The Remnant Online
News => Signs of the Times => Topic started by: JimB on December 15, 2010, 07:30:21 AM
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Some may not like the source of this article but I think it's worthy of reading
The world experienced a major food crisis in 2008 that led to civil and political unrest from Bangladesh to Haiti and added millions more to those suffering from malnutrition. Though prices have dropped somewhat, some analysts say the crisis never totally ended. With prices rising dramatically in 2010, the world could be on the brink of a new crisis.
While food prices remain below their 2008 highs, "they're a lot higher than they were before 'the food crisis of 2008' took hold," says financial journalist Addison Wiggin (Forbes), noting that wheat, corn, and sugar prices are up more than 50 percent since the beginning of the year. Farm commodity expert Don Coxe argues the first major crop failure in 2011 is all that's needed to "have a full-blown food crisis," one potentially worse than 2008.
Full Article Here (http://www.cfr.org/publication/23495/new_food_crisis_looms.html)
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Here is an interesting statement from the article.....
"A key lesson of 2008 is that volatile global financial markets can result in food commodity price speculation that has dire consequences for the world's poorest," notes CFR's Laurie Garrett. But others say that it was export restrictions, panic buying, and hoarding (JakartaPost) that precipitated the 2008 crisis.
I find this interesting because there are some out there that believe that speculation on oil is what has caused our gas prices to rise like they have.
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There are problems coming, that is for sure. The Bible predicts it.
Higher commodity prices are here for a number of reasons. The US dollar is the currency of the world. Maybe not for long, but it is now. Oil prices are in dollars, not pounds. When a country is not on the gold standard, then what is backing their money? Their good name. So, the US has been the great economic power in the world for many years. But, when the government begins printing money without prudence, then what happens to the dollar? Well....if yesterday there were three trillion dollars in circulation and today that doubled, what would happen to prices? When large sums of money are printed, then the value of the dollar goes down. It takes more money to buy the same thing. This is one reason why oil prices are going up.
But, as is being pointed out, there are some who find that speculating on commodity prices can bring large profits very quickly. This can also end up a disaster for investors if things don't go as planned. When the US government has not been good about paying its bills, there are many today betting on inflation because of the huge increase in the money supply and borrowing. I think they have a point. But, if the economy continues to get worse, then maybe there won't be inflation and prices will begin to drop again. Or, maybe if the government keeps spending we will have high unemployment and inflation. It seems like a very real threat.