Depression era crisis in farming?

In spite of stereotypes about the scale and pervasiveness of factory farming, in The United States some 99% of all working farms are family farms, and most farms have annual incomes of less than $350K.

Incomes that are rapidly collapsing, by as much as 50% according to some sources.

Why? The chart below [...]

UhOh, deflation in Q2

I’ve previously written about falling commodity prices, a trend that seems that have intensified over the past three months.

There are two charts in this post, each reflecting performance of various commodities or commodity groups over the last quarter. The chart above shows four broad commodity price series, specifically $DJAAG (agricultural commodity prices, [...]

Soft commodities are falling

So where’s the inflation?

As documented in this blog and elsewhere, as one of the policy responses to The Great Recession the United States sharply increased it’s money supply. Generally, as the the supply of money increases so does possibility of inflation. However official metrics of inflation show historically low measures, leading some [...]

Relative value trading

Sometimes its interesting to look at commodity prices not in absolute terms but relative to other assets. More precisely, how gold does it take to purchase one unit of another commodity? The chart above shows the performance of gold relative to other assets for the past three months.

How to read it: looking [...]

Looking back at commodities

I’m still looking into the sharp correction in commodity prices we’ve seen over the past few weeks. Interesting to take a longer term perspective. The chart above shows four series since April 2006 as follows: $DJAEN, Dow Jones Energy sub index, -74.35% (black area curve), $DJAIN, Dow Jones Industrial Medials -28.31% (lime area curve), [...]

Commodity wipeout or the recovery that wasn’t

Oh the forces of deflation are strong! What’s happening to commodity prices? In spite of claims about an economic recovery, we’re seeing a broad decline in commodity prices over the past three months. The chart above tracks $DJAEN, a measure of energy commodities (grey area curve in the background), $DJAPR (red line), a measure [...]

Paying more for energy

As a followup to yesterday’s post about the disconnect between widely reported inflation numbers and some of the components, today I’m looking at energy.

The chart above shows the average hourly earnings of all employees (CES0500000003, black line) compared to two other series. As before, I’m presenting the Consumer Price Index for All [...]

Paying more to eat

One of the great puzzles about The Fed’s Quantitative Easing profligacy has been inflation: specifically, where is it?. While I discussed this phenomenon a couple of months ago, specifically pointing out that the velocity of money was at near term lows while the supply of money was increasing wildly, I thought I’d look deeper. [...]

Precious metals are booming!

The European Central Bank did it, the Bank of England did it, The US Federal Reserve did it and yesterday the Bank of Japan just done it.

As the chart above shows, gold and silver responded accordingly, soaring 13.21% and 24.75% respectively since the global easing began in earnest in late July. The [...]

Releasing oil from the SPR?

With the average price of gas $3.70 a gallon, up almost 9% from a month ago and an election approaching, what a surprise we’re hearing rumours about an “emergency” release of oil from America’s Strategic Petroleum Reserve (SPR). Curious about the effects of previous releases on the price of oil, I thought I’d look [...]