Weather and recovery

[william the wie]

With the rest of the world losing crops due to weather and US crops like to be at least average will the US dollar take off like a rocket and choke off recovery? I don't know not being a farmer but a bidding war for available supplies seems likely and available supplies are disproportionately denominated in US dollars. Sinking currencies could cause major problems for the BRIC nations.

 

[Revere]

I hope American farmers have a spectacular growing season.

Can it be said other countries with failed crops will be addicted to American agriculture?

Is that a bad thing?

 

[william the wie]

I hope American farmers have a spectacular growing season.

Can it be said other countries with failed crops will be addicted to American agriculture?

Is that a bad thing?

The USD skyrocketing will hurt every industry but agriculture and could set off an epic bond bear in the US bankrupting many of our states. It is not all good news in the least.

 

[Revere]

So we need a weak dollar to keep the debt bubble from bursting?

 

[william the wie]

So we need a weak dollar to keep the debt bubble from bursting?

I would think so but bonds ain't my thing. If China and Japan have to draw down their holdings in treasuries to buy groceries interest rates should spike despite a stronger dollar. Russia was the main breadbasket of the old world up until roughly 1915 and Turkey's entry into WWI. It has only partially recovered from collectivization so if expected worse than usual spring floods on the Don and Volga then that means a huge hunk of the world's winter wheat crop will be destroyed. Drought in Argentina and flooding in Brazil means a shortage of soybeans, sugar and coffee. Potato, maize and rice production may or may not be OK, tea may or may not be fine, likewise sugarbeet production. Corn syrup and Cocoa is not doing fine. I just think it unlikely that mashed potatoes and grits are going to substitute for noodles, bread and possibly rice in a happy way.

 

[Revere]

This debt monkey has to get off our backs one way or the other. Better this than crash the currency by pursuing inflationary policies that destroy Americans' livelihoods.

 

[william the wie]

This debt monkey has to get off our backs one way or the other. Better this than crash the currency by pursuing inflationary policies that destroy Americans' livelihoods.

Not going to argue for that either. However the major problem is the 10 or so top twenty banks considered too big to fail and from the evidence too stupid to succeed. They are a net deficit to the financial system. Getting the Fed to turn them over to federal bankruptcy court when interest rates spike is the only way to avoid inflationary policies.

Then there are the self-destructive states. From the results IL is the worst case, since Chicago still has a functioning barge canal that connects the Great Lakes to the Mississippi there is no blindingly obvious reason why it should be failing but with the next two biggies there are. NY forgot that its main reason for prosperity was transshipments first Albany did not upgrade the Erie canal and then NYC refused to containerize its port. CA ran off its movie industry in the south with taxes and in the north Silicon Valley is slowly relocating mostly to Austin and Seattle that is another nail in the CA coffin. Other states have other problems but those three are headed for default, which is survivable but federal help may attempt to avoid that and end us up somewhere else that is not survivable.

So I see rising exports as an excuse for DC to run the printing press and that will be a disaster.

 

[william the wie]

Self-immolations as food price protests seems to be growing throughout North Africa. It started in Tunisia and has spread to Egypt definitely with reported cases in Algeria and Mauritania.

 

[waltky]

Granny says a lotta people talk about the weather - but nobody don't do nothin' `bout it...

Weather experts predict major flooding in Midwest
18 Feb.`11 - Millions of people in the Midwest are at risk from major flooding this spring, according to a forecast being released Friday by the National Weather Service.

A huge part of the north-central USA, including the cities of Minneapolis-St. Paul, St. Louis, Sioux Falls, S.D.; and Fargo and Grand Forks, N.D., could see "significant" flooding. "Excessive precipitation, mainly in the form of snow, coupled with continuously frigid temperatures, has yielded a thick snowpack in much of the upper Midwest," says Lynn Maximuk, central region director of the National Weather Service in Kansas City, Mo. "We expect significant flooding when this snow begins to melt."

Forecasters say the flooding could start as early as mid-March and last well into April. For the third straight year, experts are warning of "moderate" to "major" flooding along the Red River of the North, which would again swamp the flood-plagued city of Fargo, N.D., and its neighbor across the river, Moorhead, Minn. In Cass County, N.D., which includes Fargo, Sheriff Paul Laney described the latest flooding predictions as "concerning" and "spooky."

"We've always been able to win, we've always been able to fight it," Laney said. "We'll continue to fight it, but every spring brings out its own new set of rules to the game." Fargo has received almost 5 feet of snow this winter — nearly 2 feet above its average for an entire winter season, the weather service reported. That comes on top of summer and fall rain that was 50% above average.

Forecasts for much of the region continue to call for a cold and snowy remainder of February, which will cause the snowpack to grow. In March and April, as temperatures rise and the snow melts, frozen ground and saturated soil will enhance runoff, causing streams and rivers to swell. So, with floods in three straight years and four of the last six across the region, what's going on?

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[william the wie]

I would say all non-flooded farmers will make a mint off this constriction of supply.