Here's one of the reasons why everybody should consider growing a garden ~ even a small indoor one ~ we've got one whopper of a world busting drought coming this year. Makes 1930/35 look mild. It's more on the order of the things many of our ancestors faced in the 1800s!
There's a February 15, 2009 brief on the implications of this drought pattern at: http://images.google.com/imgres?imgurl=http://www.infiniteunknown.net/wp-content/uploads/2009/02/countries_by_agricultural_output1.png&imgrefurl=http://www.infiniteunknown.net/tag/kenya/&usg=__QaVour7cLGEU2Z-kewsqWSDJl_U=&h=286&w=550&sz=83&hl=en&start=68&um=1&tbnid=iAvJalXdIiM3nM:&tbnh=69&tbnw=133&prev=/images%3Fq%3Ddrought%2Bconditions%2Bmexico%26ndsp%3D18%26hl%3Den%26sa%3DN%26start%3D54%26um%3D1<P>
http://www.marketoracle.co.uk/images/2009/Feb/Countries_by_agricultural_output%5B1%5D-747806.gif
Interesting site; the maps are quite impressive but still remain projections on the weather and the upcoming climate.
As such, one should be cautious in making judgments of their full value.
If you read to the bottom of the piece you will run into the meat of his argument as all that proceeds it is merely priming the pump for his delivery:
“The deflation debate should end now
The droughts plaguing the world’s biggest agricultural regions should end the debate about deflation in 2009. The demand for agricultural commodities is relatively immune to developments in the business cycles (at least compared to that of energy or base metals), and, with a 20 to 40 percent decline in world production, already rising food prices are headed significantly higher.
In fact, agricultural commodities NEED to head higher and soon, to prevent even greater food shortages and famine. The price of wheat, corn, soybeans, etc must rise to a level which encourages the planting of every available acre with the best possible fertilizers. Otherwise, if food prices stay at their current levels, production will continue to fall, sentencing millions more to starvation.
Competitive currency appreciation
Some observers are anticipating “competitive currency devaluations” in addition to deflation for 2009 (nations devalue their currencies to help their export sector). The coming global food shortage makes this highly unlikely. Depreciating their currency in the current environment will produce the unwanted consequence of boosting exports-of food. Even with export restrictions like those in China, currency depreciation would cause the outflow of significant quantities of grain via the black market.
Instead of “competitive currency devaluations”, spiking food prices will likely cause competitive currency appreciation in 2009. Foreign exchange reserves exist for just this type of emergency. Central banks around the world will lower domestic food prices by either directly selling off their reserves to appreciate their currencies or by using them to purchase grain on the world market.
Appreciating a currency is the fastest way to control food inflation. A more valuable currency allows a nation to monopolize more global resources (ie: the overvalued dollar allows the US to consume 25% of the world’s oil despite having only 4% of the world’s population). If China were to selloff its US reserves, its enormous population would start sucking up the world’s food supply like the US has been doing with oil.
On the flip side, when a nation appreciates its currency and starts consuming more of the world’s resources, it leaves less for everyone else. So when china appreciates the yuan, food shortages worldwide will increase and prices everywhere else will jump upwards. As there is nothing that breeds social unrest like soaring food prices, nations around the world, from Russia, to the EU, to Saudi Arabia, to India, will sell off their foreign reserves to appreciate their currencies and reduce the cost of food imports. In response to this, China will sell even more of its reserves and so on. That is competitive currency appreciation.
When faced with competitive currency appreciation, you do NOT want to be the world’s reserve currency. The dollar is likely to do very poorly as central banks liquidate trillions in US holdings to buy food and appreciate their currencies.
Monday, February 9, 2009
by Eric deCarbonnel
Source: Market Sceptics”
muawiyah,
I am pinging others on this ping. I am no climatologist (sp), and don’t claim to be one.
However, I have interviewed many fisheries biologists, and learned a lot about crappie population crashes experienced here many years ago, when the native white nosed crappie pops crashed and the state WL agency began the black nosed crappie stockings.
I remember all of them telling me droughts run in seven year cycles. I know we (Tennessee and many southern states) are at least two years into this cycle. It may be more, since I moved to my present location three years ago and began getting serious about my garden two summers ago.
I have been thinking about this recently, while planning my 2009 veggie garden. I have a sprinkler system planned, and to back it up I am catching rainwater (from gutters) and keeping them in gallon milk jugs, with seals (keeps out mosquitos) like a freeper suggested last summer on the gardening thread.
Like I said, I am not an expert on anything, but I did take to heart what the biologists told me about the drought cycles and the idea of catching rainwater when it is available.
