Food for Thought
With commodity prices, there are a number of forces at play working to increase prices, including a thirst for natural resources in China and other emerging markets, a natural disaster in Australia, and the La Niña effect on agricultural harvests. As long as the global economy is expanding as rapidly as it is, we should expect upward pressure on food prices, now at a record high. In the clip below, Bill Fleckenstein and Dylan Ratigan also talk about commodity price inflation and linkages to pro-inflationary monetary policy in the US and the developed economies. Read some of the related posts from this past November below for comments on this issue pointing to the potential for the civil unrest which we now see.
On the issue of fiat currency and the gold standard that Fleckenstein mentions, see the following posts:
- Wait for the next crisis for reform of the monetary system Dec 2010
- Credit crises, market equilibrium, economic policy and fiat currencies Jan 2010
- The Age of the Fiat Currency: A 38-year experiment in inflation Apr 2009
- A New World Order Nov 2008
They should offer a historical perspective on why fiat money has contributed to financial instability.
About Edward Harrison
- On Food Price Inflation 16 Nov 2010
- Indonesia on Food inflation: Let them eat garden food 7 Jan 2011
- Is Food Crisis Around the Corner? 22 Nov 2010
- Rising Food Prices Likely To Push EM Central Banks Into Tightening 1 Oct 2010
- Chart of the day: Inflation 13 Jun 2008