America will face Riots, Marches, and Revolution

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Food Crisis II

By Chris Mayer



01/24/11 Gaithersburg, Maryland – A story I’ve been warning about for years is making sensational headlines right now.

It’s a story most people don’t realize could make a huge impact on all of our portfolios in a number of ways.

“US Crop Stock Forecasts Deepen Fears of Food Crisis” read a recent Financial Times headline. The US government cut its estimate for key crops. This came only a week after the UN warned the world faces “food price shock.” Corn and soybean prices jumped and now sit at 30-month highs. Inventories are very tight. Corn is up 94% since June!

And the world worries about a repeat of 2008, when food riots erupted in poor countries around the world.

This has been in the works for a long time. It was there for all to see. The ratio of arable land to people has been falling for decades. Gains in crop yields have slowed. Population has expanded and income levels have grown. Diets have shifted. More people are eating more meat, which is much more grain-intensive to produce.

And the love affair with biofuels puts food production in direct competition with energy. Plus, there are water scarcity issues affecting food supply. My readers have made tremendous gains from this trend by owning shares of agricultural fertilizer producers Potash (POT) and Mosaic (MOS).

I should also make the point that this fits in with another topic I’m concerned about: inflation. Now, the man on the street uses the term “inflation” to mean when prices for everything seem to go up. Or put another way, inflation is when the dollars in his pocket buy less. In truth, this is the effect of inflation. The root cause is simply money printing. When you print more money, that money has less value than if you didn’t print any new money at all.

So what we are seeing with rising commodity prices is not only the supply and demand story I led off with. It’s also the effect of paper money losing its purchasing power in the real world of things. This, too, was easy enough to see. Finally, all that money printing – the “quantitative easing” baloney you’ve heard about – is coming home to roost.

Still, it’s disconcerting to see it all playing out. For the sake of our world, I’d rather have gotten this one wrong. But we have to deal with the market we are in. So what might “Food Crisis II” mean from an investment point of view?

Food prices will have to rise: There is no way around this. We are all going to pay more for food. Wells Fargo predicts US retail food prices will rise about 4% this year. Some things will go up much more. Pork and beef could rise more than 10%.

This won’t necessarily mean that meat producer stocks are good buys, because they may not get to raise prices to fully offset the rise in feed costs. Anecdotally, for instance, The Wall Street Journal cited a Minnesota 300-cow operation that reported feed costs had doubled. Plus, I’ve listened in to the conference calls of a number of food producers – Tyson, Hormel, and Sanderson Farms. They all talk about getting squeezed by rising feed costs.

I do think these companies will be good buys sometime this year, because people will adapt and farmers will respond. Producers won’t produce meat at a loss for long. And farmers will bring every resource they have to bear. It’s been slow getting the crops in the ground so far in many places. But ultimately, there is a lot of potential supply from Brazil and the US.

Still, weather is the big wild card here. If we have a drought in the US or in Brazil, this could really get ugly.

Emerging markets are vulnerable: This follows from the above. It doesn’t really faze the typical American to have to pay 4% more at the grocery store. Food is still such a small part of the typical American’s budget. I think Michael Pollan in The Omnivore’s Dilemma points out that the US spends 9% of its income on food, which is among the lowest percentage of any people anywhere at any time in history.

The same is not true in India or China or many emerging markets. In China, people spend 50% of every incremental dollar on food. And in India, it’s more like 70%. So the rising price of food is felt more keenly in these markets.

The price of food is rising faster in emerging markets, too. In India, food prices are up 18% and at their highest level in a year. China has the same problem. Prices rose 5% in November alone. All around the world, emerging markets have a big problem with rising food prices.

Indonesia’s president is trying to get people to grow their own chili peppers. And the South Korean government recently released emergency stores of cabbage, pork, mackerel, radish, and other staples.

I could go on and on.

The point is that the emerging markets boom is not going to go far when it faces a food crisis. Already, the markets are starting to reflect this. India’s Sensex was down three straight days and off 6% to start the year. Other markets also started badly. And if China and India and the rest slow down, it’s going to have a huge impact on all those stocks and commodities most sensitive to emerging market growth.

I’m keeping a close eye on these developments. There will be opportunities in this crisis, as with all others. For instance, though rising grain prices are not good for meat producers or emerging markets right now, it’s a boon for fertilizer stocks. As the old golf saying goes, “Every putt makes somebody happy.”

Regards,
Chris Mayer
for The Daily Reckoning

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Food costs serve up trouble

By Michael T Klare

Get ready for a rocky year. From now on, rising prices, powerful storms, severe droughts and floods, and other unexpected events are likely to play havoc with the fabric of global society, producing chaos and political unrest. Start with a simple fact: the prices of basic food staples are already approaching or exceeding their 2008 peaks, that year when deadly riots erupted in dozens of countries around the world.

It's not surprising then that food and energy experts are beginning to warn that 2011 could be the year of living dangerously - and so could 2012, 2013, and on into the future. Add to the soaring cost of the grains that keep so many impoverished people alive a



comparable rise in oil prices - again nearing levels not seen since the peak months of 2008 - and you can already hear the first rumblings about the tenuous economic recovery being in danger of imminent collapse. Think of those rising energy prices as adding further fuel to global discontent.

Already, combined with staggering levels of youth unemployment and a deep mistrust of autocratic, repressive governments, food prices have sparked riots in Algeria and mass protests in Tunisia that, to the surprise of the world, ousted long-time dictator president Zine al-Abidine Ben Ali and his corrupt extended family. Many of the social stresses evident in those two countries are present across the Middle East and elsewhere. No one can predict where the next explosion will occur, but with food prices still climbing and other economic pressures mounting, more upheavals appear inevitable. These may be the first resource revolts to catch our attention, but they won't be the last.

Put simply, global consumption patterns are now beginning to challenge the planet's natural resource limits. Populations are still on the rise, and from Brazil to India, Turkey to China, new powers are rising as well. With them goes an urge for a more American-style life. Not surprisingly, the demand for basic commodities is significantly on the rise, even as supplies in many instances are shrinking. At the same time, climate change, itself a product of unbridled energy use, is adding to the pressure on supplies, and speculators are betting on a situation trending progressively worse. Add these together and the road ahead appears increasingly rocky.

Breadbaskets without bread
Let's begin with food, the most important and volatile of these commodities. Food prices declined in October 2008 after the onset of the global financial crisis, but that seems to have been an anomaly. The December 2010 index of global food prices compiled by the United Nations' Food and Agricultural Organization (FAO) hit a record 215, one point higher than in the spring of 2008. (In that index, based on a "bundle" of food staples, a baseline of 100 represents average prices in 2002-2004.) Some food products, including sugar, cooking oils, and fats, are now trading substantially above their 2008 levels; others, including dairy products, grains, and meat, are inching perilously close to record levels.

As 2011 begins, food experts fear that, within months, prices for key staples will climb above the 2008 threshold and stay there, causing extreme hardship for poor people around the world. "We are at a very high level," said a worried Abdolreza Abbassian, an economist at the FAO. "These levels in the previous episode led to problems and riots across the world."

Of particular concern to Abbassian and his colleagues is the rising cost of corn, rice, and wheat, the staple crops of billions in many of the poorest countries. According to the FAO, by the end of 2010 international corn and wheat prices were already approaching their 2008 peak levels (about US$260 and $340 per metric ton, respectively).

Analysts attribute the rise in grain prices to growing demand in both developed and developing nations, along with a number of cataclysmic weather-related events and speculation by investors. An extreme drought and fierce fires last summer destroyed a large percentage of the wheat crop in Russia and Ukraine, while heavy flooding in India and the inundation of 20% of Pakistan damaged significant parts of the grain output of those countries. At the same time, unusually hot and dry weather suppressed production in a number of other key farming areas.

What makes the picture look so worrisome today are indications that the severity and frequency of extreme weather events appear to be on the rise. In the past few weeks alone, several such events point the way to serious supply problems ahead. Most significant has been the unprecedented rainfall and flooding in Australia that put an area more than twice the size of California largely underwater, significantly disrupting wheat cultivation there. Australia is one of the world's leading wheat producers. Unusually dry conditions in the American Midwest and Argentina have also hinted at future problems in grain and corn output. It's still too early to predict the size of this year's grain and corn harvests, but many analysts are warning of a shortfall in supplies, along with sky-high prices.

Mainstream analysts and government officials are loathe to attribute this traffic jam of extreme weather events to global warming. Huge variations in rainfall can be normal, especially in places like Australia that are susceptible to El Nino/La Nina ocean-temperature oscillations, and politicians are fearful of assuming responsibility for a problem as massive as climate change. But climate change theory has long suggested that the warming trend - 2010 tied 2005 for the warmest year on record and nine of the 10 warmest years have come in the last decade - will be accompanied by an increase in the frequency and severity of storms. It's hard to escape the conclusion that recent events, including those Australian floods, are tied to rising global temperatures.

The energy crisis returns
Soaring food prices are being driven as well by speculative investments and the rising price of oil. Partly in response to the diminishing value of the dollar, some investors are sinking their money into food futures (along with gold and silver) as a speculative hedge. At the same time, the price of oil is edging toward the $100 mark, making it increasingly profitable for farmers to switch from growing corn for human consumption to growing it for the manufacture of ethanol, which in turn reduces the amount of farm acreage devoted to staples. Oil would have to fall below $50 per barrel to make the cultivation of corn as a food product competitive with ethanol production - and that's not likely to happen. So even if more corn is produced this year, less will be available for food purposes and the price of what remains is bound to rise.

The precipitous rise in oil prices has startled the experts. Not so long ago, the US Department of Energy was projecting a price range of $70-$80 per barrel in 2011, but as the year began oil was already trading above $90 a barrel and some analysts predict that it will reach $100 before the year is out. A few are even talking about the $150 barrel and gas prices at the pump of $4 or more. If prices climb above $100, global consumer spending could take another nosedive.

"Oil prices are entering a dangerous zone for the global economy," says Fatih Birol, the chief economist for the International Energy Agency (IEA). "The oil import bills are becoming a threat to the economic recovery."

As with food, the rising cost of oil is a product of growing demand, insufficient supplies, and speculative investments. According to the most recent projections from the IEA, daily global oil consumption in 2011 will average 87.4 million barrels, an increase of about two million barrels from the first quarter of 2010. Much of the extra demand is coming from China, where a newly minted middle class is buying automobiles at a record clip, as well as from the United States, where previously cautious consumers are slowly returning to pre-2008 driving habits.

At a time when the oil industry is experiencing declining rates of output at many existing oil fields and finding it ever more difficult to add production, even two million extra barrels per day can be a daunting challenge (and greater demand is expected in the coming years). In the United States, for example, much hope was placed in oil exploration in the deep waters of the Gulf of Mexico and offshore Alaska, but in the wake of the BP disaster, this seems like a forlorn prospect. Production in Mexico and the North Sea, two bright spots of recent years, is facing a sharp decline, while other key producers, including those in the Middle East, are struggling to maintain current output levels at existing fields.

Many energy analysts believe that the world is at (or will soon reach) peak oil - the moment when global petroleum output achieves a maximum sustainable daily rate and begins a long-term, irreversible decline. Others contend that higher levels of output are still possible. Whatever the truth of the matter, at this moment the oil industry is finding it increasingly difficult, and ever more costly, to boost output above current levels. This, combined with insatiable demand, is driving prices skyward.

Under these circumstances, speculators are again being drawn into the oil market as a rare sure bet. Such speculators helped push oil prices to a record $147 per barrel back in 2008, but fled the market when prices crashed as the American economy headed to a meltdown. Now, they're coming back.

"Hedge funds and private investors are buying up financial instruments tied to the price of crude, and thereby helping push up oil prices," the Wall Street Journal reported in late December.

Most analysts are expecting a price surge this spring or summer when American motorists hit the road. "We will have a spring rally that will take us to between $3.10 and $3.50 a gallon for gasoline at service stations in the United States," predicted Tom Kloza, chief oil analyst at the Oil Price Information Service.

The rising price of gas will, in turn, hurt consumers just as they show signs of opening their wallets again. No less worrisome, oil-importing countries like the United States, Japan, and many in Europe will face soaring bills for fuel imports, further enfeebling economies already suffering from profound weakness.

According to some calculations, oil prices added another $72 billion to America's balance-of-payments deficit last year. Europe had to cough up an additional $70 billion for imported oil and Japan $27 billion. "It is a very telling story," says the IEA's Fatih Birol of recent oil-price data. "2010 rang the first alarm bells and 2011 price levels could bring us to the same financial crisis times that we saw in 2008."

Rising food prices leading to riots, protests, and revolts, mounting oil prices, mammoth worldwide unemployment, and a collapsed recovery - it looks like the perfect set of preconditions for a global tsunami of instability and turmoil. Events in Algeria and Tunisia give us just an inkling of what this maelstrom might look like, but where and how it will next erupt, and in what form, is anyone's guess. A single guarantee: we haven't seen the last of resource revolts which, in the coming years, could reach an intensity we scarcely imagine today.

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Subtle ways to hide inflation

Downsized
Food containers have been reduced as much as 20% - but prices have not

Sunday, January 23, 2011 03:08 AM
By Tracy Turner

THE COLUMBUS DISPATCH



FRED SQUILLANTE | DISPATCH

Tropicana's 59-ounce carton yields about 7 1/3 8-ounce servings. Nearly identical in size, Minute Maid's half-gallon fills eight glasses at a slightly lower cost. However, according to information on the cartons, Minute
Maid is "from concentrate" while Tropicana is "never from concentrate."

|

No, it's not your imagination.

That carton of brand-name orange juice you bought from the grocery store doesn't go as far as it used to. Neither does your bottle of dish detergent, carton of ice cream or roll of toilet tissue.

Numerous well-known products such as Tropicana orange juice, Ivory dish detergent and Kraft singles American cheese have been downsized, but their prices have not.

In fact, a new Consumer Reports investigation finds that prices are higher in some cases for products that are as much as 20percent smaller than they once were.

Manufacturers are playing shrink-the-package in response to rising costs for ingredients and energy, said Tod Marks, senior editor and resident shopping expert at Consumer Reports.

Higher commodity and fuel costs are expected to cause food prices to rise by as much as 3percent this year, according to the U.S. Department of Agriculture, Dairy and meat prices are expected to rise even more.

"But if manufacturers are skimping when costs go up, why aren't they more generous when costs hold steady or fall?" Marks said in a statement.

Companies often try to hide the change in package size by indenting the bottom of containers or whipping air into ice cream, Marks said.

"It's actually pretty insidious, as the reduction is not enough to be obvious, such as 0.5 to 2 ounces or so," said Chris Raiter, 36, of Marysville.

The trend of smaller package sizes has prompted the married father of two to buy store brands whenever he can as the regular grocery shopper for his family.

"The food manufacturers are saying they are responding to consumer demand, but really, they are trying to hoodwink you a little bit," he said.

"They say consumers want smaller stuff, but we also want the smaller price.

"If they are going to put less of a product in a package, they should charge you less."

Reasons that manufacturers face higher prices include rising worldwide demand for grains such as corn, wheat and soybeans. That has resulted in higher costs for farmers to buy grain to feed their livestock, which ultimately means higher costs for consumers.

And higher fuel costs mean higher product delivery costs.

The Consumer Price Index rose 0.5percent in December, the largest increase in 18months. Much of that was the result of higher gas prices.

Some of the examples of shrinking products cited by Consumer Reports:

• Tropicana orange juice, which has been downsized from 64 ounces to 59 ounces.

• Scott toilet tissue cut its product from 115.2 square feet to 104.8 square feet.

• Hebrew National cut packages of its reduced-fat and no-fat hot dogs from 12ounces to 11 ounces.

Erik Seidel, Scott brand director for Kimberly-Clark, said the company was among the last toilet-tissue makers to reduce the sheet size on it tissue rolls.

"In 2010, all major competitive brands made changes to either the toilet-paper sheet size, or reduced the number of sheets available in their toilet-paper rolls," he said.

Seidel said Kimberly-Clark made changes to its Scott-brand tissue such as adding softness and strength in addition to the "reduction in individual sheet size to help offset rising costs of raw materials required to make the product and to avoid a price increase."

ConAgra spokesman Jeff Mochal said the company didn't reduce its top-selling Hebrew National hot dogs. But the company did shrink the fat-free and reduced-fat packages two years ago as a result of "increased costs to produce a leaner hot dog."

Calls to Tropicana for comment were not returned.

Manufacturers have been shrinking their product packages for years, but the recent recession contributed to even more products being downsized, said Lesley Ware, an editor at Consumer Reports.

"Generally, the manufacturers don't want to raise their product's price, so they make the product smaller," she said. "But the readers that we surveyed said they prefer that a company keep the old package size and increase the price and be honest about it."

Many complaints from Consumer Reports readers were about toilet paper, Ware said.

Chris Sauer of Columbus said he really just noticed the smaller size of the tissue roll last week.

"The rolls are quite a bit more narrow than it used to be," he said. "But I assume they are all getting smaller, even though I think it is one of the most-ridiculous products to cut back on.

"Despite this, it will continue to appear on my 'must-have' list. Since you gotta keep buying it, you've just got to grin and bear it."

So what are savvy consumers to do?

Ware recommends buying in bulk, stocking up when items go on sale, using coupons when available and considering competitors' products.

"Not all companies act in lock step, so take a look at different brands, their prices and their sizes," she said.

"Consumers can also compare the unit price of a product, which is the bottom-line best way to find the best price.

For Pam Hansberger of Norwalk, the answer is to stop buying products that have shrunk.

"You get tired of the excuses these companies make," she said. "When the issues that made the prices go up are solved, the prices never go back down.

"And once consumers learn to accept that, then they'll just keep feeding it to us. My policy now is I've got X-amount to spend on groceries and X-amount to buy. It's the extra things that'll go first."

tturner@dispatch.com

Tropicana 59
ounces
$3.34
at Giant eagle
width: 3.75" Height: 9.25"

Minute Maid 64
ounces
$3.29
at Giant eagle
width: 3.75"
Height: 9.38"

Money-saving tipsTo avoid paying more for less, shoppers can:

• Check out different brands. Not all manufacturers downsize. For example, Minute Maid still sells its orange juice in half-gallon containers, and Ben & Jerry's packs its ice cream in pints.

• Compare the unit price. Look at cost per ounce, per quart, per pound or per sheet to determine the best value.

• Try the store brand, which often costs 25 to 30 percent less than the name brand and often is just as good.
• Stock up during sales.

• Buy in bulk. Warehouse clubs offer low prices on large sizes or multipacks.

• Call or e-mail the company to complain about the downsizing of your favorite products. Consumers who do sometimes are offered coupons as a way to keep them loyal to the product.

Source: Consumer Reports

[Ryan Ruck]

This was just put up yesterday... Apparently some assailants uploaded a video of them targeting and attacking a random person in Shockoe Bottom in Richmond, VA. This is just the latest as you can see from the second video below.

Shockoe Bottom Assault and Robbery Video Taped by Assailants


Shockoe Bottom Club Nights

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Black Gangs Vented Hatred For Whites In Downtown Denver Attacks



'I Hate You F---ing White People,' Woman Shouts At Victim

DENVER -- Black gangs roaming downtown Denver often vented their hatred for white victims before assaulting and robbing them during a four-month crime wave, according to interviews and court records obtained by 7NEWS.

"I hate you f---ing white people," said a black woman in a large group of black men, according to the victim who was beaten up as he and three buddies left a LoDo bar after midnight on Aug. 30.

"F---- you, white boys," the woman added, according to the 25-year-old Westminster victim, who spoke to 7NEWS Friday.

"Why do you hate white people?" the man recalled asking. "That's when I got hit. They beat the crap out of me," he added, saying that 15 to 20 men beat him to the ground.

"They just swarmed you," said the man who curled up on the ground to shield his face. "You basically just had to protect yourself and hope they didn't kill you."

The victim, who suffered bruised ribs and a cut head, said he was protected by a padded motorcycle jacket. He asked that his name be withheld for his safety.

A couple dozen arrest warrant affidavits unsealed Friday offer chilling insights into the 26 racially-motivated "blitz attacks," which stretched from July 17 to Nov. 17.

One unidentified suspect told police "that the members of his gang earn status in the gang by beating up 'white dudes,'" according to court records. He added that the gangs targeted "drunk white guys," exiting bars and nightclubs in the entertainment district.

The suspects allegedly bragged about knocking out white victims with one punch to the head. Victims lying on the ground were "stomped" and even tossed through glass windows.

In the more than two dozen attacks, victims' injuries included a skull fracture as well as broken noses and eye sockets when they were blindsided by punches that often knocked them unconscious. One man was so savagely attacked that he was hospitalized in a coma for a while, police said.

Several of the 35 young male and female suspects arrested by police recently said the gangs often targeted lone white and Hispanic men because they didn't "fight back" and they had money, iPods and other valuable gadgets that attackers coveted.

Another goal: to drive whites away from their downtown turf, including a hip-hop nightclub, according to an arrest warrant affidavit.

The gangs "own that area," one suspect told police.

7NEWS exposed the crime spree in early September when a law enforcement source said the police department was keeping the public in the dark about a series of downtown attacks. The source added that a special FBI task force had been called in to help identify the assailants.

When 7NEWS made a public records request Sept. 3 for crime reports in the area, a police spokesman confirmed the department was investigating a "pattern of assaults and robberies in central Denver" that began in July.

Police spokesman Sonny Jackson denied that police delayed warning the public for seven weeks to avoid frightening visitors to the popular and lucrative downtown entertainment district.

He said police had to confirm "a pattern of behavior" before going public.

But police reports say the gang attack pattern was identified during the summer as the department deployed uncover teams and used surveillance cameras to identify the assailants.

"During the summer months of 2009, a pattern of criminal conduct was identified which included multiple suspects identifying a solo Caucasian or Hispanic male and completing a blitz attack against this party," an officer wrote in an arrest affidavit for a Sept. 4 robbery on the 16th Street Mall.

"Part of the MO involved the group of suspects, usually African American males, sending a party, possibly an African American female, to identify the victim," the officer wrote. "This is done by (the woman) talking with or standing with the victim. A suspect, generally male, from the group will step forward and hit the victim hard, knocking him down. Other members of the group will then emerge and begin participating in beating the victim."

The Westminster beating victim said if police had warned the public earlier, he and others could have better protected themselves

"I'm kind of upset that (police) didn't make it public," said the Westminster beating victim. "I would have been more vigilant. It would have made people a lot more on guard."

But, he added that, "I'm very pleased that they responded the way they did." Within minutes of his 911 cell phone call, uncover officers flooded the scene. He recalled listening to police radios crackling with reports of two suspects being arrested that night.

"I was like, 'Wow, finally they did something,'" the man recalled.

Prosecutors have charged two men and a woman in his attack.

As police pursued the massive investigation involving 35 suspects and dozens of victims, investigators asked the young blacks why they targeted whites.

"Because they got a lot of money," suspect Allen Ford, 18, allegedly told police. Other suspects echoed that simple rationale.

Ford, who was the last suspect arrested in a major police sweep in the past two weeks, allegedly told investigators earlier that he was upset how the robbery spoils were divvied up among members of the Rolling 60s Crips gang and the Black Gangster Disciples gang, according to the arrest affidavits.

Ford, who was arrested Thursday, allegedly griped about "other people getting bigger stuff than me that I would really like to have in my life," according to the records.

At times, older men would chastise young gang members, saying, "Y'all make it seem like a big deal for y'all to be knocking out white people," suspect Denita Mayfield told police. "They all brag about beating up white people."

But the attackers used more than their fists. "The series of crimes has also involved the use of a gun and knife," a police report said.

One male victim recalled a black woman approaching him on the street and saying something he couldn't hear.

"As he was attempting to clarify what had been said to him, a black male came up and stated, 'What the f--- did you say to my girl?'" a detective wrote in an arrest affidavit.

Instantly, the victim was punched.

As he was pounded with blows, the victim said he heard a woman voice shouting, "Get that white boy!" according to an arrest affidavit.

Kendall Austin, 18, allegedly told police that the street gangs "own that area," referring to the 1400 block of 19th Street.

He said they were especially possessive of the Bash nightclub at 19th and Blake streets, saying their purpose was to "keep white people from going to 'The Bash' and to 'let people know not to come downtown without their friends for protection.'"

During an Aug. 2 attack, suspect Allen Ford told police his alleged accomplice, Xavier Francis, tossed a white man through a glass window behind the Bash nightclub.

"I seen him pick the little white boy up and throw him through the glass," Ford told police, according to court records. Police obtained security camera video showing the victim fly through the window.

The Westminster man said after he was attacked, he avoided downtown for a while.

Now he's returned to his favorite LoDo tavern, but he added: "I'm a lot, lot more cautious. It makes me look over my shoulder a lot more."

[Ryan Ruck]

Looks like my hometown is considering getting rid of the police department.

Either outcome they are discussing whether it is merging the PD with the SO or contracting out police duties to the SO will not end well.

Good thing we are pushing full steam ahead with our useless street car program!

City Manager Halts Search For Cincinnati Police Chief

February 3, 2011

Cincinnati City Manager Milton Dohoney, Jr. is suspending the search for the next Cincinnati Police Department chief.

In a statement, Dohoney cited discussions over a merger of city police services with the county sheriff's department. A city council motion passed yesterday directed the administration to pursue talks with the Hamilton County Sheriff on the possibility of the police patrol function being farmed out to the county, as well as a discussion on a total merger of the two departments. A report on the potential merger is due to council April 30.

“It is my belief that no established chief or assistant chief from another jurisdiction would risk giving up their current status to come to Cincinnati when the possibility exists that they could be unemployed if the department were dissolved through a merger,” he said. “To continue our process in light of the current situation would be unwise. Moves to other localities involve entire families, not just the candidate themselves.”

Chief Tom Streicher retires March 7. Dohoney said he will announce an interim leadership plan for the department within the next few weeks.

Those who had already applied are being contacted about the suspended process.

Honestly, I can't wait to move out of this area.

[American Patriot]

My house will be for sale soon.. hehehe

[Ryan Ruck]

Lol!

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Donald Trump: "you’re going to pay $25 for a loaf of bread pretty soon"

[American Patriot]

I think Trump is being a little out there on this. I've heard this before, back in the 1960s, then in the 1970s, again in the 1980s, 1990s and now.

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Corn Prices To Soar As Chinese Imports Increase Ninefold Compared To Official Projections


Submitted by Tyler Durden on 02/06/2011 20:56 -0500

Cotton, wheat, rice, and now corn. If revised Chinese import estimates by the US Grain Council are even remotely correct, look for corn prices of $6.80 a bushel at last check to jump by at least 15% in a very short amount of time. As the FT reports, "Corn prices – and with them, the price of meat – are set to explode if the latest import estimates from China are correct.

The US Grain Council, the industry body, said late on Thursday that it has received information pointing to Chinese imports as high as 9m tonnes in 2011-12, up from 1.3m in 2010-11." Why is this a concern? Because "the US Department of Agriculture, which compiles benchmark estimates of supply, demand and stocks, forecast Chinese imports at just 1m tonnes in 2011-12." In other words, the whole forecast supply-demand equilibrium is about to be torn to shreds. And all this excludes the impact of neverending liquidity by the one and only, which will only make the speculative approach to surging corn relentless.

For those who think that there is any even remote hope of a respite in the endless climb in prices, we suggest reading the following:

The most China has imported in modern history is 4.3m tonnes in 1994-95 and 3m tonnes in 1978-79. For most of the past 50 years, Beijing has been largely absent from the international market, as domestic production was enough to meet demand.

But Terry Vinduska, the chairman of the council, said after visiting China that “estimates given to us were that China is short of 10m-15m tonnes in stocks and will need to purchase corn this year”. He pointed to about 9m tonnes in imports. “We learned the government normally keeps stocks at 30 per cent but they are currently a little over 5 per cent, which may lead to imports of 3m-9m tonnes.”

It is not the first warning of forthcoming massive imports. Recently, David C. Nelson, at Rabobank, one of the world’s largest lenders to the global agribusiness industry, warned that because China’s animal protein industry is so large, the order of magnitude of China shifting to become a net importer of corn could possibly be measured in tens of millions of tonnes, and in just a few years time.

“We note that China could become a net importer of 25m tonnes of corn as early as 2015,” he said. Senior executives at trading houses took note of Rabobank’s forecast.

Is corn set to be another soyabean?

The US Grain Council did not disclose where it got the information and Chinese food import policy is erratic. With corn nearly at a record high, the country could very well opt to further drawdown stocks.

But the forecast of record imports still need to be taken seriously. When China started to import soyabean back in 1995, few thought the country would today be buying nearly 60 per cent of all the global trade in soyabean.

While China waving it in needs little explanation for the observent ones, here's what this means from a third party:

Most of the traders I have spoken to believe that China will become a big corn importer, although none believe it will follow the same pattern as in soyabean. Even so, 9m tonnes is a huge number. Enough to push corn prices above the 2007-08 record of nearly $7.65 a bushel. In early trading on Friday, corn was at $6.65 a bushel.

And with six sigma floods, record cyclones, massive snowstorms and abrnomal climatic patterns now a near-daily event courtesy of the Jet Stream having decided to take a sabbatical, the only thing the grains and softs market needs is a lit match to set the whole thing ablaze. Luckily we have our very own chaircreature doing his best to make sure that the commodities market makes eating an activity best enjoyed by those who will be bailed out by the administration the next time there is a downtick in the market.
h/t London Dude Trader

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Wheat Surges to Highest Since 2008 on China Drought, Middle Eastern Buying

Posted by admin Feb 9, 2011 14:21
| 0 Comment
Audio Download: Nomura’s Rush Sees ‘Robust’ 2011 for Commodities - Feb. 1

Wheat climbed to the highest level since August 2008 as drought threatened to damage crops in China, curbing global supplies, and Middle Eastern and African nations boosted purchases to tackle food inflation. Corn and soybeans also advanced.

The March-delivery wheat contract climbed as much as 1 percent to $8.83 a bushel, the highest price for the most-active contract in Chicago since Aug. 25, 2008. The grain traded at $8.795 per bushel at 3:02 p.m. in Singapore.

Wheat has surged 82 percent in the past year as drought in Russia, floods in Canada and parched fields across Europe hurt crops. Countries in the Middle East and North Africa are accelerating grain purchases as rising food prices contributed to riots and protests. China, the largest wheat producer, is facing severe drought in the main, winter-wheat growing region.

“Wheat is at the center of issues for the market now,” said Han Sung Min, a broker at Korea Exchange Bank Futures Co. in Seoul. “China’s poor crop weather has fueled concern over tightening supplies after some countries in North Africa and the Middle East rushed to secure food.”

World food prices rose to a record in January, the United Nations’ Food & Agriculture Organization said on Feb. 3. China raised interest rates for the third time in four months, effective from today, to contain inflation.
Drought Warning

The drought in China’s wheat-growing regions may worsen “rapidly” as the weather gets warmer, the Ministry of Agriculture said on Feb. 4. The drought affected 35 percent of wheat crops in eight provinces as of Feb. 4, it said.

Wheat jumped as much as 7 percent, the daily limit, to a record 3,051 yuan ($463) a metric ton on China’s Zhengzhou Commodity Exchange, which reopened for trade today after the Lunar New Year break. It last traded at 3,006 yuan a ton.

Chinese wheat output may have dropped to 114.5 million tons at the last harvest, compared with 115.1 million tons a year earlier, according to U.S. Department of Agriculture estimates. Macquarie expects output to drop a further 4 million tons this year. The USDA will update its outlook today.

U.S. wheat reserves on May 31 probably will total 808.3 million bushels, compared with 818 million forecast in January and 976 million a year earlier, a Bloomberg survey showed. World wheat inventories may decline to 177.2 million tons, a survey found, from 178 million estimated by the USDA in January and 197.4 million a year earlier.

The USDA may cut its forecast for world corn inventories before the northern hemisphere harvests to 125.4 million tons, from 127 million estimated in January and 147.1 million a year earlier, the survey showed.

That would be the lowest level of reserves since 2007.

March-delivery corn rose as much as 0.6 percent to $6.78 a bushel and was last at $6.7775. The price reached $6.825 on Feb. 7, the highest since July 15, 2008.

Soybeans for March delivery gained as much as 0.5 percent to $14.415 a bushel and last traded at $14.38. The price touched $14.525 on Feb. 3, the highest since July 2008.

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Sugar Shortage Looms as Storm Ruins Australian Crop

February 07, 2011, 3:58 AM EST More From Businessweek

• Grain Prices Rally Toward 2008 Records on Shrinking World Supply
• China’s Wheat-Area Drought May Last Into Spring, Minister Says
• ‘Heavy Lifting’ Looms as China Rate Below Inflation
• Yuan Seen Reaching 17-Year High on Rate Increase: China Credit
• Commodities to Beat Emerging Market Stocks in 2011, SocGen Says

By Wendy Pugh

(Updates price in fourth paragraph, adds Queensland Sugar comment in 16th.)

Feb. 7 (Bloomberg) -- World sugar output will probably fall short of demand, said Rabobank, after a cyclone with winds stronger than Hurricane Katrina destroyed homes and smashed crops in Australia, driving prices to 30-year highs.

Tropical Cyclone Yasi ripped through northern Queensland, a region growing a third of the country’s cane, cutting output potential in the area by about 50 percent, producers group Canegrowers said Feb. 4. The storm, which the government says may have wiped out at least A$500 million ($507 million) of agricultural production, raised speculation that the world’s third-largest sugar exporter may struggle to match last year’s output that was the lowest in two decades.

“The whole house was shaking and vibrating,” said Gerry Borgna, 53, whose family has supplied cane to a mill at Tully, about 140 kilometers (87 miles) south of Cairns, since the 1920s. “We could hear things flying past and we thought it was part of the house.” At the farm, power lines were lying across the road, a shed stood precariously and cane was pushed over. “To me, this is a disaster,” he said.

Raw sugar soared to 36.08 cents per pound on ICE Futures U.S. in New York on Feb. 2, the highest level since 1980, as the storm bore down on Queensland, and traded at 33.03 cents today.

“On a global basis we thought we would have a slim stock build this year and it is likely that we are going to end up with another deficit,” Rabobank Australia Ltd. commodities analyst Wayne Gordon said by phone yesterday.

Floods, Rain
Australian sugar output may be 3.5 million metric tons from the June to December harvest this year, compared with 3.6 million tons from the previous crop, and down from expectations of 4.2 million to 4.3 million tons, according to Rabobank.

Flooding and heavy rain before the cyclone reduced estimates by about 500,000 tons and Yasi probably cut the outlook by a further 300,000 tons, Gordon said.

Output may be 3.8 million tons next season, Australia & New Zealand Banking Group Ltd. said on Feb. 3, while Commonwealth Bank of Australia commodity strategist Luke Mathews said the same day that the crop may be 3.6 million tons.

“It may well be that the production we saw last year might be repeated,” said John King, chief executive officer of Tully Sugar Ltd., referring to national raw sugar output. “You would like to think we can better that still, but a lot depends on the growing conditions in the next months.” The closely held company is the target of a takeover bid from Bunge Ltd.
Weather Risks

World production may exceed demand by a “small” amount in 2011-2012, though the “fragile” balance will be vulnerable to weather-related risks, C. Czarnikow Sugar Futures Ltd. said Jan. 31. The market will stay in deficit in 2010-2011, it said.

The International Sugar Organization in November lowered its estimate for a global surplus to 1.3 million tons in 2010- 2011 from 2.7 million tons in August after drought and floods damaged fields in Brazil, Russia, Pakistan and Australia.

“Based on what we’re seeing in the meantime, there’s every reason that our surplus will remain very small,” Lindsay Jolly, a senior economist at the ISO, said in an interview in Geneva Feb. 1. “It may disappear.”

The destruction in Queensland from Yasi added to rain and flooding that left 35 people dead and disrupted coal mining. The nation, facing a bill that economists say may reach $20 billion after two months of floods, will need to make budget cuts after the cyclone exacerbated damage, Prime Minister Julia Gillard said yesterday on Channel Ten’s Meet the Press program.

Banana Crop
Yasi also slammed into a banana-growing region representing about 85 percent of Australian production. Woolworths Ltd. raised its prices for the fruit on Feb. 4 and warned the damage would severely affect availability and prices in coming months.

“The region impacted by the cyclone contributes around A$1 billion of agricultural production annually, and initial reports suggest at least half of that has been wiped out this year, including around 80 percent of the state’s banana crop,” Treasurer Wayne Swan said yesterday.

Queensland Sugar Ltd., which handles more than 90 percent of Australia’s exports, said shipments from the 2010 crop were 2.2 million tons, the lowest level in more than two decades. The cyclone and “extreme” rainfall since the middle of last year were likely to keep exports to about the same level next season, company Chief Executive Officer Neil Taylor said today.

Crop Reduction
The 2011 crop is likely to be “significantly reduced,” Queensland Sugar said on Feb. 4. The national cane crush last year was about 27 million tons compared with a usual level of more than 32 million tons, said Brisbane-based Canegrowers in December. The area north of Townsville typically crushes 10 million tons, the group said.

Tully may process about 1.4 million to 1.5 million tons of cane this year, compared with 1.8 million tons last season when the harvest was halted because of the weather, and down from a pre-cyclone estimate for 2011 of 1.8 million to 2 million tons, King said. Output would likely be curbed again in 2012 because of the lingering effect on crops, he said.

“Even putting Cyclone Yasi to one side, it was going to take a couple of years to rebound from the 2010 season,” said King, who left his shelter in the laundry of his Tully home during the eye of the storm to see if the mill’s smoke stacks were still standing before “ferocious” winds returned.

‘Blown Away’
The stacks survived the night, while two cooling towers were on the ground, some sheeting was gone from the roof, a garage was blown away and 35 houses owned by the company had some form of damage, he said.

The Red Cross is using a mill meeting-hall to provide emergency assistance to residents, many living in partly wrecked homes with no electricity.

“We have got off quite lightly from the mill point of view,” King said. The company has until the crushing season starts in June to complete repairs.

Maryborough Sugar Factory Ltd. said in a statement last week it expected a 5 percent to 10 percent reduction in its total company estimate of 4 million tons of cane for the 2011 season. It has mills north of Tully in a joint venture with Bundaberg Sugar Co., a unit of Brussels-based Finasucre.

Cane harvested this year will include so-called standover material left from 2010 because of rain, cane planted last year and re-growth crops harvested over several seasons. Borgna, who estimated the cyclone may have cut his potential output by more than 20 percent, said he was reluctant to lock in prices for more of his cane by forward-selling.

Standover cane was “a mess,” some of the crop may reach half the height it should and root systems were damaged, he said.

“For this year I am about 40 percent priced,” he said, and he was cautious about pricing more because he didn’t know what crop he was going to get.

[Ryan Ruck]

Wisconsin Governor Walker Says He Will Call In National Guard If State Employees Balk At His Proposal

February 11, 2011

Wisconsin Gov. Scott Walker made the dramatic announcement this morning that he is prepared to call in the Wisconsin National Guard to respond if there is any unrest among state employees in the wake of his announcement that he wants to revoke nearly all of their collective bargaining rights.

Walker said he has not called the National Guard into action, but he has briefed them and other state agencies in preparation of any labor problems.

Walker’s plan to resolve the state’s budget deficit would require higher pension and health insurance contributions by state employees and remove bargaining rights except in a limited way over wages.

Critics said Walker’s “attacks” on the union workers violated a long-held state tradition of honest collective bargaining, and his threat to call the National Guard was an unnecessary insult to the state employees.

“Although this stunningly radical move is being cloaked as a budget necessity, it is a cruel hoax because Governor Walker and the Legislature have full authority to balance the state budget without attacking the fundamental rights of workers,” said Robert Kraig, executive director of Citizen Action of Wisconsin. “In reality this is a naked power grab by the large corporate interests that back Scott Walker and who seek unfettered control over Wisconsin politics.”

Walker said the budget repair bill he introduced today and the budget he will unveil Feb. 22 will not include furloughs for state employees and will "essentially not include layoffs."

"The last thing we need is any more people on unemployment," Walker said during a news conference to release details of the repair bill.

Walker said his proposals to reform the wage and benefit process are aimed at bringing stability to state and local government and will stave off thousands of layoffs at the state and local levels.

Good on Gov. Walker.

However, this is what you can expect when the government tit starts drying up and those sucking on that tit don't get their fill...

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Some foods are about to become luxury items


Glenn Beck-02/15/11-A



Glenn Beck-02/15/11-B




Glenn Beck-02/15/11-C

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Food prices skyrocketing; Customers feeling the pinch

Michael Gorsegner
Staff reporter
8:14 AM EST, February 16, 2011

YORK —

That trip to the grocery store might cost a bit more as food prices are on the rise. Those prices are 30 percent higher then just a year ago.

The World Bank estimates that food prices have risen 15 percent since just October and nearly 30 percent since January of 2010. That means every time you go to add something to your refrigerator, it's going to cost you more.

"This is the highest I've ever seen it," said Arthur Webb of Crest Foods.

Those are not the words you want to hear from a grocery store manager. But that's the growing concern across the world as food prices continue to rise.

"I walked over and noticed it was a dollar more expensive than last time," said shopper Ashley Taylor.

Produce prices are one of the many things going up on the grocery store shelves. Things like peppers, onions, lettuce and tomatoes, doubling and sometimes tripling in price. Those hikes are being blamed on sub-freezing temperatures in Mexico, a major source of winter vegetables. That freeze is following some damaging weather in December to other crops in Florida and Texas.

"Tomatoes for instance, a week ago were at 99 cents a pound and now we're $1.99. It doubled in price," said Michael Powers of Ben E. Keith Foods.

"We like to be healthy, so I still want to buy produce. But it stinks the prices are so high," said Taylor.

But produce isn't the only thing spiking in price. The cost of wheat doubling worldwide since June while corn has risen nearly 75 percent. And unfortunately, surging grain prices puts a pinch on everything.

Besides being in many foods, grains are used to feed cattle, making the price of beef and dairy more expensive. The end result is some shoppers shying away from what they really need.

"You do without a lot of times, without what you really want and need to eat," said shopper Kathryn Rigsby.

There is some good news. The higher prices is causing demand to go down and that could mean a lowering of prices. Some experts believe we could see an end to the higher produce prices, but not until late March or early April.

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Wisconsin Governor Walker Says He Will Call In National Guard If State Employees Balk At His Proposal

Good on Gov. Walker.

However, this is what you can expect when the government tit starts drying up and those sucking on that tit don't get their fill...

It will start with the world calling for 'peace, peace. Then there will be an internal revolution in America, started by the Communists. From the middle of the country, some of the people will start fighting against the government. The government will be busy with internal problems. Then from the oceans...

[Ryan Ruck]

If Gov. Walker needs National Guardsmen, the Ohio National Guard are pretty good at dealing with protests.

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WISCONSIN SCHOOL SHUTTING DOWN AS TEACHERS STAGE "SICK OUT"

Feb. 16, 2011 10:52 p.m. | Madison public schools and at least five other school districts in Dane County are closing Thursday in anticipation of teacher walkouts or absences related to the Legislature taking up a bill that reduces public employee bargaining rights and benefits.

Class cancelations announced on district websites include DeForest, Oregon, Verona and Waunakee.

Classes in the Madison Metropolitan School District, along with the Monona Grove and DeForest Area school districts, also will close, according to WISC-TV in Madison (Channel 3000) website.

Mary Bell, president of the Wisconsin Education Association Council, urged teachers and other state residents to come to Madison on Thursday and Friday. She stopped short of asking teachers to walk off their jobs.

WEAC's effort came as Madison schools closed Wednesday because more than 40% of teachers called in sick so they could lobby legislators.

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Mexico loses 80-100% of crops to freeze, US prices to skyrocket

Feb 11, 2011 by ■ Lynn Herrmann - 20 comments



Houston - The cold weather experienced across much of the US in early February made its way deep into Mexico and early reports estimate 80-100 percent crop losses which are having an immediate impact on prices at US grocery stores with more volatility to come.

Wholesale food suppliers have already sent notices to supermarket retailers describing the produce losses in Mexico and the impact shoppers can expect. Sysco sent out a release(pdf) this week stating the early February freeze reached as far south as Los Mochis and south of Culiacan, both located in the state of Sinaloa, along the Gulf of California. The freezing temperatures were the worst the region has seen since 1957. According to Sysco’s notice sent out this week:

“The early reports are still coming in but most are showing losses of crops in the range of 80 to 100%. Even shade house product was hit by the extremely cold temps. It will take 7-10 days to have a clearer picture from growers and field supervisors, but these growing regions haven’t had cold like this in over half a century.”

At this time of year, Mexico is a major supplier to the US and Canada for green beans, cucumbers, squash, eggplant, asparagus, peppers and round and Roma tomatoes. Compounding the problem is the freezing cold that hit Florida in December and January. Sysco continued with its dire report:

“Florida normally is a major supplier for these items as well but they have already been struck with severe freeze damage in December and January and up until now have had to purchase product out of Mexico to fill their commitments, that is no longer an option.”

Validating that statement, The Packer released a statement at the end of December stating:

“Freeze damage to Florida crops could increase demand for Mexican vegetables for the rest of winter, grower-shippers say.”

That December report noted Florida’s cold temperatures and crop loss but was optimistic over Mexico’s produce, even if prices were climbing. “My gut feeling tells me the Mexican deal is going to be very active,” said Ken Maples, sales manager for Plantation Produce in Mission, Texas, according to The Packer. “Green beans in Florida were seriously hurt. Romas that are $10 or $10.95 today in 25-pound bulk, I look for it to be in the mid-teens,” Maples added. But that was December. On Wednesday, The Packer reported that:

“Supplies of tomatoes, peppers, cucumbers and other vegetables from Mexico will be severely limited until at least March following an early February freeze.”

Wholesale prices for many crops have already begun climbing, doubling and almost tripling what they were at the beginning of February. The Packer notes that the short-term, mid-term and long-term outlook for some crops is “devastating” and using this week’s pricing as a gauge of what is in store for consumers noted:

“On Feb. 8, the U.S. Department of Agriculture reported prices of $22.95-24.95 for two-layer cartons of 4x4, 5x5 and 5x6 vine-ripe field-grown tomatoes from Mexico, up from $6.95-9.95 the week before and $5.95-7.95 the year before.”

Jerry Wagner, sales and marketing director for Farmer’s Best, based in Nogales, AZ, said: “The end of February and the first half of March, there will be even worse shortages of product” than during the first part of February, The Packer reports. Wagner called it “a miracle” if 20 percent of the cucumber crop survives. Yellow, green and grey squash took the biggest hit. “Some plants will come back but the vast majority is lost,” Wagner added. Sysco called the Mexico freeze an “unprecedented disaster” and noted the volatility of the matter in its release:

“With the series of weather disasters that has occurred in both of these major growing areas we will experience immediate volatile prices, expected limited availability, and mediocre quality at best.”

Mike Alton, marketing director for Prime Time International LLC based in Coachella, CA said: “We’re in for a long, tough haul,” according to The Packer.

[American Patriot]

Got cold down there. That damnable Global Warming! Maybe it killed the weed crops too.