The Last Post on July 2018 Soybean Futures

Because they expire today! And at this time, barring transport costs, etc., the futures and spot prices should converge. At 814, they are down 22.4% from levels recorded in late May.

Why the sharp decline? Weather? News about the harvests elsewhere? The dollar? Tariffs? Gremlins? I leave it to the reader to assess the causes. As of 7/12, MacroTrends reports cash prices at $8.3375/bu. I attribute the majority of the price decline on the imposition of Chinese tariffs on US soybeans.

For a typical farm in Indiana, the cash (not taking into account opportunity cost) breakeven is exceeded. The economic breakeven is missed by about $2/bushel (see here).

84 thoughts on “The Last Post on July 2018 Soybean Futures

  1. Moses Herzog

    That first sentence I was like “OMG, the commenters have finally done it!!! They p*ssed off Menzie enough he’s finally had it.”

    One thing that surprises me, I go to an Illinois website to look at some of the agriculture numbers they crunch, and it seems like they white-wash a lot of this soybeans and corn stuff. They lower the numbers, but they still put up numbers for if the tariffs don’t happen, which is/was pretty much a foregone conclusion by very late June. Then their numbers including the tariffs still seem to be done wearing rose-tinted glasses. I suspect the two guys that crunch the numbers for the Illinois Uni website are knowingly lying to their audience (of I assume mostly farmers). I’m not going to mention them by name, but they have in essence a webpage tied to Illini and a youtube link they put up roughly weekly. I don’t have much doubt they know they are lying to the positive side on the numbers of how the tariffs affect farmers—what I can’t figure out is, what is their incentive to lie?? None of this is sarcasm, I really believe these guys are lying, but again it seems strange when they are judged largely by accuracy—but the numbers they use for 2019 estimates on corn and soybeans are totally out of wack for any sense of reality. I think it’s a disservice to some farmers that still think Trump is going to “save” them.

    Reply
  2. 2slugbaits

    I believe the MacroTrends prices reflect the average price across the country. If you’re an Iowa farmer the relevant price is the cash price at the local grain elevator. So if you’re a soybean farmer in the heart of the soybean belt, then you’re competing with other huge producers of soybeans, which drives down the price. An Iowa soybean farmer is not going to get the same price as a soybean farmer in another part of the country where competition at local grain elevators is not nearly as intense.

    Reply
    1. CoRev

      2slugs, you are making some gross assumptions of quantity and quality required. Large quantity orders are typically going to go to areas where their need can be filled with the fewest orders and similar shipping costs, Iowa for example. If you are buying No 1 soybeans for food stuff you will go to suppliers with plentiful No 1 quality beans. If you are buying oil quality and animal food quality beans then you will want volumes adequate to keep you plants running, and with minimal shipping costs, probably closer to home/plant.

      Also, ” If you’re an Iowa farmer the relevant price is the cash price at the local grain elevator.”, only when deciding when and where to sell. Prices and basis point can differ significantly. These are July delivery prices for 2 Iowa granaries
      1)Landus Cooperative – Earlham, IA Soybeans (#2 Yellow) 7.32 -82.00 7/1/2018 7/31/2018
      2) Heartland Coop – Waukee, IA Soybeans (#2 Yellow) 7.59 -60.00 7/1/2018 7/31/2018
      A farmer would get $6500 for a 1000 bushel load delivered to Landus, and $6990 at Heartland. Farmers do actually factor in fuel cost to deliver to the granary, and if they could gain several $100s by driving further the may very well do it.

      Now the smarter and luckier farmer will have accepted a futures contract with delivery sometime in April and May, and may very well be sitting on an Aug. or Sept. delivery.

      Reply
      1. 2slugbaits

        CoRev Landus and Heartland are both cooperatives, so the farmer would have to belong to both. Often the cooperative handles the shipping…that’s one of the rationales for having a cooperative, to pool logistics and capital resources. There’s also a timing issue of knowing what the price will be at the time the grain truck leaves the farm. There is no one single price throughout the day. Bids change constantly. The grain also has to be inspected; e.g., it may have too high of a moisture content or too many split beans to get certified as #1 or #2.

        Yes, farmers can elect to go with April or May contracts, but that means they will incur storage costs and the bank will still want to be paid. And who knows how much more damage Trump will have done between now and next Spring?

        Reply
        1. pgl

          Your efforts here are Herculean. But I have a question – is there any real point to the incessant babble from CoRev? Or is Trump paying him by the word?!

          Reply
          1. CoRev

            Pgl, only to someone with little knowledge is correcting misinformation babble. BTW, now that DOJ has indicted 12 Russian intel. officers, it would behoove Komrad pgl to watch his back. You never know which Putin poodle, agent could be next

          2. 2slugbaits

            Your efforts here are Herculean.

            Well, I mentioned this before, but way back when I was a smartass kid at a privileged school someone asked Charles V. Hamilton, the black political scientist and co-author of “Black Power”, why he spent time lecturing spoiled white kids. I always liked his answer: “Missionary Work Among Savages.” I feel the same sense of duty to educate CoRev and others. He, of course, regards that as arrogant. OTOH, I regard it as arrogant to think you know something about economics without having to go through the bother of reading a few econ textbooks. Still, one does what one can.

            https://en.wikipedia.org/wiki/Charles_V._Hamilton

          3. pgl

            I see CoRev has stooped to a new low:

            “now that DOJ has indicted 12 Russian intel. officers, it would behoove Komrad pgl to watch his back. You never know which Putin poodle, agent could be next”.

            Me? I am not on the Putin-Trump payroll but we know you are. Mueller is watching you buddy. Need some financial assistance for a good lawyer? Hint, hint – do not hire Rudy G. He talks a good game like you do but it is all dishonest gibberish.

          4. baffling

            corev’s comments on the russian indictment and then tying them to pgl is laughable. seriously, do you even understand the issue with what the russians did? that was a third grade i know you are but what am i kind of response. what an idiot you are corev. simply clueless even when you try to insult somebody! IDIOT.

          5. CoRev

            Komrad pgl, thank you for admitting I have a good game! Been hitting home, have I? I am giving back to you the same BS you have handed out FOR YEARS to others which with you disagree. I find it extremely easy to do, but easy only because it is a lazy approach to commenting. I know this, because you have almost never answered a challenge, but disappeared from the discussion.

            I therefore think a moniker for you might justly be, Putin’s lazy poodle, Komrad pgl. Beware they’re looking for those Putin agents.

            Thank you for teaching me this style of commenting.

        2. CoRev

          2slugs, again you’ve missed the point: “…cooperatives, so the farmer would have to belong to both.” If all the granaries in your County are Coops then it’s highly likely the farmer belongs to all. The point was that farmers often shop and have options on to whom they sell their soybeans. Strangle, you seem to feel that farmers have no communications on the farm to check prices. Plus, for some reason you seem to think prices are so dynamic to change within the farm to granary travel time, but assuming the farmer has comm and knows how to use it,t hey will have checked before loading and leaving the farm and verbally accepted an offer.

          The bigger issue is the soybean quality for which an offer may be withdrawn, but even this is seldom an issue. The farmer has his own test equipment to moisture test, as it is done at several periods on the farm. Damaged beans?

          Your closing statements about storage and Trump are just nonsense. Farmers usually either have access to storage or not. That decision is most often made before harvest. Trump damage???? You mean like the farmer’s access to outside jobs (most farmers do have other jobs), increased wages for those increasingly available jobs, subsidies for loss above breakeven price and not already covered by crop insurance, or did you have something else in mind?

          You folks seem to misunderstand how sophisticated are those HICKs living and working in deplorable land. You might be surprised to find there are few mules still on the farms, they have progressed beyond the 18th century.

          Reply
          1. 2slugbaits

            CoRev If all the granaries in your County are Coops then it’s highly likely the farmer belongs to all.

            Not likely. It costs money to be in a co-op. It’s far more likely that the farmer would go to a different elevator within the same co-op. For example, the Landus co-op that you mentioned has about 50 different elevators spread across central Iowa and southern Minnesota.

            you seem to think prices are so dynamic to change within the farm to granary travel time

            See my post further down for an example of the daily range in prices. But the bigger concern would be the day-to-day variability. Farmers don’t just get up in the morning, watch the news and decide to load up the truck and head on down to the grain elevator.

            Farmers usually either have access to storage or not.

            Farmers do not have unlimited access to storage. You might want to travel across I-80 during harvest season. You’ll see plenty of grain on the ground due to a lack of bins.

            Trump damage????

            You haven’t heard? Let me help you out. You see, there’s this thing called a trade war going on and soybean prices have plunged.

          2. pgl

            He missed the point? What point – that you babble incoherently. C’mon man – your rants are really getting BORING!

          3. CoRev

            2slugs, again you’re less than correct. Belonging to multiple coops is the norm. And this is just wrong: “Farmers don’t just get up in the morning, watch the news and decide to load up the truck and head on down to the grain elevator.” Off season farmers watch the prices like a hawk to take advantage of up shifts.

            Why is it you have to change the meaning of a statement to make a point?
            Me: “Farmers usually either have access to storage or not.”
            You: “Farmers do not have unlimited access to storage.” My statement was simple and plain. Either they have storage or not and if you knew anything storage is always limited. BTW, I think you meant access to unlimited storage and not unlimited access. They actually do have unlimited access, if as you mentioned they store outside or just leave the crop in the fields for later harvest. Each adds higher risk of damage, but any storage adds some level of risk.

          4. baffling

            something tells me corev has actually never even been on a farm before. cliff claven.

          5. CoRev

            Baffled, adds even less value again. Grew up in farming country spending Summers on the family farms. Still live in farming country on enough acreage to qualify as a truck farm, if you know what that means.

            Your few comment lately have been totally useless, are these topics so far from your own experience, or are you just lazy like pgl?

  3. pgl

    CoRev has been asked to read basic economics but judging from his incessant hate filled comments that show no clue – alas it appears he refuses to do so. But one more attempt – that last link was quite interesting. Let’s give lazy CoRev the Cliff Notes version:

    ‘Most enterprise budgets use economic costs rather than cash costs. This means that, in addition to cash costs and depreciation, opportunity costs are included.’

    That economic costs go beyond cash costs including the opportunity cost of capital is perhaps the most basic of all economic concepts. And alas – this does not seem to matter to CoRev.

    Reply
    1. CoRev

      Pgl and Menzie, Ohio just one state over from Indiana they teach how to do an agriculture enterprise budget. Here it is laid out in a pretty spread sheet for 2016. Farm Management Enterprise Budgets
      https://aede.osu.edu/sites/aede/files/imce/files/Farm-Management/soy-rr-no2016%20May12.xlsx

      Some of the Indiana Opportunity Costs are included in Ohio’s budget. Indiana’s definition: ” An opportunity cost represents the income that could have been earned if an input was sold or rented to someone else. Opportunity costs for unpaid family and operator labor, owned machinery, and owned land need to be included in an enterprise budget.”

      Both states actually appear to be emphasizing the breakeven cost/price for a selected crop to help make crop selection or grow no-grow analysis. Ohio seems more straight forward with some indirect costs, and Indiana less so, appearing to lump indirect/opportunity costs into their Overhead Costs category. Where and whether the Indiana Opportunity Costs actually appears in their estimates is unclear. For instance there is no category for income from equipment rental from above: “if an input was sold or rented to someone else.” This is a quite common instance in smaller farm territory.

      Your interpretations may be different.

      Reply
        1. Moses Herzog

          You have to have certain high school marks to qualify for college courses, not to mention PSAT, ACT (Which was created at the University of Iowa BTW, NOT Berkeley or Princeton) etc. At least that was my understanding when I was entering university. Unless the dumb SOB gets permission from the professor to “audit” the class, that one is not happening for CoRev. It would be awesome and admirable if CoRev decided he wanted to audit an OSU economics class. But I don’t see that in the cards for a man so enraptured by ignorance. This is one of the reasons I don’t believe “Princeton” Kopits graduated a real 4-year college. There’s no way you make certain elementary errors on a blog and then get the score you need on a PSAT and get through all those courses—-or if those people exist they are about 2 in 5,000 that actually graduate.

          Reply
          1. pgl

            Moses has some career advice for you:

            ‘It would be awesome and admirable if CoRev decided he wanted to audit an OSU economics class. But I don’t see that in the cards for a man so enraptured by ignorance. ‘

            Ignorance could be cured if you tried but we know you will not.

  4. pgl

    “At 814, they are down 22.4% from levels recorded in late May.”

    If as you have noted over and over, this drop is largely attributable to the 25% Chinese tariffs, the incidence of these tariffs on Chinese consumers is quite small. I say this as last I checked Bruce Hall did not grasp this as he wondered why the Chinese government would raise the cost of their food. No – if most of the incidence is on the supplier, then little of it goes to the consumer.

    Reply
  5. CoRev

    Menzie, using the values from your reference we find your very productive Indiana farm would lose ~$11,128 per 100 acres. That should be slightly different than what your rounded numbers produced, as the actual difference in price/bushel is actually $1.712 (10.05 – 8.338). Now if forced to sell a portion of his stored soybeans the Indian farmer would lose money. But, as I showed in Thurday prices there were no sales.

    Reply
    1. Menzie Chinn Post author

      CoRev: If soybean futures are unbiased (or at least minimum RMSPE) predictors of future spot prices, then even in three years, soybean prices will not match breakeven. Farmers gonna hold on to their stocks for three years? Think about that for a while.

      Reply
      1. CoRev

        Menzie, it’s a big IF that soybeans futures are LONG TERM predictors at all. I have been repeating the same story, farmers are not selling or not selling much into this market at these prices. Yesterday I showed the granary bids for VA, and there were zero bids for July soybeans, Bids only for delivery Sept 30, 2018. I also showed the average bids and offers for the country where there was ZERO volume of sellers and ZERO interest. It takes actual sales to differentiate any loss. Think about that for a while.

        Reply
        1. pgl

          “it’s a big IF that soybeans futures are LONG TERM predictors at all.”

          Of course this is from the incessant troll who refuses to read the vast amount of economic research Menzie has patiently provided us. What happened here – did Trump order you NOT to read any economics at all?

          Reply
          1. CoRev

            Pgl, you proudly proclaimed you provided the soybean historical prices. Why did you NOT even look at them, or at least do some comparative analyses of the peaks and valleys? Even the dumbest person on the earth should have Mark 1 eyeball capability to do that level of review. But then I’ve been wrong before.

            Keep watching your back Komrad! 12 of your friends gone how many more to go?

      2. Moses Herzog

        I’m not sure if you even gave CoRev the full three years for contemplation of crop stocks if he has the brainpower to manage that one. Just saying…..

        Reply
        1. pgl

          When you say:

          “There’s no need to bring Mark Thoma into this. He’s a very respectable man, a respectable hard-working professor, and the greatest amalgamator of economics information on the internet”.

          I agree 100%. I think you misunderstood what I was trying to say so let’s try again. It is an excellent blog. The only issue are those that pollute the comment section, which is an insult to what the great Mark Thoma is doing.

          My point is that the Usual Suspects (e.g. angry and pointless CoRev and good old PeakDishonesty) are doing their best to drag this comment section to the level of that comment section over at EconomistView. The posts are great – the comment section has become worthless.

          Reply
  6. 2slugbaits

    NW_GR110
    Des Moines, IA Fri July 13, 2018 IA Dept of Ag-USDA Market News

    IA Dept. of Ag-USDA Market News Interior Iowa Daily Grain Prices

    Closing cash grain bids offered to producers as of 1:30 p.m.
    Dollars per bushel, delivered to Interior Iowa Country Elevators.

    US 2 Yellow Corn Prices were mostly 5 cents lower for a state average of 3.01.

    US 1 Yellow Soybean Prices were mostly 15 cent lower for a state average of 7.54.

    Iowa Regions #2 Yellow Corn #1 Yellow Soybeans
    Range Avg Range Avg
    Northwest 2.94 – 3.13 3.03 7.43 – 7.59 7.51
    North Central 2.92 – 3.05 2.99 7.43 – 7.59 7.53
    Northeast 2.88 – 3.09 2.98 7.36 – 7.67 7.52
    Southwest 3.00 – 3.18 3.07 7.44 – 7.64 7.55
    South Central 2.92 – 3.20 3.01 7.51 – 7.64 7.59
    Southeast 2.94 – 3.17 3.01 7.53 – 7.73 7.61

    https://www.iowaagriculture.gov/agmarketing/dailygrainprices.asp

    Reply
  7. PeakTrader

    “China…offering financial assistance to companies across several industries to help cushion the blow of new tariffs.”

    https://www.google.com/amp/s/www.cnbc.com/amp/2018/07/11/china-slams-us-tricks-vows-to-aid-businesses-hurt-by-tariffs.html

    We should also provide financial assistance to our farmers, till the trade disputes are resolved. China’s losses in a trade war are much greater, the U.S. benefits the most in a fair trading system, and the global economy benefits from lower trade barriers.

    Reply
    1. 2slugbaits

      PeakTrader offering financial assistance to companies across several industries to help cushion the blow of new tariffs.

      Gosh golly! Who could have guessed that might happen!!! As Gomer Pyle would say, “SURPRISE! SURPRISE! SURPRISE!”

      We should also provide financial assistance to our farmers,

      You mean cushion them from the consequences of how they voted? Should we do the same for car companies that use steel? Or hog producers? Or motorcycle companies? I’ve got a better idea. How about if Trump just declares victory and gets rid of our tariffs on Chinese, Canadian, Mexican, and EU imports? If trade wars are so easy to win, (and yes, CoRev, Trump used the term “trade war”), then just say we won and unilaterally call an end to the tariffs. My bet is that China et al. would happily revert to the status quo ante, which is looking pretty good about now.

      Reply
      1. CoRev

        2slugs, guess what I think his strategy is. And, when I think he will implement it. Take the latest and bestest offer and declare victory just before ….

        And you guys will gt your panties in a bunch again as he will have out foxed, snookered your smartest and best political strategists as well as moved the trade barriers closer to advantaging the US. Give the trading world time to reach equilibrium, and then wash rinse and do it again. Y’all might find that kinda strange as you profess the status quo was just near perfect. Or have I misread your various arguments? Because, folks that’s how you have been coming across to the hicks and deplorables.

        Reply
      2. PeakTrader

        2slugbaits, sure, China would be very happy going back to the status quo. People like you, and I guess ”Gomer Pyle,” would be very happy about it. After all, if it’s broke, don’t fix it.

        Trump, and even many Democrats, understand there are problems in international trade. Correcting those problems is the right thing to do and will benefit the global economy, along with the U.S.. Of course, you easily cave-in to the communists, socialists, and corrupt. And, we should compensate U.S. firms and farmers for their losses.

        Reply
        1. pgl

          There are some problems with trade – yes. And the village idiot you adore is increasing those problems exponentially.

          Reply
    2. pgl

      “We should also provide financial assistance to our farmers”

      Which adds the deficits. I presume PeakyBoo will next advocate we pay for this with tax increases on the rich. Right?! Snicker!

      Reply
      1. PeakTrader

        Pgl, time to wake up. Even with the tax cuts, federal revenue increased:

        https://www.google.com/amp/s/www.yahoo.com/amphtml/finance/news/u-budget-deficit-jumps-first-180016123.html

        Of course, there’s still a massive spending problem. I’ve explained before how we can spend much less on Social Security, Medicare, Medicaid, and Food Stamps, while creating more taxpayers and rebuilding the military. We can also reduce spending on education, while maintaining high quality education. Trump should’ve inherited a stronger economy and a budget surplus.

        Reply
        1. pgl

          “The U.S. budget deficit widened by 16 percent to $607 billion three-quarters of the way through Donald Trump’s first full fiscal year as president, as spending accelerated faster than revenue.

          The shortfall in the nine months through June was larger than the $523 billion gap in the same period of fiscal 2017, according to a report from the Treasury Department released Thursday. Revenue rose to $2.54 trillion in the period, up 1.3 percent from a year earlier. Spending rose 3.9 percent to $3.15 trillion”.

          A 1.3% increase? Even assuming this claim is remotely true – real revenues fell per your own story. Hey Peaky – we knew you were stupid but not knowing nominal v. real? My God – you are the dumbest EVER!

          Reply
          1. PeakTrader

            Pgl, don’t be so dumb and dishonest, the article says it’s based on the first nine months of the fiscal year.

            The point, which you always weasel out of through sidetracking, is there’s a massive spending problem.

          2. pgl

            “Pgl, don’t be so dumb and dishonest, the article says it’s based on the first nine months of the fiscal year.”

            This is how Peaky replied. That would be the period ending 9/30/2017. BEFORE the tax cut.

            I’m sorry PeakyBoo – you still lied. But you always do. Your problem is that your lies are so transparent that a 2 year old can spot them.

          3. CoRev

            Pgl, you’re getting scary dumb. Your comment in part: “…the Treasury Department released Thursday. Revenue rose to $2.54 trillion in the period, up 1.3 percent from a year earlier. Spending rose 3.9 percent to $3.15 trillion”.

            A 1.3% increase? Even assuming this claim is remotely true – real revenues fell per your own story. Hey Peaky – we knew you were stupid but not knowing nominal v. real? My God – you are the dumbest EVER!”

            You blame Peak for not converting the Dept of Treasury gross receipt numbers to real vs gross? Peak gave you OFFICIAL evidence confirming his claim, and you can not accept it appearing not to even know who and what the Dept of Treasury does. You just confirmed you are the dumbest man on this planet. How did some one say that? Oh: “we knew you were stupid but not knowing what the Dept of Treasury does? My God – you are the dumbest EVER!? My God – you are the dumbest EVER!”

        2. pgl

          Leave it to PeakDishonesty to find a dishonest source of information. Let’s try http://www.bea.gov

          Table 3.2. Federal Government Current Receipts and Expenditures

          Federal revenues were $3589.2 billion as of 2017Q1 but were only $3483.4 billion as of 2018Q1. We have presented this data before. And yet PeakDishonesty tries to run his lies by us anyway. Go figure!

          Reply
          1. PeakTrader

            Pgl, you make no sense, as usual, calling me a liar when I stated exactly what the article stated:

            Federal revenue increased 1.3% and federal spending increased 3.9%.

            Talk about a weasel!

        3. 2slugbaits

          PeakTrader Did you even read your own link??? It said that nominal revenues increased 1.3 percent over last year. Still not see the problem with your post? If not, let me know and I promise to help you solve the mystery.
          Hint: It’s the kind of braindead mistake I would have expected from the blogger over at politicalcalculations.

          Reply
          1. 2slugbaits

            PeakTrader So here you’re whining about the increase in federal spending under Trump. But just a few posts above you were recommending huge bailout programs for farmers and firms hurt by Trump’s trade war. Your tolerance for cognitive dissonance is simply breathtaking.

          2. pgl

            Peaky NOW admits that this data does not include 2017Q4 or 2018Q1. And that tax cut was passed when? Oh yea – at the very end of 2017.

            Look – Peaky is a serial liar. His problem is that his lies are incredibly easy to spot.

          3. PeakTrader

            2slugbaits, you replied to only part of what I said.

            Some spending is constructive and some spending is wasteful, which I cited above.

            Of course, I expect constant irrational and irrelevant replies from Pgl, just so he can call people names, which you also follow by choosing to ignore much of what people say.

  8. Moses Herzog

    How dumb is the average American farmer?? I ask that question earnestly. If the “leader” (“Dear Leader”??) of your nation destroys many of the markets you sell your goods in, Brazil farmers snatch your profits up that Trump has given them on a silver platter, and you sit there like some deaf mute saying you “trust” “Dear Leader” Trump, where does that put you on the IQ spectrum??
    https://farmdocdaily.illinois.edu/2018/07/too-much-pork-tariffs-mean-too-few-buyers.html

    Reply
      1. Moses Herzog

        Well, there’s nothing like proving you’re an evangelical Christian like voting for a man who openly brags he grabs women’s snatch non-consensually, is there?? The first thing you do after that is go down to your evangelical minister’s residence with your “I Voted Today” sticker and pick up your pro-molestation medal and your rightful place in the front pew of the church. Otherwise why join the evangelical church??
        https://www.youtube.com/watch?v=2zEhJb2AJOE

        Reply
  9. pgl

    A good post from NewDealDemocrat correcting the record on recent wage growth:

    https://angrybearblog.com/2018/07/real-average-and-aggregate-wages-july-2018-update.html#comment-2984598

    Yes our Trump cheerleaders keep pushing that 2.7% increase in nominal compensation over the last year but I guess they do not realize that calculating real compensation requires factoring in the increase in the consumer price index which was actually larger. Of course their political bosses in the White House have access to the latest data but their jobs are to lie to us 24/7.

    Reply
  10. 2slugbaits

    Menzie In section 5 of your paper testing for the unbiasedness and market efficiency of futures markets you corrected for GARCH errors, which lowered the standard errors and allowed for rejections of the null. I dunno, a GARCH test seems kind of iffy in this case. For one thing, the data is relatively low frequency. GARCH tests are more robust with high frequency (typically financial) data. The other problem is that the observations are uneven and discontinuous, which would make me doubt the autocorrelated persistence of volatility shocks. So the GARCH results might just be a fluke.

    Reply
  11. phyron

    So… one has to wonder why most farmers did not hedge when the price was so far above their “breakeven price”
    at the very least “puts” on Beans…???

    Reply
      1. pgl

        Really? Your source for your latest “enlightening data? Wait – they shipped the same beans that they put into storage? Wow – your are a genius. Selling the same beans that you keep in storage. We’ll be RICH!

        Except you can’t do that. As usual your babbling self contradicts! Do they making up your mind which STOOOPID story you are peddling!

        Reply
        1. CoRev

          Pgl, my source? Why it was YOU, and your reference for how many soybeans shipped! And in another marvelous demonstration of ignorance, pgl wonders where the soybeans shipped in May were kept since harvest in Oct and Nov? Pgl, I’ll give you just one attempt to answer that question.

          As usual your babbling self contradicts! Please please stop commenting it is lowering the overall quality of this blog.

          Reply
    1. pgl

      CoRev I says they were hedging aka storing the beans. CoRev II says just the opposite – they shipped them before the tariffs hits.

      Get used to it. He contradicts himself faster than anyone on the planet!

      Reply
      1. CoRev

        Komrad pgl, where’s the contradiction? BTW, it was you who proudly informed us of the growth in shipments. Have you forgotten your own comments already?

        BTW, you have failed to answer 2 related requests. 1) When and at what prices were those soybeans sold for those increased shipments?
        2) What happened to those soybeans from harvest to sale and ensuing shipment? Could they have been stored????

        We need to call Komrad pgl, and others, when he/they makes sleazy and knowingly erroneous comments, otherwise he/they will continue with this lazy approach. I’ve watched pgl in action for years and it is always the same angry, lazy, disruptive, ridicule until the blog moderators finally have to ban him.

        Reply
  12. pgl

    PeakDishonesty’s latest praise of fiscal policy under Trump may have contained the usual disinformation but give him credit for this:

    “Some spending is constructive and some spending is wasteful”

    Like this?

    https://www.msn.com/en-us/news/us/detaining-immigrant-kids-is-now-a-billion-dollar-industry/ar-AAA3dlk?ocid=sf

    “Detaining immigrant children has morphed into a surging industry in the U.S. that now reaps $1 billion annually — a tenfold increase over the past decade, an Associated Press analysis finds. Health and Human Services grants for shelters, foster care and other child welfare services for detained unaccompanied and separated children soared from $74.5 million in 2007 to $958 million in 2017. The agency is also reviewing a new round of proposals amid a growing effort by the White House to keep immigrant children in government custody.”

    Since Trump and Sessions love stealing Hispanic kids from their parents – expect this spending to rise even more. I guess PeakDishonesty would call this “constructive: spending!

    Reply
    1. pgl

      Speaking of disinformation, gotta love CoRev’s feeble attempt to defend PeakDishonesty:

      ‘Pgl, remind me is the BEA data you show FY or CY?’

      Actually BEA reports QUARTERLY data which is what my FRED link showed. PeakDishonesty wants to ignore the last 2 quarters. But that’s the point – the last 2 quarters show Federal revenues as way down. And guess when the tax cut was passed. Not 1/20/2017 – try the very end of 2017.

      I could say CoRev is being really stupid here. But maybe he is not stupid as this point is incredibly obvious. But the level of dishonesty these two stoop to in order to defend their Master is just incredible.

      Reply
      1. CoRev

        Komrad Pgl, boy that’s quite a reaction to a simple question. I asked because your response ended with a date for the https://fred.stlouisfed.org/series/FGRECPT data of 01/01/2018, and his BEA DATA ends at Q1 2018, while Peak’s data ended in June 2018. Of course with Komrad pgl’s deep economics background and adept analytical abilities he noticed his apples to oranges comparison? Or did he deliberately misrepresent?

        Calling others stoopid, when he has made such elementary level mistakes shows his arrogance and foolishness.

        Reacting the way he did to a simple question shows his mental stability.

        BTW, thanks to 2slugs for answering the simple question. Komrad pgl, that thanks could have been aimed at you, instead your irrational response motivated a deeper look into your prior responses. Way to go!

        Reply
        1. pgl

          “while Peak’s data ended in June 2018.”

          Lord! No – the data was for the period ending 10/31/2017. Or do you know what a Fiscal Year even means?

          BTW – you protested that Peaky did this in terms of nominal increases rather than real increases. FYI – the BEA publishes a lot of things in real terms AND they provide information on price indices. Oh wait simple division is something you and Peaky never learned how to do.

          Please oh please keep providing such incredibly STOOOPID comments as they make the rest of us laugh!

          Reply
          1. CoRev

            Komrad pgl, while claiming others are STOOOPID, still hasn’t admitted he was comparing the WRONG FY data. Peak’s article said this: “The shortfall in the nine months through June was larger than the $523 billion gap in the same period of fiscal 2017, according to a report from the Treasury Department released Thursday.” And was printed on July 12, 2018. Thursday would have been the same data as the articles’ release. Not 2017, whether FY or CY!

            Your reading comprehension is atrocious! But, I guess not much better should be expected from the Dumbest person on the planet.

            Keep calling all of names. It just motivates us to check the validity of your comments, and they are failing miserably.

          2. CoRev

            Komrad pgl, I just noticed this egregious error: “Lord! No – the data was for the period ending 10/31/2017. Or do you know what a Fiscal Year even means?” Indeed, I do. I lived through ~30 of them. you might want to check your own knowledge of FY dates.

            BTW, “Komrad pgl, where’s the contradiction?” Or are you going to run away again?

    2. PeakTrader

      Pgl, more dishonest statements from you. Children were separated and put into cages under Obama and not a peep from you.

      You like spending lots of taxpayer money on illegal immigrants, while enticing more of them, including children, to make the dangerous journey to the U.S..

      You’re too ignorant to know what’s going on – get educated instead of brainwashed, e.g. from CNN, which obviously in your case doesn’t take much effort.

      Reply
      1. pgl

        Not a peep? Hey buckoo – I’m a card carrying member of the ACLU and we have taken this garbage you excuse to court.

        Reply
  13. Moses Herzog

    One of the things Republicans often falsely claimed about President Obama was that he got no international respect. I’m curious, do they think Britain respects trump when they view him as a baby who wears diapers?? They fly this balloon in London England, supposedly America’s greatest ally (debatable but very plausible) and most British laugh and smile because they see the image as being largely accurate. Any chance we can get the highly cerebral economics students in Madison Wisconsin to fly up a similar balloon??
    https://youtu.be/CyXL99ZP4OE?t=4m51s

    Reply
  14. Moses Herzog

    I got Ashoka Mody’s new book. WOW, 484 pages if you don’t count the end notes. I’m lucky to get through books with 250–300 pages, so it’s gonna be a heavy lift for me. Hopefully since I like the topic that will help. In the middle of a fiction book but I think I will try to read some of both each day, which I rarely do.

    Reply
  15. Moses Herzog

    Anyone interested in race relations (especially as it relates to blacks/African Americans)—I highly encourage them to read this blog. It’s by a retired college prof by the name of Paul R. Lehman. He also has written 4–5 books but I actually think his blog is better written than his books. He updates about once every 3 weeks. So you can either “subscribe” (for FREE) or get his RSS feed. YOU HAVE THE TIME to read an essay written once every 2–3 weeks, and ALWAYS enlightening. I highly recommend it:
    https://americasraceproblem.wordpress.com

    Reply

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