Niall Ferguson on U.S.; Jim Rogers on China

And now for the real economy

My previous post discussed the simulacra, the simulation of the real economy. Ambrose Evans-Pritchard picks up on Jim Rogers' agricultural theme and runs with it: Food will never be so cheap again

Barack Obama has not reversed the Bush policy on biofuels, despite food riots in a string of poor countries last year and calls for a moratorium. The subsidy of 45 cents per gallon remains.

The motive is strategic. America is weaning itself off imported energy at breakneck speed. It will not again be held hostage by oil demagogues, or humiliated by states that cannot feed themselves. Those Beijing students who laughed at US Treasury Secretary Tim Geithner may not enjoy the last laugh. The US is the agricultural superpower. Foes will discover why that matters.

The world population is adding "another Britain" every year. This will continue until mid-century. By then we will have an extra 2.4bn mouths to feed.
China and Southeast Asia are switching to animal-protein diets as they grow wealthy, as the Koreans did before them. It takes roughly 3-5kgs of animal feed from grains to produce 1kg of meat.

A report by Standard Chartered, The End of Cheap Food, said North Africa and the Middle East have already hit the buffers. The region imports 71pc of its rice and 58pc of its corn. It lacks water to boost output. The population is growing fast. It will have to import, and cross fingers.

The UN says global farm yields must rise 77pc, which means redoubling Norman Borlaug's "green revolution". It will not be easy. China's trend growth in crops yields has slipped from 3.1pc a year in the early 1960s to 0.9pc over the last decade

"We've all heard the stark anecdotes: precious topsoil weakened by over-farming, dust clouds darkening the Asian skies, parched land becoming desert and rivers running dry," said Mr Grice.

Later in the article, he lists some stocks:

Mr Grice remains an optimist, believing that human ingenuity will rescue us. You can trade the "Ag" rally by investing in exchange traded funds (ETFs), but this amounts to speculation on food. There are ancient taboos against this practice.

Or you can invest in the bio-tech, fertiliser, and land services companies that will both make money and help to solve the problem. Monsanto, Syngenta, and Potash are popular, but trade at high price to book values. Golden Agri-Resources, Yara, Agrium, and Bunge are at better multiples.

Kingsmill Bond at Moscow's Troika Dialog suggests the Baltic company Trigon Agri as a way to play the catch-up story in the Eurasian steppe. He likes sunflower processor Kernel, grain group Razgulay, and fertiliser firm Uralkali.

There are some agricultural stocks listed in Hong Kong that look attractive as well, and there's always the option of farmland itself.

More Jim Rogers Interviews

Jim's beating the drums again on agricultural commodities and China.

Excellent Interview with Jim Rogers

Not a lot of new information here, but he fleshes out a few of his arguments.

占·羅傑斯 — 美国政府“摧毁纽约作为金融中心“

占·羅傑斯告诉了CNBC Asia's Martin Soong:

“你正在看的东西在我们眼前，非常从历史上看，它基本上摧毁纽约作为金融中心和破坏美国作为世界上最强大的国家 ” (Google翻译）

英文视频

还有两个跟Hugh Hendry 的采访：
美国国际集团已经死了
关于定量宽松

我想在今年年底前将表明，量化宽松不会成功的一种环境，使他们在美国的债务相当于全球国内生产总值。你怎么能诱使人们采取更加债务？(Google翻译）