Inflation - The "I" Word Is Coming To A Town Near You

Hello Inflation, it has been awhile, I see you on your way back again. Inflation? What inflation? Oh things like; Energy, diesel fuel, Aviation Fuel, Gasoline, Natural Gas, Milk, Wheat, Corn, Beef, Poultry, Hogs, Soy Beans, Building materials, paper, housing, Auto Prices, Health Care, Insurance, etc.

You know the basics. Also considering the wholesale inflation, which comes from fuel costs being passed on, government regulations infringing on productivity and additional fees and fines to replace the taxes and incentives. When wholesale prices go up, those are passed onto the consumer.

How do we know all this? This is not a guess by any means. We have studied these issues for quite a while. Here is why we think this. Well as far as agriculture, we know from the droughts in the major farming regions and we can tell by the commodities market.

We have seen the high temperatures and lack of water with Wheat and Corn in ID, MT, ND, SD, NE, KS. In other markets floods have hurt some crops. Also drought hurting the growing of feed for Cattle, meaning beef prices will go up. Canada MAD COW now our Mad Cow problem, problems with Japans increased tariffs on beef.

Hogs and Beef in KS cannot get the water they need. Also in farming we have seen areas where the Sierra Club is suing so many projects to stop or slow building of new reservoirs in NM, ID, CO, AZ, NV, OR, CA. Also the specialty crops are running low and not enough to meet demand, things like berries (see bear lake issues) and issues in Winnepeg and BC, grapes (2 buck chuck run supplies low), etc as well as issues with depleted soil in Central Valley CA, Desert Farmers along the AZ and CA border cannot use that amount of water since CA and AZ will need it for new housing areas, golf courses and other uses (see the Colorado river situation) Farmers VS Developers and housing in PHX, Tucson, Las Vegas, San Diego, San Bernardino, Riverside, many are predicting a bubble burst, we have seen issues in the REITs which was a little bit of a shake up.

Natural Gas from the lack of new wells being drilled, for instance off the coast of Maine and the Gulf. Lack of ability to gear up in infrastructure fast enough to supply this winter's need even though it should be a relatively non-violent winter as far as that goes-however few Hurricanes on West Coast last year showed us a lowered Jet Stream and lower latitude airflows, La Nina comes next and that means drought continued and water prices will go up and many business which use water will be worried and charge more too for their services.

I have also been studying the EU droughts and heat and the issues with their exports meaning supply will not equal demand. Humanitarian needs are at issue as well. Meanwhile the Super Crops are being blocked by EU and WTO and much of those crops may not be able to be used in all markets. Some really bad deals here for humanity. Fruit in FL and the everglades issues are getting to be a bigger deal.

Dairy Farmers in ID are up 12% but they want more money and the National Dairy Association is also pushing forward. Increased demand is putting the dairy farmers feeling that they can charge more and will soon need to upgrade. The fires in ID, MT are using up much water supplies very early and fire season has another 2.5 months left. Also CO, NM, WY not out of the season yet. What about the threat of Bird Flu?

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