SitRep from the Midwest

No end to “the blip“. From today’s Des Moines Register:

Iowa farmer Lindsay Greiner no longer uses “dispute” to describe escalating trade tensions between the U.S. and China.

“I’ve tried to avoid calling this a war, but that’s what it really is. It’s not going to be resolved anytime soon,” said Greiner, who raises corn, soybeans and pigs near Keota.

China said this month it would no longer buy American farm goods, deepening concern that a new trade deal could take months, if not years, to resolve.

It was unwelcome news for Iowa and U.S. farmers, already facing spring flooding that kept many from planting crops, adding to struggles with low prices and growing supplies of corn, soybeans, pork and milk.

Further Federal government subsidization of American farmers would require Congressional action; the previous and current $28 billion support was drawn from the Commodity Credit Corporation. CCC has authority to borrow up to $30 billion.

Strange side note: 35 years ago, I was researching special interests in driving agricultural price supports for grains, as a research assistant for … Peter K. Navarro. At the time, Republicans were seeking to cut government support for such programs, given the distortions they impose. Apparently such concerns are no longer represented in the Republican party.

Update, 8/13. Reader CoRev needs to know what the window is for an “event study”. I’d say 20 min on either side of announcement is just about right in many cases. E.g., Trump wimps out on additional tariffs on China.

But, as I’ve shown for soybean futures, sometimes a day is ok, since ag news frequency isn’t necessarily high.

Darn, CoRev, are you being intentionally dense?

45 thoughts on “SitRep from the Midwest

  1. pgl

    “At the time, Republicans were seeking to cut government support for such programs, given the distortions they impose. Apparently such concerns are no longer represented in the Republican party.”

    If we had a free market – subsidies would impose distortions. The problem in 2019 is that Trump’s trade war has created its own massive distortion for which these subsidies are sort of a band aid for a patient severely bleeding.

    Reply
  2. Baffling

    As corev has illustrated, conservatives now push for a communist economy with government subsidies and market distortions. Reagan must be rolling over in his grave. And peter Navarro is killing the us economy to promote his book. Example of crony capitalism at its worst.

    Reply
    1. baffling

      navarro was just quoted as saying trump will make all farmers whole with respect to the trade war. socialists snuck into the white house under the guise of republicans.

      Reply
  3. Moses Herzog

    It seems “the blip” is now trending #2 on Twitter, right behind “CoRev named world’s smartest chimp”. I may have to double-check that.

    Reply
  4. Moses Herzog

    Is Mr. Lindsay Greiner the same farmer that CoRev eats waffles with blue berries and whip cream every Wednesday at the Polk County Farmers Prayer Breakfast?? That might explain why Greiner took many months to figure out WTF is going on in his own circle of life. Mr. Greiner has me imagining a 2019 NFL football coach saying he only just realized during the summer break that the NFL was no longer using leather helmets. I mean, this guy Greiner is a sharp one, I can tell that without even having clicked the link yet.

    You know what I say, if Mr. Greiner wants to talk bad about America and talk bad about MAGA trade policy—he needs to go back to whatever European country his ancestors came from. MAGA–love it or leave it. If Greiner hates America and hates MAGA, maybe he should go to Brazil. I don’t like people who talk bad about America, or as me and my non-college rural buds call it, ‘Merica. Why are all these Midwestern socialist welfare receiving farmers hating on America?? If Midwestern socialist welfare farmers don’t like their USDA socialist welfare checks then they can just move back to Europe—we don’t want their socialist welfare taking A$$es here in the land of MAGA central planning anyway.

    Reply
  5. pgl

    The MAGA hat wearing liars who have tried to pin the El Paso massacre on some left leaning agenda has being undercut by the admissions of Patrick Crusius himself:

    https://www.cnn.com/2019/08/09/us/el-paso-shooting-friday/index.html

    The man who authorities say killed 22 people at an El Paso Walmart told police that his targets were Mexicans, according to an arrest affidavit. In the affidavit, El Paso Police Detective Adrian Garcia said 21-year-old suspect Patrick Crusius told him, “I’m the shooter.” “The defendant stated his target were Mexicans,” according to the affidavit, which CNN has obtained and was first reported by The Washington Post.

    Reply
  6. Moses Herzog

    Truth is, these type articles grate on me quite a bit, I find them offensive, and if I think about them long enough, can even make me very angry. Having said all that—it’s useful as a “thought exercise”. So stretch those cerebrum muscles out:
    https://www.bloomberg.com/news/articles/2019-08-08/the-non-weirdness-of-negative-interest-rates

    * DO NOT TAKE THIS AS ANY KIND OF ENDORSEMENT TO PAY THE BANK FOR STORAGE AND USAGE OF YOUR OWN MONEY, AS I WOULD LIKELY TELL YOU TO PUT IT IN AN OLD SHOE BOX OR EVEN BURN IT IN GASOLINE BEFORE PAYING A BANKER TO STORE YOUR OWN DAMNED MONEY

    Reply
  7. Moses Herzog

    I think commenter pgl rightfully teased me over my dropping little movie recommendations here. But am I the only guy who thinks it’s hard to get good movie recommendations/reviews?? I guess you’re all like “No, that’s ok…. we can read Rotten Tomatoes website Moses, thanks anyway”. But eh, it is what it is. I saw this and I thought it’s a good film. It does drag a bit, but things that are slower paced can have a more realistic feel to them. But here’s a good film if you’re feeling lethargic and have some good snacks in the house, it’s called “The Public”
    https://www.youtube.com/watch?v=TlBJv9C9yYc

    Reply
  8. Moses Herzog

    Folks, I’ve watched enough things in my life, I’m here to tell you—if this guy gets nominated—there are no happy endings here—-NONE.
    https://www.youtube.com/watch?v=Am-Gi7WM5L0

    Do you REALLY wanna see the male cognitive equivalent of Nancy Pelosi running this nation?? That’s what we’re looking at here, because people don’t have any more intelligence or any more foresight than to vote for a man purely on the basis they are familiar with his last name. We tried that one about 2 and 1/2 years ago, did we not??

    Reply
  9. Moses Herzog

    Some people regularly visiting this blog think I’m sick because I usually type exactly what I’m thinking instead of playing PC games like “Is this going to upset Little Suzy Homemaker in Mesa Arizona??” I’ll just say this. I can’t recall at the moment any other time in my life that I was happy about reading about a suicide.
    https://www.nytimes.com/2019/08/10/nyregion/jeffrey-epstein-suicide.html?action=click&module=Top%20Stories&pgtype=Homepage

    Dershbag!!!! Dershbag?!??!!?! Are you out there?? Feeling depressed?? Think about dark clouds and somber music, Dershbag.
    https://twitter.com/ndrew_lawrence/status/1152048480594137090?lang=en

    Reply
  10. Moses Herzog

    Buzzfeed journalist discusses how employers who knowingly hire illegals never get punished. Something that “Princeton”Kopits celebrates nightly:
    https://youtu.be/vBLSBR0KiMM?t=390

    Or, wait….. does “Princeton”Kopits celebrate the fact that employers are NEVER punished for hiring illegals?? I guess we don’t know because whenever this topic is brought up “Princeton”Kopits magically disappears like a vomit-inducing cow fart in the wind.

    Reply
  11. Bruce Hall

    It’s all Trump’s fault… the rest of the story:
    https://www.hellenicshippingnews.com/swine-fever-set-to-reduce-chinas-soybean-imports-further-usda/ (be sure to read the 2nd last paragraph)
    https://ycharts.com/indicators/us_soybean_price_world_bank
    That works out to over $15 billion less demand for soybeans in China… regardless of source.

    Is Europe next? https://newsflash.one/2019/08/03/african-swine-fever-hits-sixth-pig-farm-in-bulgaria/

    Time to plant something else.

    Reply
      1. Bruce Hall

        Menzie, … and, geez, I didn’t say that tariffs had no effect, but ASF alone could have accounted for a portion of the reduced soybean prices and if it spreads further it could become a massive global issue. If you check back, I mentioned this issue previously.

        Perhaps investing in contamination isolated pig farms is an opportunity.

        Reply
        1. Dave

          Bruce Hall incoherently writes ” I didn’t say that tariffs had no effect, but ASF alone could have accounted for a portion of the reduced soybean prices and if it spreads further it could become a massive global issue.”

          Another blog commentator who refuses to learn what an event study is, and why/how it works.

          Reply
        2. Moses Herzog

          I get American Wine Flu all the time, what’s all the fuss about?? Just let the pigs rehydrate. Gatorade is good because you’re mainly missing electrolytes in your forehead area. I drink energy drinks 7 days a week and I know a lot about good health habits
          https://www.youtube.com/watch?v=xdZttArhtn8

          Believe me!!!!!

          Reply
    1. pgl

      I think Brucie needs to go back to preK for remedial reading classes:

      “Swine fever set to reduce China’s soybean imports further: USDA”

      We are only at the title and it seems Brucie does not know what further means even though it was clarified in the SECOND paragraph:

      “China’s soybean import demand in 2017-18 was 3 million mt below the USDA’s initial forecasts decline. That was “related to China’s reduction in soybean meal in feed rations prompted by the current trade engagement with the United States,” USDA said in a report released Friday.”

      Come on Brucie – try READING your own links before acting like the usual Trump dummy!

      Reply
      1. Bruce Hall

        whoever, nice try, but you’re off your game. Parsing doesn’t carry the day. And, apparently, you never made it past the 2nd paragraph:
        For 2018-19 the loss is projected to reach 17 million mt, while the 2019-20 loss is estimated at 22 million mt, USDA said.
        and
        Large global soybeans supplies and lower demand in China due to ASF will continue to pressure soybean prices globally, USDA said.

        As I wrote: Time to plant something else.

        Reply
        1. baffling

          At the time all this started, swine flu was not considered a significant issue to soybean demand. This is an issue that emerged over time. It was not a significant factor in futures or us farmers thought processes at the time. Bruce you are using this as an excuse after the fact. In real time, trump would wrap up this trade war in a few weeks because he was a superior deal maker compared to the Chinese-not swine flu.

          Reply
          1. pgl

            He does have the timing all wrong but least he has the sign right – unlike CoRev who thinks an inward shift of the supply curve lowers prices.

        2. pgl

          Parsing? At least I can READ what your link said. Brucie – whether I’m off my game, you never stepped up to the plate. But troll on!

          Reply
        1. pgl

          Bloomberg? OK but did you read the date?

          June 5, 2019. This is your explanation for an event that occurred a YEAR earlier.

          Hey Brucie boy – I’d buy you a calendar but you are too stupid to even know how to use that. Learn to READ – DUH!

          Reply
          1. CoRev

            Wow! baffled and pgl do not understand pricing, human psychology nor Fama. Just when did you expect to see the 2019 ASF infection to be impounded into futures prices? July 2018???? Or for that matter, when will the 2019 weather during planting be finally impounded? 2017-20XX???? Or are the tariff negotiations over? When do you expect to see their impacts FINALLY impounded in soybean prices?

            As pgl asks: “This is your explanation for an event that occurred a YEAR earlier. ” Or phrased differently, is a year+ old event ever superseded or compounded by later events? Which of these 3 events caused he greatest price changes? In the event study(s) have all three events been considered?

          2. Menzie Chinn Post author

            CoRev: As usual, you have missed the point of the discussion, which are event studies, for which we look at a small window around arrival of news…

          3. CoRev

            Menzie, then answer my questions. Which small window and which news takes preference over this past year+? ” As usual, you have missed the point of the discussion, which are event studies, for which we look at a small window around arrival of news…” Continuing to act as if only a singular eventis the cause of the price changes defies Fama.

        2. noneconomist

          If your crops are not subject to yearly planting, Bruce, how do you plant something else? Simple answer” you don’t.
          Growers of fruits and nuts don’t have that option, particularly in California, home to the country’s most prosperous agricultural economy.
          Expect losses in the$ billions for almonds, walnuts, grapes(both table and wine grapes) pistachios, oranges, and lemons. (The value of these commodities topped $16 Billion in 2017 according to the California Department of Food and Agriculture)
          In the$ millions for plenty of others: peaches, nectarines, figs, olives, tangerines, avocados, kiwi, dates, apricots, plums, and limes. Missed a few, I’m sure.
          Rather than alternate planting, it may be beyond time for alternate thinking.

          Reply
    1. pgl

      The 20 year wanted to do a social experiment? Trying to see if Wal-Mart respected the 2nd Amendment? This punk might as well been wearing his MAGA hat. What a stupid a$$.

      Reply
    2. Moses Herzog

      We had a nutjob here locally, who would travel around to different public libraries of the metro area with his phone cam, and he would take video of people reading and focus the camera on private citizens in the library—-sometimes taking his camera close to small children. After multiple warnings and many extended minutes of bothering library patrons and being alarmingly close to small children (in the children’s specified zone of the library) the library staff would call local police, then when police asked him to leave and escorted him out he claimed “his First Amendment rights had been violated” and he was thinking of filing a lawsuit against the city. Now I wanna make it clear (though at the core of the problem, it doesn’t matter), this guy was a right-winger. A very strong right-winger, we’re talking CoRev, Ed Hanson, “Princeton”Kopits and Rick Stryker territory here. But he couldn’t understand why private citizens minding their own business didn’t want some loser nutjob aiming a phone cam at them, and why him lollygagging around the children’s section of the library was worrisome to parents. He wanted everyone to know—at places that get ZERO public complaints—that he was performing an “audit”.

      Reply
    1. Moses Herzog

      “Princeton”Kopits still has reason to celebrate though….. and pop 3-4 bottles of champagne tonight. ZERO employers were charged or arrested. So I’m sure that’s a relief to guys like donald trump who employed them over decades. “Princeton”Kopits can pop the cork on the bubbly with donald trump tonight kids!!!! ZERO employers charged or arrested in workplace RAIDS!!! Life is good for supreme hypocrites, isn’t it??

      Reply
  12. Moses Herzog

    Pretty docile looking for a livestream. Interesting…….
    https://www.youtube.com/watch?v=EBs2GOYcQn8

    When Beijing finally drops the hammer it will get bloody FAST. That’s the only thing Beijing respects and the only way Beijing knows how to do it.

    Plan A: Bully the sh*t out of your own people
    Plan B: Bully the sh*t out of your own people
    Plan C: Bully the sh*t out of your own people

    Reply
    1. Moses Herzog

      BTW you can add or subtract a couple hours for time zones—but you’re basically talking east coast China, so just add on 12 hours and you got the time there. So basically it’s about 10pm HK time as I’m writing this comment. So certainly right now the traffic in the airport would be dying down. If Beijing is still stalling on their violence ramp up—roughly 10pm tonight USA time is when you want to pop in on these streams, that will be a lot more telling of the situation. Chinese aren’t like the Occupy Movement, they aren’t gonna do a “sit in” multiple days without going back home to “refresh”/sleep. And if you saw the public bathroom situation in China you’d know why.

      Reply
  13. Moses Herzog

    Wow, You know it’s been awhile since I been over there, long enough that I’m certain some societal things have changed (they changed lightning fast as I was there, so……) but it’s good to see mainland Chinese haven’t lost their obsession with black colored clothes. Lot of Johnny Cash fans over there.

    [that’s a joke}

    Reply
  14. pgl

    “CoRev was trying to defend Bruce Hall’s utter confusion. Note he earlier wrote this gibberish:
    “CoRevAugust 12, 2019 at 12:06 pm
    Wow! baffled and pgl do not understand pricing, human psychology nor Fama. Just when did you expect to see the 2019 ASF infection to be impounded into futures prices? July 2018???? Or for that matter, when will the 2019 weather during planting be finally impounded? 2017-20XX???? Or are the tariff negotiations over? When do you expect to see their impacts FINALLY impounded in soybean prices?
    As pgl asks: “This is your explanation for an event that occurred a YEAR earlier. ” Or phrased differently, is a year+ old event ever superseded or compounded by later events? Which of these 3 events caused he greatest price changes? In the event study(s) have all three events been considered?”
    The only person who understood what Fama wrote back in 1970 is CoRev? Seriously! Something that happened this summer was supposed to affect future prices back in July 2018? Now we all wish we had such crystal balls as if we did, we could all beat the market!
    Permit me to write CoRev’s infamous sentence with the correct spacing:
    “Continuing to act as if only a singular event is the cause of the price changes defies Fama.”
    Lord have mercy – I need to apologize for asking Bruce Hall to take an economics class from CoRev as CoRev does not even get the basics. CoRev claims he has read Fama but CLEARLY he has not. ”

    We have a new nominee for the DUMBEST comment in history of the internet. Our host has a new post on his follow-up and CoRev’s incredibly STUPID reply.

    Reply

Leave a Reply

Your email address will not be published.