A recent statement by the world’s economic ministers declared that shortages and skyrocketing prices for food posed a potentially greater threat to economic and political stability than the turmoil in capital markets. The sharp sudden rise in prices in the middle east have sparked waves of protests by angry civilians frustrated with the governments efforts to uphold economic policies beneficial to the nation. Some crops in Egypt and Saudi Arabia have increased 15-20% on a monthly basis since the start of the year doubling prices from some basic necessities. Governments have increased subsidies on skyrocketing prices with no apparent direct intervention on the farming communities.
14
Apr
08
And in what currency is food being traded on international markets?
Perhaps, if we changed that currency …
I dont know about you but I buy my Apples in Kuwaiti Dinars when im in Kuwait.
And are all these apples produced/grown in Kuwait?
http://www.linkedin.com/answers/financial-markets/futures-markets/MKT_FUT/210784-6828686
A good read.
From The Times
April 16, 2008
French cuisine and the rising cost of rice
Carl Mortished: World business briefing
http://business.timesonline.co.uk/tol/business/columnists/article3753806.ece
SNIPS
The [Common Agricultural Policy (CAP) of the European Union (EU)] has been a colossally wasteful experiment that diverted vast resources into shoring up inefficient farms, taxpayer euros that could have been invested better in transport infrastructure, scientific research and education.
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In our hearts, we know the real cause of famine. It is not drought or pestilence but ignorance and fear.
But it was all predicted twenty years ago when the EU had food mountains and milk lakes.
And now, the US dollar is causing shortage of food, that is, the opposite of mountains and lakes.
Here’s from the back cover of a 1987 book
Richard Cottrell, “The Sacred Cow – the Folly of Europe’s Food Mountains”, London, Grafton books, 1987:
The bizarre inside story of the bureaucratic folly and extravagance which have paralysed and all but bankrupted the [EU], and made swollen food mountains and wine lakes into permanent features of the European landscape.
The US dollar has changed all this.
And the euro was therefore going to replace the US dollar.
However, the return to power of Italy’s Silvio Berlusconi will now destroy the euro also.
Berlusconi plans Paris-Rome axis to humble European Central Bank
By Ambrose Evans-Pritchard
The Daily Telegraph, 16/04/2008
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/04/16/cnburly116.xml
SNIP
Silvio Berlusconi’s return to power in Italy is a nightmare come true for the European Central Bank, opening the way for a Rome-Paris axis with the political muscle to force a change in monetary policy.
The billionaire politician has pledged an alliance with France’s Nicolas Sarkozy aimed at humbling the bank and asserting the primacy of elected leaders over interest rates and the currency.
“A very strong euro is hurting Italy’s economy. I will discuss intervening with the ECB with Sarkozy,” he said.
The threat brought a sharp retort yesterday from the ECB’s German governor and chief economist Jurgen Stark. “I would recommend to political leaders in Europe, newly elected and re-elected, to read the European law on the ECB,” he said.
Shall we have to price agricultural products in Freegold?
Freegold is a freely floating price of gold as an alternative to the dollar regime.
Freegold makes gold the natural vehicle to temporarily or eternally store one’s wealth in, in order to be able to later convert it into tangible wealth.
Freegold in the central banks’ strong-rooms has the same role to fulfill as the Mona Lisa in the Louvre-museum in Paris.
A wealth reserve which would now be in the strong room (the Louvre) of a monetary union.
To quote again from the back cover of Cottrell’s book:
In this devastating exposé of secret transactions and official double-think, Richard Cottrell, Euro MP [Member of the European Parliament] for Bristol and Bath, reveals how the sacred cow of Europe’s common agricultural policy is leading us towards a world food crisis. In creating the biggest agricultural machine in history, the European countries have crushed the fragile economies of Third World nations, while in Europe the balance nature has been destroyed by agricultural over-production,
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[The CAP [… ]] inspires widespread revulsion at a time when half the world is starving.
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In its breadth of detail and the sustained force of the argument, “The Sacred Cow” presents a challenging case for the ending of all forms of state support for agriculture. It is a case which has to be answered if the political collapse of Western Europe is to be averted.
So there we are:
The dollar can no longer do it.
The euro will soon no longer be able to replace the dollar.
Will we be saved by gold?
Ivo:
“And in what currency is food being traded on international markets?
Perhaps, if we changed that currency …”
I agree with IVO, weshould make a new currency just for crops and meat.
The problem is skyrocketing WORLD food prices.
The problem is NOT unavailability of food.
Wouldn’t the first question then be why WORLD food prices are skyrocketing?
The same reasoning must be applied for skyrocketing OIL prices.
The problem is skyrocketing OIL prices.
The problem is NOT unavailability of OIL.
Wouldn’t the first question then be why OIL prices are skyrocketing?
Could the reason be
that both world OIL markets and world FOOD markets
are being denominated in worthless green paper, also known as the US dollar?
Today, the price of FOOD, also on the internal Kuwaiti market, is apparently not being determined by local supply and demand factors only.
No KTDP,
We should not create a new currency just for crops and meat.
We should trade crops and meat for/in Honest Money.
This will make it impossible to create the impression
which is presently being created
that we are faced with a shortage of food,
that is, with the opposite of the EU’s food mountains and milk lakes.
Gulf News, April 17, 2008 (1):
- there is NO LOGICAL EXPLANATION (Ivo: the dollar is the explanation) for the soaring oil prices so far
- the world, under the domination of a SOLE POWER (Ivo: that’s unipolarity)
Foreign Affairs , May/June 2008 (2);
nonpolarity is replacing unipolarity
Washington Post, April 12, 2008 (3):
- a shift away from dollar and toward euro has already happened
- food could be priced in local currencies, or some combination of reserve currencies
- this will be a multipolar financial system (even though the political system may be unipolar or nonppolar)
Enter the SCO, the Shanghai Cooperation Organisation.
To quote from my April 9th, 2008 “Nationalization, hyperinflation, SCO and Iran war”-entry on my blog (endnotes omitted) (4):
Iran is moving to join the Shanghai Cooperation Organization (SCO), said the Russian news agency op 24 March 2008
and the SCO Chief welcomes Iran’s membership, said IranMania.com on 29 March 2008.
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The SCO is an intergovernmental organization which was founded on June 14, 2001 by leaders of the People’s Republic of China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan. Except for Uzbekistan, the other countries had been members of the Shanghai Five; after the inclusion of Uzbekistan in 2001, the members renamed the organization. Many have looked at this organization as a counter to the North Atlantic Treaty Organization (NATO).
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Four countries India, Mongolia, Pakistan and … Iran have observer status at the SCO.
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As I said, Iran is now moving to join the SCO and the SCO Chief welcomes Iran’s membership.
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Even though US presidential candidate for the Republican party, John McCain, was still arguing
on 10 February 2007 that we live in a MULTIPOLAR SYSTEM
we seem to be evolving towards a UNIPOLAR SYSTEM whereby the SCO will be the only pole left.
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“What is a uni-polar world?” asked Russian president Putin on 10 February 2007. “No matter how we beautify this term, it means one single centre of power, one single centre of force and one single master,” he said.
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The joining of Iran is at present leading to world tensions which are similar to these preceding the First World War.
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Is it then really surprising that Another
(http://www.usagold.com/goldtrail/archives/another1.html
- note the sarcasm of the site’s name – USA-gold )
currency will take over as world reserve currency?
This is important as the People’s Bank of China wants now to diversify the reserves (the backing) of the yuan
and bought last week a 1.6% stake in France’s Total.
That was the Iranian SCO-pole.
Here’s the Iraqi pole:
Upcoming Ministerial Iraq Conf. in Kuwait “very important” - Ban
UNITED NATIONS, 16 April 2008 (Kuwait News Agency (KUNA))
http://www.iraqupdates.com/scr/preview.php?article=29941
SNIP
Secretary-General Ban Ki-moon on Tuesday described the upcoming Ministerial International Conference on Iraq, scheduled to be held in Kuwait on April 21-22 as “very important” and expressed regret that he will not be able to attend in person.
“This is going to be a very important meeting. Unfortunately for me, I will not be able to participate in person because of scheduling problem. I will be visiting African countries exactly on that day,”
Ivo Cerckel
Notes
(1)
The world badly needs a balancing of powers
By Dr Mohammad Al Asoomi, Special to Gulf News
Published: April 17, 2008, 00:15
http://www.gulf-news.com/business/Comment_and_Analysis/10206131.html
SNIP
There is NO LOGICAL EXPLANATION for the soaring oil prices so far, especially that there is a balance between supply and demand in international markets, which does not explain the price rising to $112 last week.
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The world, under the domination of a SOLE POWER, has become more complicated, which requires restoring a balance between influential players. This is necessary to enable people to live within a state of balance and be provided with their food and basic commodities.
(2)
The Age of Nonpolarity
What Will Follow U.S. Dominance
By Richard N. Haass
From Foreign Affairs , May/June 2008
http://www.foreignaffairs.org/20080501faessay87304/richard-n-haass/the-age-of-nonpolarity.html
Summary: The United States’ UNIPOLAR moment is over. International relations in the twenty-first century will be defined by NONPOLARITY. Power will be diffuse rather than concentrated, and the influence of nation-states will decline as that of nonstate actors increases. But this is not all bad news for the United States; Washington can still manage the transition and make the world a safer place.
(3)
Dollar-based system is past its global prime
The Washington Post, April 12, 2008 6:00 a.m.
http://www.journalgazette.net/apps/pbcs.dll/article?AID=/JG/20080412/BIZ01/804120379
SNIP
To a degree, a SHIFT away from the dollar and toward the euro HAS ALREADY HAPPENED. But taking that a step further and making it an explicit policy might be a way to ease global inflationary pressures, reduce the risk of bubbles and generally make the global financial system more flexible and stable. In time, a third currency - the Chinese yuan - could be added to
the mix.
In such a MULTIPOLAR financial system, Asian exporters such as China and Taiwan, and Mideast oil-producing countries such as Saudi Arabia, would no longer peg their currencies to the dollar. They could either let them float freely or tie them to a basket of currencies that better reflected their trade and investment flows. Commodities such as oil, copper and wheat would be priced in local currencies, or some COMBINATION OF RESERVE CURRENCIES.
(4)
Nationalization, hyperinflation, SCO and Iran war
http://bphouse.com/blaze/honest_money/2008/04/09/nationalization-hyperinflation-sco-and-iran-war/
SNIP
SCO Chief welcomes Iran’s membership. (SCO is the Shanghai Cooperation Organization)
OPEC President Chakib Khelil said at a conference in London on Tuesday that “the downfall of the dollar” was a major concern for the cartel, says The Los Angeles Times.
Oil surges as investors hunt an ‘anti-dollar’
By Ambrose Evans-Pritchard
The Daily Telegraph 17/04/2008
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/04/17/cnoil117.xml
SNIPS
Oil prices have surged to almost $115 a barrel as China builds up stocks before the Olympics and hedge funds pour money into commodity futures as a way to exploit the collapse of the dollar.
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Analysts say it is no coincidence that oil punched higher on the same day that the euro reached a record of $1.5979, up 28pc in two years.