How To Invest For The Global
Food Crisis
Jim Rogers has said for years that the best
career choice for many would be to find a way to get involved in agriculture. He
said in a recent interview.....
There's going to be a huge shift in American society, American culture,
in the places where one is going to get rich. The stock brokers are going to be
driving taxis. The smart ones will learn to drive tractors so they can work for
the smart farmers. The farmers are going to be driving Lamborghinis. I'm telling
you. You should start Farming....
Rogers has had a good decade as someone
invested in farmland, commodities, and is enjoying the Asian boom of the last
decade. In 2004 he wrote "Hot Commodities", and then in 2007 wrote "A Bull In
China". He's predicting that the 21st Century will be the century of
China.
The basic argument that farming is going to
become a profitable venture over the next couple of decades isn't just held by
Rogers, but is also defended by other wealthy investors too....
We are five years into a severe global food
crisis that is very unlikely to go away... It will threaten poor countries with
increased malnutrition and starvation and even collapse... Resource squabbles
and waves of food-induced migration will threaten global stability and global
growth. This threat is badly underestimated by almost everybody and all
institutions with the possible exception of some military
establishments.
The political impacts have already been seen
just last year with the Arab uprisings. The Internet made the uprisings more
likely, but exploding food prices were the catalyst. Don't expect that to stop
anytime soon. It could be years before the food prices problem handles
itself.
What's Causing The Food
Crisis?
The food crisis isn't so cut and dry, however.
Increasing global population, fewer people focusing on farming and going to
other industries, and potential global warming have all led to food prices
increasing. Add in the world's governments trying to flood the world with paper
money to generate "growth", and the situation becomes more volatile.
It's important to note, however, that this
isn't just a short-term opportunity, or about any single company in particular.
This is a global trend impacting billions of people, and it won't disappear
anytime soon. Food prices will continue to increase, and this means successful
farming operations will see profit margins dramatically increase.
What Investors Should
Do:
Personally, I've been
looking into buying a small farm over the next couple of years, though I haven't
decided on it yet......
My
thoughts...
Umesh Shanmugam
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