Today’s installment of our series, Best of Daily Reckoning, 2012, is all about food — both about how to make money by selling it and about how to “make money” by giving it away.
Here at The Daily Reckoning, we think food is a pretty big deal…and as the Earth’s population explodes, we think it will become an even bigger deal — not just from a socio-economic standpoint, but also from an investment standpoint. In a pinch, the world can do without iPhones and Xboxes. Really, it can. But it can’t do very well without grains, vegetables and fruits.
Chris Mayer, editor of Capital and Crisis, has been a vigilant observer of the agriculture (and water) sector for several years. During the timespan, he has sourced a number of winning investment ideas. But he still thinks there’s plenty of money to be made, as he pointed out in an October 29, 2012 column entitled, “Feed the World, Make Money.”
Interestingly, the US government champions an entirely different way to “make money” by feeding people. The process begins by giving the food away. In a September 24, 2012 column entitled, “In Stamps We Trust: Paving the Road to Prosperity with Food Stamps,” yours truly examined the USDA Food and Nutrition Service’s assertion that, “SNAP [i.e. food stamps] is the only public benefit program which also serves as an economic stimulus.”
Yes, it’s true; this particular government agency agues that increasing the ranks of food-stamp recipients also increases economic activity.
“By generating business at local grocery stores,” the FNS asserts, “new SNAP benefits trigger labor and production demand, ultimately increasing household income and triggering additional spending…Every five percentage point increase in the national participation rate [in food stamp usage] would generate a total of $2.2 billion in economic activity.”
Hmmm…interesting. Too bad “activity” and “growth” are not synonyms.
Eric Fryfor The Daily Reckoning
Eric J. Fry, Agora Financial's Editorial Director, has been a specialist in international equities for nearly two decades. He was a professional portfolio manager for more than 10 years, specializing in international investment strategies and short-selling. Following his successes in professional money management, Mr. Fry joined the Wall Street-based publishing operations of James Grant, editor of the prestigious Grant's Interest Rate Observer. Working alongside Grant, Mr. Fry produced Grant's International and Apogee Research, institutional research products dedicated to international investment opportunities and short selling.
Mr. Fry subsequently joined Agora Inc., as Editorial Director. In this role, Mr. Fry supervises the editorial and research processes of numerous investment letters and services. Mr. Fry also publishes investment insights and commentary under his own byline as Editor of The Daily Reckoning. Mr. Fry authored the first comprehensive guide to investing internationally with American Depository Receipts. His views and investment insights have appeared in numerous publications including Time, Barron's, Wall Street Journal, International Herald Tribune, Business Week, USA Today, Los Angeles Times and Money.
Double how much they get in the SNAP program. Then let them use them for restaurants(already happening I hear), booze, drugs, cigarettes and guns. We can have economic activity splattered all over the place.
I know someone who recently lost his job and is now on the SNAP program. He claims he can now afford luxury food items that he couldn’t when he was working. This is symptomatic of what is wrong with our government. My taxes are going way up in 2013 so people with no job can live life large and enjoy foods I can’t afford.
This system is going to collapse under it’s own weight and the sooner the better.
understand that it is much better to eat at home or prepare healthy food but
when we don’t have time we don‘t thing about our health. Simply sometimes we
have money only for dinner at Mc Donald’s or Burger King. The food from these
restaurants is junk food. I want to say that I also was young and though that such
food doesn’t influence on our health bit it’s not true. From that moment that I
have problems with my stomach I eat only at home or at good restaurants.
Healthy and good food costs a lot but you have to buy it. When I don’t have
money I take NorthAndLoans and don’t regret. My health is more important that money. And I advise you not to eat all the time fast food which is not healthy for us.
The word of the day is "growth." With GDP screaming higher in the second quarter it appears social media stocks have taken this as a sign and have started showing their own outsized growth. Today, Greg Guenthner shows you how to play this trend for huge gains as the second half of the year gets in full swing...
Use what analogy you will: a car, a clock, a chemistry experiment... the point remains that the Fed believes it can control the economy. Indeed the Fed will stop at nothing to realize the goals of its dual mandate" to maximize job growth and maintain price stability. But, as Jim Rickards expalins, that conceit always ends in disaster. Read on...
When it comes to life-changing tech investments, venture capital has been at the forefront of the investment landscape. But now, there’s a new kid on the block that’s threatening the “old way” of doing things: Equity Crowdfunding. What happens when these two fields meet? Matthew Milner explains...
The NSA will tell you their surveillance programs protect you and the country from terrorists who seek to do you harm. But when you get past their talking points and prepackaged press statements, you'll find their search for enemies covers more people than you'd imagine. Mike Leahy explains...
The economist Milton Friedman didn't go far enough when he said, "Concentrated power is not rendered harmless by the good intentions of those who create it." In fact, as Bill Bonner explains, those same good intentions are often used as pavement on a road that leads to a rather ominous and fiery destination. Read on...
If the back-and-forth action in the markets has you banging your head against the wall these days, maybe you're concentrating on the wrong stocks. While the market churns near its highs and investors continue to fret over the makings of a possible correction, Asian stocks listed on U.S. exchanges are catching fire. Greg Guenthner explains...