Thursday, November 30, 2006
Micheal Crichton has just released a new book - Next - that does for biotechnology what State of Fear did for global warming. And to hype the book (which this post lamely aids), he has a "pseudo-website". See it here.
The guy can write, although his recent books are obvious screenplays - not novels. But he plays fast and loose with facts. It will be interesting to see those who hailed him as a hero in the global warming debate but who will be horrified to see him send up biotech now.
Reviews here, here, and here. I may read it soon, if I get it for Christmas.
While most of us in agriculture have been focused on commodity prices (well, our specific commodity price) other prices have been gyrating as well. For instance the price of a dollar.
And so it has. Against the euro, the dollar had been dropping, little by little, for more than a month before it broke through $1.30 on November 24th, going on to hit a 20-month low (see chart). Against the pound, on November 28th the greenback was at its weakest for two years. It slipped against the yen too, though it later made up the ground. Against the yuan—politically the most sensitive exchange rate these days—it continued a stately decline. [More]Bad as it is to be playing second fiddle to a made-up currency like the euro, the steady rise of the yuan is the more interesting. We have been hounding China to let their currency appreciate, and now we've essentially done it for them with our slowing economy. Should the trend continue, money flows would change to counteract the effect.
Whether or not the greenback's decline persists, savvy investors can find plenty of ways to hedge against currency risk. The key is to maintain a globally well-diversified portfolio, experts say. Though the dollar may be falling, the sky is not. [More]Back in the good ol' days, we'd just trot Big Al up to Capitol Hill to unleash a stream of cryptic quotes that the world would take for wisdom and faith in the greenback would miraculously reappear. Not so the with the new guy.
In the past few months, every time a policy maker found a waiting platform, he or she used the opportunity to remind us that the Fed is more concerned about rising inflation than slowing growth.
Their words had predictable results. The prices of interest- rate futures contracts that reflect expectations of Fed policy sank, wiping out the gains registered on weak economic data.
The gyrations have been large. The June Eurodollar futures contract rallied 43 basis points from 94.72 on Sept. 18 to 95.15 on Oct. 4. The gains were completely reversed over the next three weeks as various Fed officials -- Fed Governor Don Kohn and District Bank Presidents Michael Moskow (Chicago), Charles Plosser (Philadelphia), Richard Fisher (Dallas) and Jeffrey Lacker (Richmond) -- reiterated their concerns about inflation accelerating or failing to retreat from its current unacceptably high levels.
Then something strange happened. The market stopped listening.
But do we really care down on the farm if the dollar is weak? It depends on whose import is being gored. If you want to export grain or meat, you usually cheer as the dollar makes your products cheaper compared to competitors. But when you turn around to buy something with those cheaper dollars it gets problematic.
And one big thing we buy is energy. Oil, natural gas, and other imports cost more and this contributes to inflation. In fact, how much you buy and sell outside the country will determine which side you are rooting for. The tricky bit is if oil exporters decide to price in something other than dollars - like those pesky euros.
This would have a profound impact on our economy and our ability to control it within our own borders. As it is a falling dollar may force the Fed to raise rates even as the economy slows further. (It's really hard to tell cause from effect in this exercise, by the way).
We may be winning the corn price battle and losing the economic war.
Update (12/1) - Fortune magazine, presumably having read my post, agrees.
Jeez - you couldn't write a suspense novel any weirder than this. A former (?) Russian spy Alexander Litvinenko was apparently poisoned with polonium-210. And now its showing up on British planes.
The case of the poisoned former KGB agent took a bizarre twist when British Airways said that traces of radiation had been detected Wednesday on jets that flew between London and Moscow, establishing a possible Russian link and indicating that more than 30,000 people may have been exposed to radiation.
The airline said tests found "very low traces" of radioactivity on one of three Boeing 767s that flew between London and Moscow days before Alexander Litvinenko fell ill from the radioactive poison that doctors say killed him. [More]
And everything you need to know about polonium.
The important detail is the part about being an alpha-emitter. Alpha particles are very large and consequently bump into other nuclei easily, so a sheet of paper can stop them. However, if an alpha-emitter is lodged in your lung or other internal organs, it will definitely be close enough to sensitive tissue to cause damage. This is also the problem with plutonium as well. But it needs to be inside you - not around you.
Polonium-210 is an alpha emitter that has a half-life of 138.376 days. A milligram of 210Po emits as many alpha particles as 5 grams of radium. A great deal of energy is released by its decay with half a gram quickly reaching a temperature above 750 K. A few curies (1 curie equals 37 gigabecquerels) of 210Po emit a blue glow which is caused by excitation of surrounding air. A single gram of 210Po generates 140 watts of power. Because it emits many alpha particles, which are stopped within a very short distance in dense media and release their energy, 210Po has been used as a lightweight heat source to power thermoelectric cells in artificial satellites. A 210Po heat source was also used in each of the Lunokhod rovers deployed on the surface of the Moon, to keep their internal components warm during the lunar nights. Some anti-static brushes contain up to 500 microcuries of 210Po as a source of charged particles for neutralizing static electricity in materials like photographic film. The majority of the time 210Po decays only by emission of an alpha particle, not by emission of an alpha particle and a gamma ray. About one in a 100000 decays results in the emission of a gamma ray, this low gamma ray production rate makes it more difficult to find and identify this isotope. Rather than gamma ray spectroscopy, alpha spectroscopy will be the best method of measuring this isotope.
So don't worry about dying from radiation planted by Russian spymasters. Worry about them controlling the market for natural gas.
I'm just here to help.
Wednesday, November 29, 2006
(Admit it - the title hooked you) So anyway, there were these horses in the Netherlands who got caught in a storm and were stranded on an island by rising waters, and then these Dutch girls on horses...
Oh, see for yourself.
While I am widely know as horse-indifferent, I did like the music. Like most of Europe, I was surprised when the camera zoomed out and the "island" turned out to be a small rise in a pasture about 200 yards from higher ground.
Perhaps just a little overwrought.
But is does bring up an interesting thought. The Dutch are now the tallest people on the planet. What if that is an evolutionary outcome from living in the "lowlands". I mean, the short ones would would drown as the water rises, right?
Tuesday, November 28, 2006
The unnaturally warm weather this week has prompted me to haul out the tractors again and apply some fall NH3. My local fertilizer salesman asked me yesterday what I had heard NH3 prices were going to do this winter. While it's nice to be thought of as somebody who "knows stuff", I rarely get that benefit of the doubt around home.
And for good reason.
Anyway, the folks at the University of Illinois have an excellent piece on this very topic:
The story of the nitrogen you require for corn begins with natural gas, and its price is related to oil, as well as politics and a fragile production infrastructure. Ammonia, which is the primary source of nitrogen, is produced from natural gas, and because of a wide variation in the cost of natural gas around the world, ammonia prices will also vary widely. In the US, agricultural ammonia consumes only a sliver of the natural gas produced, and has to compete with many other industries. Since natural gas futures are traded, it is possible to watch futures prices and predict the cost of ammonia compared to prior seasons.But as usual for Extension people, they use circumspect language and vague conclusions not unlike a political press secretary. I certainly understand their caution.
I have fewer constraints. Anhydrous ammonia, in my opinion is about to teach farmers a lesson in pricing power. While we can calculate the relationship between natural gas and NH3, and create linkages between the prices, I don't think that's going to be the market driver.
Ethanol is - via huge amounts of corn acres needing N. Couple that with relatively few fertilizer producers and retailers, and you have a perfect chance to price what the market will bear.
And with $3.50 corn the market will bear a lot. Farmers will have to buy N. We know it and N producers know it. Why on earth would they let Cargill's money dawdle in my checking account when it could be boosting their shareholder's value?
And really, what choice do I have?
So forget about natural gas prices and production costs for NH3. That apparently only works when NG prices are going up. NH3 going to go up until we stop buying it.
Why do you think I fired up my tractor Monday?
Monday, November 27, 2006
Where will all the energy we need in the future come from? Maybe it won't!
So where will the extra energy come from? Relying on figures from the World Energy Assessment by the United Nations Development Program, Nocera looks at the maximum amounts of power that various non-fossil fuel sources might supply. Biomass could supply 7-10 TW of energy, but that is the equivalent of harvesting all current crops solely for energy. Nuclear could produce 8 TW which implies building 8000 new reactors over the 45 years at a rate of one new plant every two days. Wind would generate 2.1 TW if every site on the globe with class 3 winds or greater were occupied with windmills. Winds at a class 3 site blow at 11.5 miles per hour at 33 feet above the ground. And hydro-power could produce 0.7-2 TW if dams were placed on every untapped river on the earth. Nocera concludes, "The message is clear. The additional energy we need in 2050 over the current 13.5 TW base, is simply not attainable from long discussed sources—the global appetite for energy is simply too great." [More]Sooner or later, the market will encourage us to lower energy consumption, and my bet is technology to trim energy use will be even hotter than technology to produce energy.
Sunday, November 26, 2006
As we watch, so to speak, the television industry is undergoing wrenching change. Since it is driven by advertising dollars, the new competition from the Internet was the first agent of change.
But the true upheaval may arrive in the form of home-made content like YouTube. Certainly Google thinks so as it shelled out $1.8B for the barely year-old company a few weeks ago. This is changing not only the way we watch video, but what we want to watch.
Lots of people can now watch themselves on sort-of TV, which is pretty fun in itself. The bonus is that others want to watch them, too. Third-millennium humanity has demonstrated an interest in sifting through millions of pieces of crap produced by total strangers to discover a few gems – some accidentally entertaining ("Boom Goes the Dynamite"), some breakout performances from the previously obscure ("Treadmill Dance"), and some explorations of a new art form crackling with genius (Ze Frank, Ask a Ninja, and the guys behind Loneygirl15.)
Throw in the uploaded TV commercials, such as Nike's Ronaldinho spot showing the Brazilian soccer star miraculously volleying against the crossbar. Add to that some professional content either stolen from or surrendered by Hollywood. Altogether, this stuff constitutes a bottomless reservoir of short-form video content for others to siphon off if they choose. Which they do, millions of times a day, from pages all over the Internet. That's the demand side of the equation – monkey see, monkey use – foreshadowing the future of media, already in progress.
Forget "exploding TV." The name for this thing is Monkeyvision. [More - and be sure to watch the clip of the young sports announcer]
Is this just another advertising wrong turn that will fade as the public moves on to the next hot idea and settles back to watch the NFL again? With every day, fewer observers think so.
TV advertising has been losing its impact for years: McKinsey projects that by 2010 it will be barely one-third as effective as it was in 1990, thanks to rising costs, falling viewership, ever-proliferating ad clutter, and viewers' TiVo-fueled power to zip through commercials. Big national advertisers like General Motors, which has an annual TV ad budget of $2.9 billion – only Procter & Gamble's is bigger – are demanding something different, and the rise of Web video offers just that. Internet advertising of any sort promises powers that marketers have long lusted after: the ability to target people who might actually be interested in what they're selling and to engage those people in conversation. Web video can be as emotionally involving as TV, and when used in consumer-generated campaigns, as crowdsourcing efforts like Chevy's have come to be known, online clips come with a bonus – people see them less as advertising than as peer recommendation, which countless studies have shown to be far more influential. [More]
All of these possibilities are predicated by the widespread availability of broadband. While I am not big on government mandates, we in rural America should at least ask our representatives when and whether we will be allowed to come to this party. A change this big in or communications infrastructure will impact our lives as much if not more than urban America. (Find out what broadband choices you might have here)
Right now it is no large loss, but if the vast majority of Americans begin to choose Internet delivery of video or the two media blend into one, as some cable companies are trying, one more disadvantage to living in rural America will be added to our struggling little towns and isolated rural residents.
Not to mention our increasingly few farms.
Saturday, November 25, 2006
Just when the food-or-fuel discussion is heating up, the relentless march of agricultural technology continues. To begin with, we will certainly be able to increase yields if the market encourages us just a little.
The Missouri Soybean Association plans to announce Kip Cullers of Purdy, in southwest Missouri, as the new record-holder and winner of its 2006 Yield Contest today. The new record of 139 bushels per acre — 21 bushels more than the previous world record set in Michigan — came as a shock to Wiebold and his colleagues.Meanwhile we are still working to make the crops we grow more nutritious - and not just with "Evil" Genetic Modification.
Adding this gene back into the conventional wheat supply could help remedy the zinc and iron deficit suffered by more than two billion people worldwide, according to World Health Organization statistics. And more than 160 million children lack adequate protein in their diet, which this enhanced wheat could supply. "If you do not have anything else available to eat, it would be good to have wheat that provides more protein and micronutrients," Dubcovsky says. "We are also working on a new mutant that will eliminate an antinutrient present in wheat--phytic acid--which reduces the bioavailability of the zinc and iron present in the grain." [More]We are even turning things we can't eat into an acceptable food source.
Researchers have genetically engineered cotton plants that produce toxin-free seeds, potentially unlocking enough nutritional content to feed half a billion people worldwide each year.Mind you, I don't think cotton seed meal is going to threaten donuts as a popular food, but at least poorer countries can start getting food and fiber from the same crop.
Cotton is grown in more than 80 countries and is a primary source of fibre for textiles, providing an important cash crop to some 20 million farmers in Asia and Africa. But a little-known characteristic of the cotton plant is that for every kilogram of fibre that is produced, it also yields 1.65 kilograms of seed packed with high-quality protein. So cotton plants have the ability to meet the protein requirements of millions with no reduction to the output of cotton fibres. [More]
In short, it may be premature to look at current supplies and accurately estimate future farm output. I don't think we have any idea what kinds of crops and yields we can produce, nor do we understand the capacity of our natural resources. The fact scientists all over the world, in partnership with every type and size producer have a consistent track record of larger and more efficient production suggests we will continue this quiet improvement for years to come.
Simply because we don't know how it will happen, does not make believing it will happen foolish.
Actually, it has proven to be an effective marketing axiom.
Thursday, November 23, 2006
Life is not good for car salespeople. The availability of price information on the Internet - such as Edmunds.com - has eroded margins for dealers and commissions for sales staff.
The car salesman became one of the most derided of American archetypes--and provided rich fodder for fiction and film. Think Harry Angstrom, the adulterous Toyota-selling protagonist of John Updike's Rabbit books. Or Jerry Lundegaard, the slimy Oldsmobile dealer played by William H. Macy in Fargo, who in one scene sneaks in a weatherproof sealant to jack up the price.(Read the comments at the bottom of this article). Despite whether you agree with the salesmen of the customers the crucial point is more fundamental: car sales were built around a business plan that capitalized on asymmetrical information. Or put more bluntly, clueless customers.
Now consumers are getting their revenge. By spending half an hour on sites like Edmunds.com, buyers can find how much the dealer paid for the car, the cost of options, what consumers are paying in a specific region, and which models are available at various dealerships. Many consumers start negotiations citing the invoice price--what the dealer paid--and offer a few hundred bucks over that. [More]
We are seeing this pattern repeated famously for travel agents, stockbrokers, and other commission workers. While these jobs arguably do deliver some value, much of it was in the form of convenience, not expertise. Consequently, only those who don't mind paying for convenience like high-end buyers will not begrudge the added cost of a salesman.
Agriculture may not escape this trend. Imagine an "Edmunds.com-equivalent" for farm machinery. Regardless whether this comes to pass, the machinery industry suspects they have too many dealers.
Contrary to my projections, machinery companies are not optimistic about 2007.
But many analysts said Deere was being too cautious in its outlook. Ann Duignan, an analyst at Bear Stearns, said in a note to investors that "worldwide farm-economic conditions remain quite promising."
"Prices for farm commodities have surged in recent weeks and worldwide carry-over stocks for wheat and corn are at 30-year lows in relation to consumption," Duignan wrote.
David Raso, an analyst at Citigroup, agreed.
"Deere is not yet willing to bake in ... recent strength in farmer fundamentals," he wrote in a note to investors. He predicted the company's 2007 forecast, which anticipates a 22 percent drop in net profit, "will prove too conservative." [More]
Personally, I think farmers will be anticipating $3.50 corn profits and trading up to bigger and better starting yesterday. Those who remember the early '70's can testify to this.
The profit windfall will last until we bid up inputs (like machines and rent) to levels that leave us with about the same net per acre as before. It is in this 2-4 year lag time that aggressive expanders will rewarded, and be prepared for the inevitable contraction with a larger operation to spread costs.
But for the meantime, maybe some of those disgruntled car salesmen will show up in tractor showrooms.
I hope yours is a wonderful Thanksgiving. We have family here and my goodness - what a beautiful day! Perfect for stringing up the Christmas lights, and walking off turkey. And sharing family memories.
But then I read about an outbreak of whooping cough in a Chicago school and it triggered some awful memories. My oldest sister got whooping cough (pertussis) in high school and her struggle remains a terrifying part of my childhood. The "whoop" that gives the name is a noise created by a desperate attempt to get air after coughing uncontrollably.
This follows a similar outbreak of mumps in the same general area.
America has decided to depend on artificial immunity to prevent childhood fatalities. But the decision is not quite as simple as that. I wouldn't want anyone to have to go through what my sister did, but is seems to me the effort to eliminate all childhood diseases has left many of our children with less than robust immune systems.
Regardless now there is less choice. Get and keep current your family's vaccinations. Especially your college-age children. Things seem to be transmitted really fast among that age group.
Gaining natural immunity involves considerable risk. Diseases that otherwise are vaccine-preventable can kill or cause permanent disability, such as paralysis from polio, deafness from meningitis, liver damage from hepatitis B, or brain damage (encephalitis) from measles. Immunity from a vaccine offers protection similar to that acquired by natural infection. At the same time, vaccines rarely put individuals at risk of the serious complications of infection.
Some people believe that many of those affected during a disease outbreak are in fact the ones who were previously vaccinated. And they argue that immunity from vaccines isn't effective. It's true that vaccines aren't 100 percent protective. Most childhood vaccines are effective for 85 percent to 95 percent of recipients. During a disease outbreak, a number of vaccinated people will indeed catch the disease. However, those who were immunized usually have a less serious illness, while those not vaccinated are in the greatest danger. [More]
Wednesday, November 22, 2006
Perhaps the best news from the recent exercise of democracy in the US was the return to divided government. Steve Chapman in the Chicago Tribune hails the day:
Despite its traditional principles, the GOP's monopoly in Washington has merely freed Republicans to indulge the empire-building, power-lusting, overspending, control-freaking elements that all politicians harbor deep in their souls. Government outlays have swelled, government intrusions have expanded, and the only reason the 82nd Airborne no longer escorts kids to kindergarten is that the job has gotten too dangerous. [More]For those of us in agriculture, this is great news [if you are not fond of subsidies]. Republican deficit hawks now are free to obstruct passage of budget busting spending without calls to support the GOP. And President Bush, anxious to improve his questionable legacy has no reason to sign spending-spree legislation. In fact, to reclaim the fiscal conservatives so they can be re-used in the next election cycle, he could even be more hard-line on spending.
Except for defense, of course. And tax cuts. And medicines. And ...
There is something going on with the comments section of this blog. Once you post a comment it is recorded but sometimes doesn't show on the "comments count" of the post until I republish the blog with a new post.
I'm working on it.
Been gone on a business trip for s few days, but should be catching up today...
Thanks for reading and Happy Thanksgiving!
Monday, November 20, 2006
The GR8 TaT2 Maker is a toy tattoo gun for your little budding skin-artist: "Open up your very own pretend play tattoo parlor. This easy-to-use tattoo maker kit includes an electronic tattoo pen and funky stencils. Using soft, safe pulsating action, the tattoo pen creates realistic, washable designs with dramatic effects.
It all starts with a pool table...
While we corn growers are all gurgling with joy over the ethanol market, some of our best and most loyal customers are under considerable duress.
A 77 percent jump in the past year has made corn the most expensive since 1996, squeezing profit at Coca-Cola Enterprises Inc. and Tyson Foods Inc. Speculators including Pacific Investment Management Co. are basking in returns that go beyond forecasts made as recently as July.Part of the reason is the furor over immigration. It will be interesting to see if the new Congress and Pres. Bush reach an understanding on how to handle the illegal immigrants already fueling much our resilient economy.
A similar story ran in the LA Times back in July, about Arkadelphia, Arkansas. It was another tale of chicken processing plants, sudden immigration raids, over a hundred workers dragged away, and subsequent damage to the emotional and economic life of a city. The federal raiders got no cooperation, as the story tells it, from local prosecutors or sheriffs, who understand the local circumstances that make such raids a stupid waste of time that doesn't serve their communities, but disrupts them. Arkansas' Republican Gov. Huckabee even donated a grand to a relief fund set up for families hurt by the raid. [More]Between these two forces, I think much of our domestic livestock industry is up for grabs as we grain producers forsake them to become the ethanol sheiks. When Brazil is the place the world goes for chicken and pork instead of the US, we may wonder how we could have allowed this to happen.
Brazil’s world share of exports is expected to drop by one point to 38 percent. Brazil, which has shown annual increases in broiler meat exports over the last six years, is forecast to show a decrease in 2006 exports due mostly to weakening demand in a few of its major export markets. This is a result of economic factors within the country and AI concerns in importing countries. These AI concerns have led consumers to substitute other protein sources for poultry meat. These circumstances have led to an over supply issue in Brazil. With AI concerns expected to decline and as Brazil focuses on using more aggressive marketing strategies on its larger poultry importers, broiler meat exports are expected to rise 2 percent in 2007 to a total of nearly 2.6 million tons. [More]If avian influenza (AI) or bird flu remains a dormant threat, Brazil is poised to be formidable competition to US poultry giants. This will eventually impact our corn market.
And our food prices.
It may just be me, but it seems the more evidence we accumulate to substantiate anthropogenic global warming, the less we seem to care. Certainly the recent African summit evinced few signs of panic or even interest, especially by the major players.
THE United Nations conference on climate change, which closed on Friday in Nairobi, was distinguished mainly by its ineffectualness. Like many such events it had proclaimed a grand ambition: to design a more effective régime to replace the Kyoto protocol after 2012. But for all the posturing in the plenary sessions, there was no sign of urgency or radicalism in the corridors. [More]It is almost as if winning the academic battle was THE battle. This peculiar point of view mirrors many political squabbles as well. If we can get our opponent to admit he/she is wrong, then we win - despite the fact the problem still remains.
So we spend our time parsing with a microscope press conferences and newspaper accounts for flaws and openings, but little actual effort is spent in corrective action.
Saturday, November 18, 2006
Friday, November 17, 2006
While much of the country was well and truly gerrymandered during the last decade, those sensible Iowans managed to get the job with little rancor and even ended up with sensible districts.
Redistricting has become synonymous with political extremism and party warfare. Last year, legislators staged bizarre confrontations in Colorado and Texas over unprecedented attempts to change district lines in mid-decade.
But unlike many other states, in 2001 the
Legislature was able to re-draw its congressional and state legislative districts with little controversy. Iowa
But can we use a computer to do the work?
Whether or not computerized redistricting would make for good government, it offers some interesting exercises in mathematics and computer science. Algorithms for redistricting exploit techniques from computational geometry, graph theory, combinatorics and optimization methods. Even if such algorithms are never embodied in law, perhaps they can suggest some ideas that would be useful in a more conventional approach to redistricting.I suppose we'll have to wrench districts around according to the power structure of the moment for a few cycles, but what may finally end gerrymandering is the mobility and fickleness of the American public. Districts don't necessarily stay" safe" for long periods.
I have been learning new things about what we label as sprawl. First, the eye-opening eponymous book by Chicago researcher Richard Bruegmann who pointed out that almost all development occurs because more people want houses - hardly a bad thing. The second point which hit home is that sprawl is cited as a problem by people who have got their house and space already - not those living in 800 sq.ft. apartments.
Now a new study from California researchers adds some interesting perspective on the social qualities of suburbs. Brian Doherty at Reason adds a cogent opinion.
It turns out that people don't necessarily become less neighborly as they move for more room. In fact, it may be just the opposite. It has always been hard for me to figure out why people keep wanting to live in suburbs if they are as bad as critics say.
A friend of mine sent me this questionable e-mail about finding a bear with a combine:
Subject: Combine Bear
This happened down near Decatur/Taylorville,IL. this farming season. Just
thought Id share with ya all.
My neighbor last Friday got this bear with the combine a half mile north
of me. The combine was stuck, and the den hole was 5 feet deep. The bear
was trying to dig out from under the wheel but could not get out, the DNR
told them to shoot it. It dressed out 287 pounds, and was a male.
Troy got a bear with the combine. He was combining our corn over at
Measners field and fell into a big hole. He thought it was a badger hole
until a big black paw came out. Pretty soon a head appeared. They knew
for sure it was no badger. He wasn't very happy either. He was 300
Look, I hate to propagate e-mail hoaxes, but this is a good one if it is.
But a bear in central IL??? BTW, anybody know these guys?
A 300-pound raccoon I could believe.
For my browser at least the number of comments is not displaying accurately. There have been new comments on "I love it already" and "Waste and fraud". The guys at Blogger are aware and working on the problem.
Thanks for your comments.
Thursday, November 16, 2006
Let's see, we're going to fight global warming by hoisting giant guns with balloons into the upper atmosphere where they will fire tons of sulfur to block the sunlight and cool the earth.
The Dutch climatologist, awarded a 1995 Nobel in chemistry for his work uncovering the threat to Earth's atmospheric ozone layer, suggested that balloons bearing heavy guns be used to carry sulfates high aloft and fire them into the stratosphere.
While carbon dioxide keeps heat from escaping Earth, substances such as sulfur dioxide, a common air pollutant, reflect solar radiation, helping cool the planet. [More]
Why didn't I think of that? Reactions have been ummm, mixed.
But wait - it could get even better. First you'll have acid rain falling as the sulfates mix with water to form sulfuric acid - that will be fun. And of course, every now and then a large artillery piece will sorta plummet to earth.
Is this a great planet or what??
In an effort to turn your home into a warm cheerful tavern, try this:
Rebound Shuffleboard Game - $100
Seriously, if you have grownup children returning for the holidays, you need things to do. This might be fun and would give me an excuse to convert a corner of our basement to a pub!
The ongoing strategy to creatively label products to convey some imperceptible quality in order to appeal to consumers is being worked to extremes with food.
Animal welfare is clearly a hot topic in the supermarket these days, as anyone can see just by taking a look at all the different types of labels and certifications that are meant to convince us that the animals we are eating led full, happy lives before they became dinner. The current list includes labels such as "free farmed," "certified humane," "cage free" and "free range," among others. Whole Foods is adding a new term to this group: animal compassionate. [More]Now throw in the grass-fed/organic/free range stickers and the whole system is in danger of becoming perfectly obscure. The underlying reason: the products (meat, vegetables, etc.) are non-differentiable - you cannot take two competing products and test them and say which is which.
This will certainly be the case for the next technological "horror": cloned livestock. Despite the hopes of specialty producers, this fact sooner or later dawns on most buyers.
Not coincidentally, it also occurs to many producers who are tempted to falsify claims, since you essentially take their word for it.
To be sure, if the commerce is also coupled with an experience like a farm visit, or a farmer's market that adds some entertainment or social value, it becomes unique and can command a premium. But if it is simply sitting in a display case, this facade is hard to buy over time.
Certainly Whole Foods is finding the market more challenging than it appeared just a few months ago.
Whole Foods has enjoyed a great run as health-conscious shoppers paid premium prices for its fancy and organic produce. But analysts have warned that a slowdown in con-sumer spending and tougher competition from mainstream grocery stores could squeeze Whole Foods profits.We do not know how large this segment of the food market can become. But it appears that in their desperation to offer food with ethereal, even spiritual qualities they may be drifting off the market radar.
Wednesday, November 15, 2006
No doubt howls of feigned outrage will erupt over recent USDA admissions of fraudulent payments to farmers.
WASHINGTON - The Agriculture Department on Wednesday acknowledged making improper payments to farmers worth more than $2.8 billion last year. [More]We don't do outrage well any more, so it will soon pass. But the point most people will miss is what level of fraud is tolerable. Oh sure, we could all rant on and demand ZERO, but you really wouldn't want a system that was that good, trust me. The administrative costs would spiral out of control. The only way to have zero waste is to have zero payments.
I think the government should be able to handle money only slightly worse than the average citizen. After all that's who works for the government, right? And after spending all day counting up "my profits and my costs", I would have been satisfied with an 11% waste figure this year.
Replanting 200 acres was a waste, so was one herbicide I used and two highly-touted hybrids. I could have saved on fuel as well. And on and on...
My point is we need realistic expectations. Farm payments are found money, so all kinds of schemes will sprout in farmer minds to get more than what they have coming. You know that and I know that and little kids in the schoolyard know that. Moreover, by Iraq or Katrina* standards the USDA is in the minor leagues.
So the next time a politician yelps about government waste, ask him what percentage it should be. If he/she says zero, you'll know he/she is clueless.
(*Strangely about 11% waste again - maybe a law of nature?)
Tuesday, November 14, 2006
Today's grain rally is brought to you by: yours truly.
I sold yesterday, convinced the top was in.
Is it just me or is this market a little screwy?
Maybe not. Note this commentary from Chip Flory - if you read it slowly it starts sounding like Rumsfeld and the "known unknowns and the unknown unknowns"
Free traders traders are setting their sites a little lower. Far from pushing for more liberalization, they are now hoping to simply hold the ground they have gained.
One reason for this global trade gloom has been a defection from their ranks similar to the disgruntled fiscal conservatives from the GOP. William Keegan is one.
The unfortunate insistence on touting overall economic advantage while ignoring the distribution of those benefits has disillusioned many of us into thinking we have been had. What economists often fail to grasp (until their department starts filling with lower-paid professors from abroad), is that dislocation is not an academic exercise nor is it easy to change to recover at the personal level. America's 4% unemployed are 100% unemployed.
Summers, a Democrat, is no protectionist. Nevertheless he has rightly drawn attention to the way the US middle class (both employees and employers) have been hit by globalisation and its concomitant threat of cut throat competition from cheap labour. As has often been noted, globalisation has tended to benefit the very rich, and the very poor (the latter, for instance, in the shape of Chinese workers).
Now, as Summers says "economists rightly emphasise that trade, like other forms of progress, makes everyone richer by enabling them to buy goods at lower prices." But he goes on: "This offers small solace to those who fear their jobs will vanish."
With the changes in Washington, I have no doubt regrettable protectionist sentiments will find new life. But the revival of opposition could make free trade proponents consider how to spread the goodies among more people to win new converts.
Monday, November 13, 2006
In announcing progress for the Iranian nuclear program Mahmoud Ahmadinejad was clad in his now-traditional windbreaker. I have noticed this sartorial statement for months and have thought he was hoping to have it catch on fashion-wise, presumably like Mao jackets.
I'm not the only one who is curious. In an interview with NBC's Brian Williams, the anchorman inexplicably asked about the clothing selection:
Williams: Mr. President, this is not a matter of great concern, this next question, but we have gotten used to seeing you in the tan jacket with the zipper. Today, you are dressed differently. Is that jacket a symbol of your standing or upbringing in Iran?
Ahmadinejad: No. It depends on which one I'm more comfortable wearing. And it of course depends on my colleagues and friends, too. I knew that you were going to wear a suit, so I decided to wear this jacket.
What was that about? While I'm just a small-potatoes blogger, Williams is pretty heavy journalism in a $2000 suit - and he asked the guy who wants to exterminate Israel about his jacket??? "Mr. Stalin, I notice you're wearing pleated pants..."
Or maybe a Cardinals warmup.
Many of us are starting to plan for 2007, even while nursing our marketing/production wounds from 2006. It is pretty exciting stuff looking ahead to $3.50 corn and $6+ beans and $5 wheat.
We are planning on being happy. What could go wrong?
Perhaps we could use a short course in being happy to refresh our skills. This 20-minute lecture by Dan Gilbert at Oxford is worth watching to help build some realistic expectations for our upcoming good times.
Gilbert is a psychology professor at Harvard and author of Stumbling on Happiness. He is part of the growing number of psychologists who are influencing economists to reconsider the effects of economic policy and our habit of relating it to wealth.
Happiness - it's not that hard...
The New York Times, among other papers has a good profile of Jon Tester, the new Democratic Senator-elect from Montana. For those of us who know only the headlines about this race, it offers some helpful background info.
The article is also interesting to me for its format. Note the large number of hotlinks. When a traditional publication like NYT institutionalizes a info-techno change like this it can mark a milestone in communications.
All his life, Mr. Tester, 50, has lived no more than two hours from his farm, an infinity of flat on the windswept expanse of north-central Montana, hard by the Rocky Boy’s Indian Reservation.
For all the talk about the new Democrats swept into office on Tuesday, the senator-elect from Montana truly is your grandfather’s Democrat — a pro-gun, anti-big-business prairie pragmatist whose life is defined by the treeless patch of hard Montana dirt that has been in the family since 1916. [More]
Blog readers have been growing accustomed to hotlinks for years now, but my feeling is more readers will find newspapers one-dimensional in comparison.
Want to check out the source for accurate citing? Just click and read yourself. Want to see more pictures/charts/examples? Follow the link.
This ability to add informational depth may be the big driver behind readership shifting to the Web from newspapers, not flashy screen tricks. Judging from my own experience hotlinks rapidly make reading printed materials seem sparse by comparison.
Sunday, November 12, 2006
Ahoy, all you Natty Bumpo wannabees. No longer do you have to risk your pearly whites to the stray buckshot when eating your manfully-taken prey - you can shoot them with flavor, not lead:
Season Shot is made of tightly packed seasoning bound by a fully biodegradable food product. The seasoning is actually injected into the bird on impact seasoning the meat from the inside out. When the bird is cooked the seasoning pellets melt into the meat spreading the flavor to the entire bird. Forget worrying about shot breaking your teeth and start wondering about which flavor shot to use! [More]The company is also rumored to be working on "gravy shot" as well...
Much economic blither has circulated about the strength of the dollar. But at least it hasn't fallen apart entirely:
Since the first decomposed €20 bill was reported by a state bank in Berlin on June 21, a total of 17 cities have sounded the alarm about disintegrating euros. Authorities in a number of German states as well as the European and German central banks are now investigating. [More]As paper money becomes more awkward in the First World, the problem of plastic is not going away either. You have probably noticed the requirement to show ID when using a card at many retail locations now. In fact, we may see a strong push to merge the two soon.
Still, all things considered cards are much more convenient and so far, my losses to the Bad Guys have been covered by the card issuer.
Rep. Jeff Flake (R-AZ) is a fiscal conservative with a beef. He is also a rising star in the now minority party. Along with Mike Pence (R-IN) and a handful of others they could form a faction that has significant impact on economic legislations and the new GOP leadership. In an op-ed piece in the Wall Street Journal he minces few words about the farm program:
During the 1990s, then-Sen. Phil Gramm accurately described U.S. farm policy as "enough to make a Russian Commissar puke." The Republicans assembled the "Freedom to Farm Act," which, starting in 1996, put U.S. farmers on a glide path toward an end to subsidies. Somewhere between the field and the silo, however, we became mired in the political mud. In 2002, we repealed the Freedom to Farm Act and in its place installed the "Farm Security Act" -- those who value the adage about trading freedom for security can pause and shudder here -- with even more lavish subsidies.
Now, with reauthorization of the Farm Bill on the horizon next year, we have to decide whether we will up the ante with Democrats in terms of red state/blue state politics in the heartland, or whether we believe our own rhetoric about free markets. This debate will have implications larger than the fiscal one. Most notably, it will determine if we are serious about the future of free trade.
Does this mean the ag lobby should be concerned about the outcome of debate over Farm Bill '07? I think not, UNLESS for whatever reason the economy is struggling and interest rates are through the roof.
In short, a lot of farmers could have to choose between gay marriage and LDP's .
Saturday, November 11, 2006
Japan's farmers are among the most protected and subsidized in the world. But even they are feeling immense pressure from global efforts to broaden trade.
One of its members, Takatoshi Ito, of Tokyo University, says the ideas spilling out of the council point to a new stage of change for Japan. The aim is to tie the country more deeply into the global economy by seeking more free-trade agreements (including even with China and America) and boosting pitifully low levels of foreign investment in Japan. A priority is to address Japan's so-called “dual” economy. The competitive exporting industries are not matched in agriculture and services, which are shielded from competition, lack economies of scale and are backward in their use of information technology. To boost investment, the government is mulling a cut in corporate income tax and other tax changes. Deep reforms to pensions and health care are also expected. [More]While this may all seem of quaint interest for American farmers, we have always been able to point across the Pacific and argue, "They're worse than we are!" when threatened with freer trade.
If Japan's farmers have a losing showdown with their vastly more important exporting industries, it will be strong indicator the atmosphere for global trade is capable of forcing US ag policy changes, regardless of the farm lobby.
Friday, November 10, 2006
I have switched to an upgraded version of blogger by Google (who else?) . The main difference will be the labels at the bottom of the posts that will allow rapid searches to find all the posts about "ethanol" for example.
Note: It will take me some time to go back and add labels to older posts, so searches won't be fully effective for a while.
Wednesday, November 08, 2006
- Prop 87 failed in CA: This measure would tax oil companies to fund alternative fuel research like ethanol and was probably a bad piece of legislation. Could this be the turning point for taxpayer support for ethanol?
- Goodbye payment limits: With Rep. Collin Peterson the likely Ag Committee chairman, I think the Treasury doors are now officially open (wider). The only hitch would be if Pres. Bush decided to make up with conservatives by starting to veto excessive spending. No, seriously.
- Prop 204 passed in AZ: The measure would ban gestation crates basically in a state with almost no large hog operations. I dunno, but this type of measure looks repeatable around the US. It's just too hard to defend for such a small political payoff for most elected officials. Wasn't even close.