First It’s Energy, Then It’s Food

As we have warned repeatedly, ever since the Iran war started on February 28, first it’s energy, then it’s food.

We mean that people will feel the impact of the war at the gas pump and in household energy bills first.  But next it will hit us really hard at the grocery store.   So here we go, because now it’s unavoidable!

Energy prices are in the news daily, with special attention paid to diesel fuel prices.  That is the forerunner of higher food prices as all that heavy farm equipment uses diesel just as everything moves from the farm to the supermarket on trucks. 

By now everyone should know that the war’s impact on food prices extends beyond diesel prices.  The price of fertilizer has raced higher because of the war.   That will mean reduced yields.  The UN’s Food and Agriculture Organization reports that global food prices were up 33 percent in August from a year earlier.  Among the most notable price impacts is that in vegetable oil, grains, and meat.  

Yet to be fully appreciated is the full impact the El Nino weather pattern may have on agriculture, although it is being called one of the largest events on record.   It is safe to say that early large-scale disruptions are already becoming visible.

You will note that already Washington is telling you to tighten your belt.  Instead of managing an honest currency that retains its purchasing power, we are being instructed how to substitute what we used to be able to afford with cheaper alternatives.  When she was confronted with complaints about soaring beef prices, Agriculture Secretary Brooke Rollins offered this advice: “If beef is too expensive… you can eat chicken, pork, salmon, eggs.” 

Why exactly will you be glad to have a good store of gold and silver on hand as the food price inflation plays out?  Because your dollars will buy less food, while ounces of gold and silver will buy more.  

Accept no substitutes!