And Bernanke confirmed earlier this week that Massive QE would continue by stating that QE3 was “on the table”, thus supporting a continuing “Risk-On” Rally.
But this QE will have Profoundly Damaging and Risk-Creating and Wealth Destroying Effects. President Reagan’s Budget Director, David Stockman, correctly called it “Monetary Heroin”.
Nevertheless, it will also provide Great Opportunities for Wealth Acquisition, as we explain.
Notwithstanding Cartel (Note 2) Price Suppression, Gold and Silver have unquestionably been the best performing Asset Class in the last decade assuming wealth protection and Profit are the Goals. And they will continue to be.
But there is another Asset Class which will almost certainly Outperform as we enter into the Hyperstagflationary Era. (See Deepcaster’s “Gaining From The Inflation/Deflation Conundrum” – 12/15/2011 in ‘Articles by Deepcaster Cache’ at deepcaster.com).
That class is Agricultural Products.
Why?
The bulk of the 80 Million / Year World Population Increase Occurs in Emerging Market Countries such as the BRICS.
Generally these Emerging Markets have an emerging Middle Class with the economic wherewithal to buy more and better food.
Clearly, Food is the first Priority of all People.
But as the excerpt above shows, even though Supply is increasing, the Demand generated by the 80 Million / Year population increase, is outstripping supplies.
In sum, demand is exceeding supply and given Demographic and Agricultural Production Realities, will continue to do so. Much of the world’s best arable land is already in production, and modern Agriculture is very energy intensive and especially Reliant on Portable fuels like Crude Oil.
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