Friday, February 4, 2011

An Emerging Problem of Significant Consequence


I must comment on the following article that has appeared in the WSJ today:

Mohindru, Sameer, 2011. U.N. food price index hits record high. The Wall Street Journal, Feb, 3.

From the article:

"The United Nations has said its monthly food price index moved to a record high in January due to higher global prices of cereal, sugar and vegetable oils.

The index, published Thursday by the U.N.'s Food and Agriculture Organization, rose for the seventh consecutive month to 231 points and is up 3.4% on the month." bold added

I think that food prices will go even higher. Several high profile crop disasters, Quantitative Easing II, poor forecasting, corn and sugarcane use for ethanol, lack of crop bio-diversity, a shortage of water, several significant disease outbreaks, and market inefficiencies are just of few of the factors that will drive prices up for agricultural commodities as well as for fruits and vegetables.

There is no question that rising food prices will cause global civil unrest.

For more comments on this issue, see my blog post:


I hope to do two papers on this topic within the next month. It is very important.

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