SPDR S&P 500 (SPY)

[jbsliverer]

Keep an eye on the commodities charts. Have made pretty good buck on some of those. It was being said that things like wheat prices were peaking, going to stabilize and market priced in. Those opinions are changing and now looking for those prices to continue upward and continue inflationary pressures due to supply and demand issues.

No matter how much some want to push that it's not, we are a world economy, and things that happen in other parts of the world can have devastating effects in our little world. Can't change very quickly what has been created over generations.

World wide climate change is real and very high on my list of things to be watching. Generations of ignorance, non beliefs, and the forces to hide those facts are real also. The effects of extreme heat, cold, drought, and weather events that are becoming less and less "rare", are very real and will become more real in the market and our economic stability.
These things are going to have effect in the markets short, medium, and long term. The costs to all of our financial worth will be effected. We are going to see very shortly more and more of what they probably call "black swan" (although can be very expected) events that are created by climate extremes.

What the Fed is doing with interest rates may be considered "normal", but we are not in normal times, "normal" is changing not for the better. No interest increase is going to deal with Mother Nature. No "demand destruction" is going to happen when there isn't enough supply for even the minimum of demand.

Too much heat, cold, extreme weather, lack of water and fertilizer will be lowering a lot of yields, even effect employment. Lack of wheat or corn supply and it's effect of pricing is not going to stop the hunger to eat it, livestock needing feed, needs for paper down to gel caps for prescriptions, or loss of jobs at the cannery. Won't stop the basic demand, only high costs and ability to satisfy the demand.

Problems will expand out to pressures on other supply. Housing, material, labor, and energy for a few examples. They already are, but we haven't seen nothing yet.

With the environmental and supply issues, company's share prices that are stated to be solid and "good buys" right now with lower than "normal" PEs have not priced in the upcoming expenditures and lower profits that will have to happen.

The list is long, and there are many issues that can't be fixed by the Fed and some that can't be fixed at all. Gloom and doom? Maybe, but just realities. How we deal with these realities will be the key to any recovery.

No matter how we deal with the "perfect storm" that is happening, the market will be worth less in the near future, at least in the next yr or two, but I believe that it will be longer. I can't really see our society today dealing with these issues on a necessary "team" basis. That alone will incur higher expense to most and inefficiencies, taking even longer for any recovery.





ASIA ECONOMY
India bans wheat exports to try and tame prices as a scorching heatwave curtailed output
PUBLISHED FRI, MAY 13 202211:08 PM EDTUPDATED AN HOUR AGO
Reuters
https://www.cnbc.com/2022/05/14/india-blocks-all-wheat-exports-with-immediate-effect.html
KEY POINTS
India has prohibited wheat exports, the government said in a notification late on Friday.
The world’s second-biggest wheat producer is trying to calm local prices.
Global buyers were banking on the world’s second-biggest wheat producer for supplies after exports from the Black Sea region plunged following Russia’s invasion of Ukraine in late February.

Wheat sacks at a Punjab Grains Procurement Corp. facility in the Ludhiana district of Punjab, India, on Sunday, May 1, 2022.
A blistering heat wave has scorched what fields in India, reducing yields in the second-biggest grower and damping expectations for exports that the world is relying on to alleviate a global shortage. Photographer: T. Narayan/Bloomber

India, the world’s second-biggest wheat producer, has blocked all exports of the grain with immediate effect.
Bloomberg | Bloomberg | Getty Images
India banned wheat exports on Saturday, just days after saying it was targeting record shipments this year, as a scorching heatwave curtailed output and local prices hit an all-time high amid strong export demand.

The government said it would still allow exports for letters of credit that have already been issued and on the request from countries that are trying “to meet their food security needs.”

Global buyers were banking on the world’s second-biggest wheat producer for supplies after exports from the Black Sea region plunged following Russia’s invasion of Ukraine in late February. Prior to the ban, India was targeting to ship out a record 10 million tonnes this year.

The Indian ban could drive up global prices to new peaks and hit poor consumers in Asia and Africa.

“The ban is shocking,” a Mumbai-based dealer with a global trading firm said. “We were expecting curbs on exports after 2-3 months, but seems inflation numbers changed government’s mind.”

Global wheat prices since Russia invaded Ukraine
Chart

Rising food and energy prices pushed India’s annual retail inflation up towards an eight-year high in April, strengthening economists’ view that the central bank would have to raise interest rates more aggressively to curb prices.

Wheat prices in India have risen to a record high, in some spot markets to as high as 25,000 rupees ($322.71) per metric ton, versus the government’s fixed minimum support price of 20,150 rupees.

Heat wave shrinks crop
Earlier this week, India outlined its record export target for the 2022/23 fiscal year that started on April 1, adding it would send trade delegations to countries such as Morocco, Tunisia, Indonesia and the Philippines to explore ways to further boost shipments.

But a sharp and sudden rise in temperatures in mid-March means the crop size could be smaller than expected at around 100 million tonnes or even lower, a New Delhi-based dealer with a global trading firm said, versus a government estimate for an all-time high of 111.32 million tonnes.

Read more
India’s record-setting heat wave in pictures

“The government’s procurement has fallen more than 50%. Spot markets are getting far lower supplies than last year. All these things are indicating lower crop,” the dealer said.

In April, India exported a record 1.4 million tonnes of wheat and deals were already signed to export around 1.5 million tonnes in May.

“Indian ban will lift global wheat prices. Right now there is no big supplier in the market,” the second dealer said.
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