Letter Re: Why Food Prices are Soaring

Jim
I enjoy your books (have bought two for others as gifts) and blog site. I came across this article [from Canada] describing another unintended consequence of the extreme liquidity the Fed is using to prop up our housing market/economy- high food prices. Aside from the new ‘miracle’ fuel – ethanol – our government policies are eroding our purchasing power in every sector of our lives. Here is an excerpt from the article:
“After steamrolling through a laundry list of base metals, then oil and gas, the global commodity boom is finally hitting us in the gut: at the supermarket checkout counter.
Canadians paid 3.8% more for food in April compared with a year earlier, including an extra 12.9% for fresh vegetables. The experts have coined a new term to describe the phenomenon. They call it agflation, and they blame the hedge funds.
The examples are everywhere. Global milk prices are rising at the fastest rate ever. Powdered milk, a key benchmark, has jumped 60% in six months to US $1.58 at the beginning of May. Since 2000, beef prices have jumped nearly 30% on the Chicago Mercantile Exchange.” The article is pretty enlightening.

Thanks for your vigilance and willingness to educate. – John in Virginia