price increase than most goods and services and less than the rate of wage growth also. Hardly indicating some sort of energy crises.
And in regards to the second chart of on highway diesel fuel prices the price currently is roughly the same as it was in 2008 so basically zero price increase in 15 years. Again I am not seeing how this is a crises yet.
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A 20% increase in gas pump easily translates to 50-60% increase on operating costs per producer. The knock-on effects of cumulative energy prices is far higher than you understand. EACH step of the production chain is increased by the pump price. That adds up to huge price increases if every guy has to raise their prices 30-50%. By the time the goods hit the shelves the price goes up 200%.
For example, the cost of eggs: the grain used to feed the chickens is more expensive because of expensive fuel, which then translates into more expenses for the chicken farms including operating, transportation, and cleaning costs, and these costs are then passed onto delivery companies, which then forces distributors (i.e. grocery stores) to raise prices even more, who carry all these costs and more.
Thanks for proving my point. You have a poor grasp of economic history. Do you know what else happened in 2008? Massive financial crash, bailouts, money printing galore ever since.
Ever since diesel prices have reaches these highs, the US government has had to go into tremendous debt to cover the shortfall, including bailouts of farmers. It hasn't stopped since 2008, the debt since then has gone parabolic.
The energy sector is at the root of our costs, easily understood through the graphs, and the cumulative effects of energy prices over the past two decades has been nothing short of a disaster.
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I agree that only 20% in 10 years is lower than inflation. To me, gas seems relatively less expensive than it has in recent years. Most other things are eye wateringly expensive in comparison. In 2014, a Big Mac cost the same as a gallon of gas. Now a Big Mac costs the same as two gallons.
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Kido Butai
Protestant
I'm considering to buy Bitcoin, precious metals, and stocks which are connected to the S&P...for the purposes of staying with the market and preserving wealth, not beating the market. I notice the Bitcoin price is very high. Is possible to take $500 extra money and buy a share of Bitcoin? Again, I only wish to diversify with my extra leftover money, instead of watching inflation make my savings account lose value.
You tried to make the point that energy prices are high by historical standards but your own data refutes the point.
And the 2008 financial crises happened because of the USA housing bubble not because of high energy prices. During 2012 to 2015 energy prices were at the same level as now (and 2008) and it did not cause a financial crisis.
Your arguments are all nonsense.
Unless you can provide data you are pulling that out of your ass that a 20% gas pump increase results in a 50 - 60% increase in operating costs per producer or a 200% increase in consumer prices.
If anything the reality is the opposite of what you are saying as for most goods transportation is only a small percentage of the total retail price of the goods. For example if I own a business selling t-shirts and I sell each T-shirt for an average price of $30 and it costs on average $1 to get that shirt delivered to my business if the price of transportation increases by 30% (due to higher pump petrol prices) that equates to an increase from $1 to $1.30 in transportation costs per t-shirt.
Therefore If I put the price of my shirt that I am selling from $30 to $30.30 that covers the increased cost. So in this case a 1% increase in price covers a 30% increase in transport costs.
For example according to this table https://www.energy.gov/eere/vehicles/fact-741-august-20-2012-historical-gasoline-prices-1929-2011 gasoline pump prices for consumers increased almost 4 fold from 1970 to 1982. Yet during that period CPI only increased 2.5 fold.
Consumer Price Index, 1913- | Federal Reserve Bank of Minneapolis
Historical data from the era of the modern U.S. consumer price index (CPI)
www.minneapolisfed.org
Even if you make the argument that CPI understates reality (which it does) consumer price inflation was still less than the rate of inflation in consumer energy prices during the 1970s and 1980s when energy prices skyrocketed.
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Buy a share of SPY every month instead, I don't like Jew wall street any more than the next guy but the companies in the S&P sell a tangible product. Bitcoin....who knows what the future holds for it, it's a lottery ticket.
Unless you can provide data you are pulling that out of your ass that a 20% gas pump increase results in a 50 - 60% increase in operating costs per producer or a 200% increase in consumer prices.
If anything the reality is the opposite of what you are saying as for most goods transportation is only a small percentage of the total retail price of the goods. For example if I own a business selling t-shirts and I sell each T-shirt for an average price of $30 and it costs on average $1 to get that shirt delivered to my business if the price of transportation increases by 30% (due to higher pump petrol prices) that equates to an increase from $1 to $1.30 in transportation costs per t-shirt.
Therefore If I put the price of my shirt that I am selling from $30 to $30.30 that covers the increased cost. So in this case a 1% increase in price covers a 30% increase in transport costs.
For example according to this table https://www.energy.gov/eere/vehicles/fact-741-august-20-2012-historical-gasoline-prices-1929-2011 gasoline pump prices for consumers increased almost 4 fold from 1970 to 1982. Yet during that period CPI only increased 2.5 fold.
Consumer Price Index, 1913- | Federal Reserve Bank of Minneapolis
Historical data from the era of the modern U.S. consumer price index (CPI)
Even if you make the argument that CPI understates reality (which it does) consumer price inflation was still less than the rate of inflation in consumer energy prices during the 1970s and 1980s when energy prices skyrocketed.
I don't care much or claim to know much about historical energy prices vs today but as someone who owns a tshirt e-commerce business it's almost comedic that you chose tshirts of all of things to illustrate how energy prices don't affect goods. I cannot begin to tell you how flawed that example is, flawed for any product actually.
Every single thing that goes into procuring, making and selling that tshirt increases with the cost of energy including all of your overhead and business expenses, not just what you pay to the mail to get it to your door I wish that was the case. Everything, you name it, it all goes up with the price of energy and you can say that for any product.
I was using a simplified example to illustrate the point.
I understand that for example the cotton used to make the t-shirt requires energy to produce and process, and so on, but the basic point remains that even if you tally up the energy input costs at all levels of a product its still a relatively small percentage of the total price the consumer pays. If you walk into a Nike store and buy a T-shirt for $40 the the rent paid by Nike, the wages, the taxes, etc are all going to be far greater contributors to the final cost/price of the t-shirt then pump petrol prices or consumer gas prices.
"A study by the Federal Reserve Bank of Dallas in September 2021 suggested that if crude oil prices rose to $100 per barrel for three months before retreating, the spike would boost the annual inflation rate by 3 percentage points in the short term, with the effect fading quickly as oil prices pulled back.
While the price of oil has historically correlated with inflation, that relationship has become less pronounced since the 1970s. The loosening of this correlation is likely a result of the growth of the service sector which uses energy less intensively than manufacturing.
Since oil is a key input in manufacturing and a major cost factor in shipping, oil prices have tended to have a greater effect on the cost of goods than services, which also explains the relatively weak correlation between oil and CPI and the strong one between crude and PPI."
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What Is the Relationship Between Oil Prices and Inflation?
Discover how inflation and oil prices are connected. Explore the cause and effect relationship between them and learn to recognize trends.
Samseau has no empirical evidence to back his claim that energy prices have a huge multiplier impact on consumer goods prices. Yes energy prices have an impact on consumer prices but its a much small impact for most goods than things like wages, rent, taxes, etc
Note the part I bolded. In September 2021 Oil prices coincidentally were around the current price level depending on the exact day you chose. So basically if crude oil prices rise by 35% that would according to the fed have a 3% impact on consumer prices which is again in line with my thesis that energy prices make up a relatively small percentage of the final price of goods paid by the end consumer.
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You're missing the entire argument. You can't see the forest for the trees. You are looking at the illusuion of money and not the value of living in the US regardless of the so-called "debt," and inflation to dollar value ratio. People from all over the world flood here everyday, and with no status or connections and with hard work and without a dollar to their name build little restaurants, food trucks, and service/construction businesses into a middle class existance within a matter of a couple of years.
The US will be the last place to fall and economically fail. And contrary to popular opinion on this forum, we also have the best/most fair legal system in the world. As an outsider, try getting a fair trial when getting into a land dispute with a native born local in Russia or the Phillipines.
At this time I have to start believing that you are an AI bot or a fed that is here to sow discord and distort reality. Tell the truth. How many accounts do you have here? The US has already crashed? This is just an outright lie with no basis in reality.
$120,000 in the upper mid-west for 200 acres is expensive? 3 acres on the Big Island of Hawaii for $40K is expensive? A two-bedroom fixer-upper in the central mid west for 35K is expensive? All deals I've looked at recently. Again, like a computer program of negativity and gloom and doom, leave it to you to find the blackest lining (and the worst real estate deals) in the US... "Run, Rabbit run"... "The sky is falling, the sky is falling."
You are right about our economy being the last to fail. It’s called the dollar milkshake theory.
Yes, as Thin states above. Your second point is marginally relevant, in the literal sense. If you encounter it, by the way, you'll find that it's only that way theoretically (it doesn't really serve you unless you are big in both time and money). Being the best is irrelevant also when the culture is shot; I'm sure you agree. It also is highly dependent on what issue your dispute is.