The American Dream
Jan 14, 2011
People need to wake up – 2011 has just begun and yet we are already seeing significant price shocks and serious food shortages in many areas of the globe. In fact, violent economic riots are now being reported in Algeria, in Chile and in Mozambique. Food shortages and price increases are also causing political unrest in other nations such as India, Bangladesh and Indonesia. This is a very serious situation, and if the major food producing nations of the world do not have another record harvest this year there is very likely going to be an incredibly serious global food crunch. According to the UN’s Food and Agricultural Organization, the global price of food hit a new record high in December. The previous record high for food prices was in June 2008, and we all remember what happened during the summer of 2008. Massive food riots erupted in countries such as Cameroon, Haiti and Egypt. So with price shocks and food shortages already being reported all over the globe, will we see even worse global economic riots in 2011?
One of the things that is playing into all this is all of the really extreme weather that we have been witnessing all over the globe. In Australia, they have been experiencing flooding that is of Biblical proportions. Brazil has also been hit by very serious flooding. In other parts of South America, extremely dry weather is severely damaging many crops. In the Northern Hemisphere, unusually cold and unusually snowy weather has many people scratching their heads. Something really strange seems to be happening to global weather patterns, and that is not good news for global food production.
All of this bad weather is fueling a tremendous amount of commodity speculation. Over this past year, almost every single major agricultural commodity has experienced a dramatic increase in price.
According to Forbes, corn is up 94% since June, soybeans are up 51% since June, and wheat is up 80% since June.
All of these agricultural commodity price increases are really starting to be felt around the globe. Meanwhile, global demand for food only continues to increase.
For the last several years, great harvests in major food producing nations such as the United States have been able to offset the rising demand for food around the globe.
But what is going to happen if the big food exporting nations have a year or two of really bad harvests?
Not only that, but there are a couple of other factors that have many analysts warning of “inflation spikes” in the year ahead….
*Crude oil prices set new multi-year highs on Wednesday and we continue to see a relentless march back toward $100 dollars a barrel. The price of oil affects the price of almost everything else, so this is a key indicator to watch.
*Rampant inflation in China is soon going to impact the prices of literally tens of thousands of different U.S. consumer products. A recent New York Times article stated that U.S. garment buyers should be prepared for “sticker shock” when they attend China’s annual trade shows this year….
“They’re going to go home with 35 percent less product than for the same dollars as last year,” particularly for fur coats and cotton sportswear, said Bennett Model, chief executive of Cassin, a Manhattan-based line of designer clothing. “The consumer will definitely see the price rise.”
So how are U.S. consumers (and consumers all over the globe) going to react when all of those “cheap Chinese imports” are not so cheap anymore?
It won’t be pretty.
But for most people around the world in 2011, the main economic problem is likely to be the price of food. In many areas of the globe, large numbers of people have to spend more than half their incomes just to feed themselves, so a spike in the price of food can have very, very serious consequences.
In some areas of the world, we are already witnessing very violent economic riots in response to rising prices for food.
Just check out what is happening in Algeria. Several protesters have been killed and hundreds of others have been injured during violent food riots in that country. Hordes of young people are throwing fire bombs and are shouting slogans such as “Bring us sugar!” Are these the kinds of food riots that we should expect to see around the globe as food gets tight this year?….
Economic riots are also being reported in Chile and Mozambique. Officials in India, Bangladesh and Indonesia are concerned that political unrest over food prices could soon erupt into violence in those nations as well.
Eric Bolling of the Fox Business Network recently did a really good job of explaining exactly what is causing all of this to happen, and in the video posted below he does not sound very optimistic about the rest of 2011 at all….
A recent article in Forbes magazine summarized the current global food situation this way….
The world is treading on dangerous ground. Market forces are in place for another global food crisis, and, as the wheels keep turning, it will become harder for these to be put in reverse.
So what does all of this mean for America? Could we actually face food shortages in the United States at some point?
Well, at first a global food shortage would mean rapidly rising prices for food in the supermarkets. The shelves would still be full, but people would not be able to afford to buy as much.
If a global food shortage was sharp enough and went on long enough, the price shocks would eventually turn into empty shelves and physical food shortages inside the United States.
Keep in mind, there are already tens of millions of Americans that cannot feed themselves. In the United States today, there are over 43 million Americans on food stamps. That means that approximately 1 out of every 7 Americans is being fed by the government.
So what is going to happen if real food shortages hit?
Already there are some very disturbing reports about food shortages in the U.S. floating around out there.
For example, the following is an excerpt from an alert that Steve Quayle recently posted on his website….
Having been one of the largest freeze dried food dealers in the U.S. for a number of years, I can tell you that this event is ominous. There are less than a dozen freeze drying food production facilities of consequence in the U.S. of which Mountain House is the largest. I was contacted late Wednesday night by one of their major dealers. He stated that Mountain House only had 4 entrees of foil packaged food available in their warehouse. They informed my dealer friend that “It was only going to get worse”!
The early warning signs are right there in front of us. This has the potential to start getting very real.
Are you ready? Are you prepared for price shocks? Are you prepared for food shortages? Are you prepared for a global economic meltdown?
The number of “preppers” in the United States has not exploded just because millions of Americans suddenly wanted to pick up a new hobby. The truth is that over the last several years people have been waking up and have started realizing that the global economic system is heading for some really, really hard times.
Many believe that we are heading into what could potentially be some of the most chaotic times in all of human history. Life in the years ahead is likely to be very different from what we are experiencing now. The world is rapidly changing. Now is the time to start getting prepared.
This article was posted: Friday, January 14, 2011 at 5:45 am