March 9, 2009 are farmers stupid or brilliant?
All of my 3 readers know how I love to talk about the economy, so here is your warning….I am about to talk and try to force you to think like me about the reasons why the stock market is down and the world is in a recession as of Feb 09 and why we need only to watch the ant… without sounding condescending, the farmer.
Economists we follow: Gietner, Paulson, Bernanke, Summers, Greenspan, Volker, Godfather of Capitalism Friedman, A.Hamliton, A.Smith ….”careful not to step on all the names dropped.” Niles Crane ~ Fraiser hahahha…. sorry A.D.D. kicking in….
Economists I say to follow: Your favorite farmer, fisherman, miner, or forester.
WTF? Farmer??? Like a Corn Farmer? Get that corn out of my face!
OK. I might be crazy, but yes, people who dont live in LA or NY are very wise. I feel a farmer is wiser than all of those other economists combined. Serious. Lets think about the farmer and what he knows about principles and how NYC missed that wisdom.
Farmer knows best.
God gave us the earth to receive goodies and daisies through Farming, Forestry, Fishing, and Mining. These are called primary producers. Now remember, everything we as employees do, that are not farmers, are built on these producers, hence “non-farm payroll.” Think about it. EVERYTHING from Wall Street to Circuit City is layered on top of primary producers. For example:
- 01A Iowa farmer plants corn seeds, then harvests the corn, and the corn is sold at a general store.
- 02The general store is started by an entrepreneur :) that sells the corn and receives a $ margin on the corn. The margin of the corn sale pays the shop keeper a wage. He uses this wage to buy a Coke.
- 03These Coke sales improves the value of the Coke stock price. Now, in New York, students are going to school to become stock brokers.
- 04These brokers convince people in California that Coca-Cola is a good investment. Stock brokers make a margin on the sale of Coke stock.
- 05Stock brokers use that margin to lets say… buy corn at Zabars in Manhattan for $6.98! Yickes!!!
And on and on and on….so the foundation of the economy is built on Farming, Forestry, Fishing, and Mining.
Principle: Harvest what you sow.
Farmers have learned over the years that you harvest what you sow. So when farmers put too much seed in the ground or they over water their crop or take the easy way out, not work hard, sleep in, cheat, not harvest at the right time, their crop yield is terrible. So the principle is, if you are honest with what you have been given (land/soil), put the correct amount of care, seed, water, time, sunlight, etc. you will yield an expected crop.
Summary: Greed stepped on the ant
AIG, Bear Sterns, Lehmann Bros are harvesting what they sowed. They sowed FAKE crops. Just vapor, or what they call “leverage.” The “Street” over-watered vapor, there was no sale of a crop, such as… AIG just sold “insurance on leverage.” WTF IS THAT? No crop, nothing to hold in your hand….sold it over and over and over again. They sold $ billions $ of stock of, yes… nothing. These billions of dollars of stock are tied to billions of dollars of other billions of dollars. So, when the principle of harvest what you sow came knocking, it had to collapse.
So why oh why did no-one that knew to “watch the ant” stop the insanity?!? Ah….the power of greed over principle.