People get pretty pissed off when they are starving. Thank Ben Bernanke for the exploding tensions around the world. And food prices are poised to soar in 2013.
Food Prices + Hunger Index = Riots, Civil Wars and Revolutions
By Russ Winter
09/17/2012
For every 10 percent increase in global food prices there is a 100 percent increase in anti-government protests, according to a recent report from the International Monetary Fund. Looking at recent price increases in global ag commodities — up about 20 percent so far this year — it’s no wonder there are Arab Fall flare ups (this time directed at America) breaking out across the globe. According to the IMF, a 20 percent increase in foodstuffs should triple the levels of unrest, and that seems to be precisely what’s happening.
The chaos caused by food inflation and hunger back in 2011 was heartwarmingly marketed by propagandists as democratization. Remember the French Revolution and “let them eat cake.” The causa proxima was food inflation, not stupid remarks or films. I hypothesize: Food Price Index + FAO Hunger Index = Riots, Civil Wars and Revolutions.
The United Nations’ Food and Agriculture Organization also offers a Global Hunger Index that measures levels of food stress around the world. According to the 2011 index, a hunger level above 30 is considered extremely alarming, 20 to 29 is alarming and 10 to 19 is serious.
Among the countries to watch is Nigeria with a level of 16. About 10 percent of U.S. oil imports come from Nigeria, and it’s the sweet oil variety that can’t be substituted if disrupted. In 2011, Yemen, which is in open disorder and a completely failed state, had a hunger index of 25. Angola, another oil producer, had a hunger index of 27 and considered be in the “extremely alarming” category. Cameroon, a small African oil producer, had a score of 18. That country was severely impacted by food riots during the 2008 commodity bubble. Both Bangladesh and India were ranked 24. Both countries were impacted this year by a poor monsoon period, which normally brings much-needed rain for crops. Trouble spot Pakistan is 21.
India Whole Food Inflation
Obviously, not all countries are in high-hunger-index situations, but most of the world is spending a larger percentage of income on food. This includes 48 million Americans qualifying for food stamps. A 35 percent pop in prices for people already paying 30 percent of their income on food has the effect of triggering civil unrest.
Egypt is the world’s largest wheat importer, bringing in 60 percent of what it consumes from varied global sources. Egypt also imports 40 percent of its food and is highly vulnerable to rationing and steep prices. On average, Egyptians use 42 percent of their income on food. Watch wheat prices carefully. It is showing new signs of another lift off since the Fed’s open-opended QE announcement.
Egypt’s Monthly Spending by Category
Wheat Prices
A new quantitative easing program is oppressive in a strong food-inflation environment. It also aggravates the effect of the drought and encourages speculators to pile into commodities that are already facing rationing. The Bank of Japan released a report that examines the financialization of commodities. With some big players effectively substituting foodstuffs and other commodities for near-zero-percent returns at the bank, the heightened interest in these commodities goes far beyond normal economic demand. It is key to understanding the impact of both QE and Zero Interest Rate Policy (ZIRP). The end result of the monetary experiment is a massive misallocation of capital, resulting in global hunger and social-political instability. Indeed, this is Ben Bernanke’s ultimate gesture to global food consumers.
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Source: Wall Street Examiner
Jackson, who believes in survival of the fattest and the feckless, says:
Americans should be thankful that their government is well prepared for the protests. More police firepower, police-military cooperation, and internment camps are examples of this. Those of you who make and have enough to survive and those of you who are worthless but well entitled should get along comfortably. Your government and your warriors will take care of the rabble rousers and the rest for you.
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17th September 2012 at 5:22 pm
sharonsj says:
The U.S. is supposed to have one of the lowest percentages when it comes to spending our income on food. On the other hand, I wouldn’t say that what we buy in the supermarkets is exactly food….
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17th September 2012 at 6:21 pm
SSS says:
“I wouldn’t say that what we buy in the supermarkets is exactly food….”
sharonsj
Strongly disagree. There are tons of choices in our supermarkets. Tons.
Plenty of fresh fruits and vegetables, many or which are labeled organic, if that’s what you want. On a low sodium diet? Again, plenty of choices. How about Kosher or Mexican or Oriental? Yep, special sections or aisles just for that type of food. Bulk purchases at low prices? Costco.
I could go on. Perhaps you need to provide us with your definition of what exactly you think food is.
Hot debate. What do you think?
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17th September 2012 at 7:11 pm
Llpoh says:
SSS – she said ” what we buy”, not what is sold. And if you look at folks waddling around, I think she is right.
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17th September 2012 at 7:21 pm
SSS says:
Llpoh
Ok, you’re right.
I took her comments as an attack on the supermarket retailers of America, which have extremely low profit margins, yet manage to provide a wonderful variety of choices to the American consumer. I’ve shopped in many supermarkets in admittedly well-off districts in Latin America. They all look like your local Safeway or Giant. So, we’re doing SOMETHING right and are extremely blessed as a nation to have these businesses up and running well.
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17th September 2012 at 8:54 pm
llpoh says:
SSS – absolutely. People take for granted the bounty around them. Too bad that that they do not use what is on offer.
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17th September 2012 at 9:22 pm
Hope@ZeroKelvin says:
Bernanke has just tossed a match into supertanker of gasoline with his QE to infinity, which will help the banksters buy more toxic debt but will drive food prices to infinity.
Nations go to war when their people are hungry and their currency is shit, yes, I know that describes the US, but it is infinitely worse in nations where people live on $2/day and their currency is tied to the USD.
(For the record,Romney opposed QE3 and wants to fire The Bernank.)
A few more false flags, like this killing of our ambassador in Libya, perhaps the conflict brewing between Japan and China, and I dunno, another attack on our economic system like 9/2008, well WW3.
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17th September 2012 at 9:28 pm
Ron says:
I enjoy the supermarket and think someday we well look back with growling stomachs at how good things were.
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17th September 2012 at 11:05 pm
DaveL says:
Well, you can now rest assured that hungry people and Admin’s FSA will not be voting for Romney.
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17th September 2012 at 11:50 pm
Ron says:
Dave,it depends who’s watch the crap hits the fan on. If Obama is as big an egomaniac that i think he is,he wont leave office. Marcos declared martial law and was there for?over thirty years?
With the congress we have and the people who really run the country,i see no difference between them.It is a pleasant thought for a moment to think Romney would make things better.
Geez who would want the job? its a headache to say the least.
And as im getting to used to saying,were screwed.
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17th September 2012 at 1:36 am
DaveL says:
Ron, to me, the only thing Romney brings to the table is the possibility that he could push things for the better. I see no fucking possibility that things will improve under Obama.
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17th September 2012 at 12:19 pm