News Matters for 16 February 2011

Hello all!

I’ve decided to start sharing some of the headlines that relate to the coming times and preparedness/survival issues. The news matters no matter what you may feel about it. It’s important to pay attention to what is going on around us as that may sometimes be the only way to receive a warning of what we need to prepare for in these coming times. Today, we see a rising cost in both food and clothing, but why? We can find the answer to this question and more simply by paying attention to the news. Simply click onto the headlines and you will be taken to the story connected to that headline.

February 15, 2011 –
DHS Daily Open Source Infrastructure Report (PDF, 25 pages – 345 KB)

The Daily Open Source Infrastructure Report is a DHS compilation of selected news articles from around the country regarding emergency and disater news. Well worth reading, and it’s keeps you up to date on what may be happening around you.

Food Matters;

Is the World Producing Enough Food?

Food prices are zooming again for reasons besides bad weather, climate change and global growth.

Drought in China threatens wheat crop and send global prices soaring

UN Food and Agriculture Organization (FAO) warned that a severe drought was threatening China’s wheat crop and could result in shortages of drinking water; analysts fear that wheat prices could soar even higher if China were to begin importing large quantities of food to feed more than a billion hungry mouths; wheat prices are already at record highs and have sparked food related protests around the world; surging prices are partially responsible for Egypt and Tunisia’s recent mass uprisings; China’s Shandong province, a major agricultural region, has only received fifteen percent of its normal rain levels; in dire terms Chinese state media reported that “land is drying out, and the crops are dying….

Infrastructure Matters;

Egypt Leaders Found ‘Off’ Switch for Internet

A blackout during protests has mesmerized technical experts and raised concerns about other governments.

Cyberweapon could cause Internet doomsday

Researchers show that an attack by a large botnet — a network of computers infected with software that allows them to be externally controlled — could take down the Internet; the researchers reckon that 250,000 such machines would be enough to do the job; a sustained 20-minute attack by the 250,000-strong army — they will be sending waves of border gateway protocol (BGP) updates to every router in the world — would overwhelm the net, bringing Web servers down by overloading them with traffic….

Political Matters;

Michael Boldin: California – a nullifier’s paradise?

…States around the country are considering laws to reject federal laws on health care, guns, the Environmental Protection Agency regulations and more. The pundits scream “racism,” the legal experts cite the “supremacy clause,” and the entire country – left to right – just might be missing the point…. The real question, of course, is this – will gay marriage advocates in Maine, health care nullification advocates in Idaho, gun rights activists in Oklahoma, and marijuana advocates in California ever realize that they’re actually on the same side…

Secretary Napolitano Announces “If You See Something, Say Something™” Campaign Partnership with NBA
Tue, 15 Feb 2011 06:00:00 -0600 Secretary of Homeland Security Janet Napolitano today joined National Basketball Association (NBA) Commissioner David Stern to announce a new partnership between the Department of Homeland Security’s (DHS) “If You See Something, Say Something” public awareness campaign and the NBA.

Financial Matters;

As Austerity Cuts Bite in Portugal, Discontent Grows

Portugal’s government, pressured by outsiders to shape up fiscally, now faces growing public protests and political discord over its drastic spending cuts.

Federal deficit on track for a record this fiscal year

Government debt to exceed U.S. economy

President Obama‘s budget, released Monday, was conceived as a blueprint for future spending, but it also paints the bleakest picture yet of the current fiscal year, which is on track for a record federal deficit and will see the government’s overall debt surpass the size of the total U.S. economy….Mr. Obama’s budget projects that 2011 will see the biggest one-year debt jump in history, or nearly $2 trillion, to reach $15.476 trillion by Sept. 30, the end of the fiscal year. That would be 102.6 percent of GDP — the first time since World War II that dubious figure has been reached….

Brazil Finance Chief Renews Attack on Fed

Brazilian Finance Minister Guido Mantega renewed his attack on the Fed’s most recent program of quantitative easing, saying the policy had goosed global flows of hot capital and heightened the global problems of rising commodity prices and inflation.

Retailers set to raise apparel prices this spring
Retailers and apparel manufacturers are poised to raise clothing prices about 10% this spring, reflecting the skyrocketing cost of cotton as well as cost increases for synthetic fabrics as demand for cotton alternatives rises, said Burt Flickinger III, president of Strategic Resource Group. “We have been so used to deflation for years and years,” said David Bassuk of AlixPartners. “Customers are going to be surprised.” The Washington Times/The Associated Press

It’s Never Just the Economy, Stupid

WE ARE OFTEN TOLD that we possess the most powerful military in the world and that we will face no serious threat for some time to come. We are comforted with three reassurances aimed at deflecting any serious discussion of national security: (1) that Islam is a religion of peace; (2) that we will never go to war with China because our economic interests are intertwined; and (3) that America won the Cold War and Russia is no longer our enemy. But these reassurances are myths, propagated on the right and left alike. We believe them at our peril, because serious threats are already upon us.

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Are We Running Out of Food?

MMMMM! TV dinners! Remember the old days when they used to come packaged in the aluminum trays and the tin foil covers? Today they’re all in microwaveable trays of course, but that may no matter in the future, especially if we are indeed running out of frozen foods.

The latest USDA Cold Storage Report just came out a few days ago, and the news doesn’t look good for those of us that rely upon the frozen foods industry to supply our larders. If I haven’t mentioned it before, frozen food should not be part of your long term planning, and if it is, it should be a very minor part.

But the problem here is not how the cold storage industry affects our planning, but how it affects the entire nation and the convoluted food preparation and distribution systems. The old law of supply and demand holds true here as in every other transfer of product from one source to another. High demand and low supply means high costs involved. Low demand and high levels of supply mean lower costs.

Let me share a few of the high points of the report;

Frozen food stocks in refrigerated warehouses on December 31, 2010 were greater than year earlier levels for chicken, eggs, cheese, beef and pork.

Butter stocks were up 17 percent from last month but down 38 percent from a year ago.

Total red meat supplies in freezers were up 2 percent from both the previous month and last year. Frozen pork supplies were up 2 percent from the previous month and up 1 percent from last year. Stocks of pork bellies were up 35 percent from last month but down 10 percent from last year.

Total frozen poultry supplies on December 31, 2010 were up 4 percent from the previous month and up 9 percent from a year ago. Total stocks of chicken were up 4 percent from the previous month and up 25 percent from last year. Total pounds of turkey in freezers were up 8 percent from last month but down
28 percent from December 31, 2009.

For the most part, chicken, eggs, cheese, beef and pork were all reported to be at higher levels, but going through the fine print many of the staple foods that we rely on were down for the year over year metric. Butter, which we all use for cooking and buttering that fresh cornbread, as well as pork bellies, i.e. bacon stock etc. and turkey were all down.

Do you like apples? As of 31 Dec. 2010 there were 4,893,486,000 lbs in storage, but on 31 Dec. 2011 there were only 4,571,594,000 lbs in storage, a drop of 321,892,000 lbs. That’s a lot of apples. There were also drops in the amount of pears and nuts in cold storage as well. Total frozen fruit as a gross category dropped 163,395,000 lbs to a total of 1,165,242,000 lbs. Frozen juices dropped to 337,207,000 lbs as a category.

There were also drops in most of the vegetables categories and potatoes as well. Meats and poultry seem to be on the increase, which is a good thing, but the fact that most of our base frozen food categories that give us the nutrients and fiber we need disturbs me somewhat. All told, the frozen commodities market looks like this;

The bottom line here is that we see a drop of 1,086,698,000 lbs compared to 12 months earlier. Where did this food go, and how will it affect our preparedness and survival planning down the road?

First of all, the food didn’t actually go anywhere. It just wasn’t frozen, and/or it was sold as fresh food at market of to processors. A good portion of our crops were also destroyed by weather as well, and don’t forget that a growing percentage of our food crops such as corn, grasses, sugar beets and so forth are being gobbled up by the ethanol industry to support the Gaiaists drive to stop that old nonexistent global warming trend by making us consume more poor quality fuel.

The end result is that we have a decline in the quantity of frozen food available for consumption, but we have a growing population ready to consume that diminished supply. This means our food prices will be increasing above and beyond what they normally would increase over the coming year’s time. We have a double whammy in store for our food budgets for two reasons here. The first reason is the same one I reported to you several months ago on my radio program. The costs of production have been rising, in some cases exponentially and the wholesale prices have been rising for some months. The retail sector can no longer absorb the increased costs and are now raising prices to compensate for their loss of profits. And now we have to add into the matrix the lowered food supply thus feeding the supply and demand rule that also can drive costs upward.

You can translate that into higher long term storage foods as well. I recommended that you make your food purchases a few months ago before prices went up, and over the last few days of tracking prices at some of the supply house I see some huge increases, and many suppliers are reporting low stock and sometimes no stock on a growing numbers of products.

This is where paying attention to the markets can help you develop your long term plans. Watch the commodities prices and remember that wholesale increases precede retail prices, in some cases by several months. This will give you time to set your financial needs to right to buy before we see the retail level hikes in our needs.

To get back to the question of “are we running out of food” I think it’s fair to say probably not, even though we will see a decline in the availability of many food products over the next year or two. A good weather year in 2012 coupled with increases in plantings will eventually lead to lower costs. However, we do still need to remember that costs of production also lead to higher costs as well as the supply/demand equation.
 

Pay attention to what’s going on around you and you’ll be better prepared to survive the coming times.

(source for figures: NASS/USDA Cold Storage Report, 21 January 2011.)