benign.neglect
Moderator
I live in the rural south. The economy here is agriculturally based. I have yet to see a problem with the local economy.
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Carbon Credits, Whats in store, England Now USA soon
- Thread starter Master Blaster
- Start date
I live in the rural south. The economy here is agriculturally based. I have yet to see a problem with the local economy.
Farmers set the prices, the same as shoppers at the grocery do.
First, you will sell to the elevator/feed lot/packing house that is offering the most money. If none of them do, you grow a different crop, or take other measures. That has an effect on prices. For example, lets say that the elevators are not offering enough for corn. A few farmers stop growing corn, this lowers the available supply. Each elevator is responsible to their customers and needs to supply them with corn. This starts a bidding war amongst them for the corn that is available.
The same with oil. There are a few pressures here. First is the supplier. OPEC manipulates the market by limiting supply. The US limits drilling for environmental reasons. The cold winter limits Russia's drilling. Iraq is producing effectively nothing. All of these factors reduce supply.
Then, China has QUADRUPLED their use in the last 5 years. That, along with increases in other developing nations like India and Pakistan, increases demand.
Speculators, attempting to stay ahead of the curve, are trying to buy and hold oil in an attempt to make money off of the rising prices. The speculators are- us. Our retirement funds. Our mutual funds. Other investment houses.
Add in the fact that governments further manipulate the market with taxes and fees, and you see that this is going to get worse, not better, with government interference. Nationalization, which at least one official has proposed, will also do more harm than good, for a host of reasons that will make this post even longer.
First, you will sell to the elevator/feed lot/packing house that is offering the most money. If none of them do, you grow a different crop, or take other measures. That has an effect on prices. For example, lets say that the elevators are not offering enough for corn. A few farmers stop growing corn, this lowers the available supply. Each elevator is responsible to their customers and needs to supply them with corn. This starts a bidding war amongst them for the corn that is available.
The same with oil. There are a few pressures here. First is the supplier. OPEC manipulates the market by limiting supply. The US limits drilling for environmental reasons. The cold winter limits Russia's drilling. Iraq is producing effectively nothing. All of these factors reduce supply.
Then, China has QUADRUPLED their use in the last 5 years. That, along with increases in other developing nations like India and Pakistan, increases demand.
Speculators, attempting to stay ahead of the curve, are trying to buy and hold oil in an attempt to make money off of the rising prices. The speculators are- us. Our retirement funds. Our mutual funds. Other investment houses.
Add in the fact that governments further manipulate the market with taxes and fees, and you see that this is going to get worse, not better, with government interference. Nationalization, which at least one official has proposed, will also do more harm than good, for a host of reasons that will make this post even longer.
If the supply of corn for food increases, the price will drop. If the supply of corn for food is suddenly used for ethanol, the supply of food corn decreases and the price increases.
Example:
100 ears of corn previously went only for food at $.20 per ear.
False ethanol demand created by Senators makes two markets for corn
Farmers start using corn for ethanol
50 ears go to food
50 ears go to ethanol
Sounds good right? Nothing has changed?
WRONG!
There's still the demand for 100 ears of corn on the food market. So what has happened? The supply of corn for food has decreased, has become more rare, the price went up to $.40 per ear.
Corn is used for feed for cattle. Price of corn doubled, it now costs twice as much to feed a cattle. Beef and milk prices go up.
Rice and wheat farmers got into the corn business. Still not enough corn for everybody, but now there are less farmers growing rice and wheat, so those prices go up as well. The price of bread (and beer) increases because there is less wheat.
Farmers don't set the prices, the market sets the prices. The farmers can set the price at $2 per ear, but the market won't bear the price. I sure wouldn't pay $2 per ear, just like I refused to pay $3.99/lb yesterday for red bell peppers at the grocery.
Red bell peppers I can live without. Gas I cannot. I can't get to work without gas.
I drive a Mazda3, one of the most fuel efficient COMPACT cars on the road (26mpg city, 31mpg highway). If cost $45 do fill it this morning. It's not just SUV drivers suffering.
The problem with liberals is they believe everything is solved by throwing more money at it. It's a fallacy which needs to be destroyed.
Example:
100 ears of corn previously went only for food at $.20 per ear.
False ethanol demand created by Senators makes two markets for corn
Farmers start using corn for ethanol
50 ears go to food
50 ears go to ethanol
Sounds good right? Nothing has changed?
WRONG!
There's still the demand for 100 ears of corn on the food market. So what has happened? The supply of corn for food has decreased, has become more rare, the price went up to $.40 per ear.
Corn is used for feed for cattle. Price of corn doubled, it now costs twice as much to feed a cattle. Beef and milk prices go up.
Rice and wheat farmers got into the corn business. Still not enough corn for everybody, but now there are less farmers growing rice and wheat, so those prices go up as well. The price of bread (and beer) increases because there is less wheat.
Farmers don't set the prices, the market sets the prices. The farmers can set the price at $2 per ear, but the market won't bear the price. I sure wouldn't pay $2 per ear, just like I refused to pay $3.99/lb yesterday for red bell peppers at the grocery.
Red bell peppers I can live without. Gas I cannot. I can't get to work without gas.
I drive a Mazda3, one of the most fuel efficient COMPACT cars on the road (26mpg city, 31mpg highway). If cost $45 do fill it this morning. It's not just SUV drivers suffering.
The problem with liberals is they believe everything is solved by throwing more money at it. It's a fallacy which needs to be destroyed.
Divemedic normally I think your posts are well thought out and informative.
But this drivel is probably the most simplisitc and far below your normal level of thought I suspect someone else wrote it.
Grow a different crop, how long do you think it takes to grow a crop. Change crops, I wish it was that easy, farm machinery is not cheap and to grow any substaintal amount of crops takes specialized attachments to tractors and such. Growing corn is not the same as growing wheat, growing wheat is not the same as growing soybeans.
Sometimes you have to sell your crop for the price the eleveators are buying, to truck it somewhere else, even if you could find one at a better price would be cost prohibitive.
Just get the goverment out of farmers and other businesses ways and watch out, it would be the 1950s all over again. Prosperity like you would not believe.
First, you will sell to the elevator/feed lot/packing house that is offering the most money. If none of them do, you grow a different crop, or take other measures. That has an effect on prices. For example, lets say that the elevators are not offering enough for corn. A few farmers stop growing corn, this lowers the available supply. Each elevator is responsible to their customers and needs to supply them with corn. This starts a bidding war amongst them for the corn that is available.
But this drivel is probably the most simplisitc and far below your normal level of thought I suspect someone else wrote it.
Grow a different crop, how long do you think it takes to grow a crop. Change crops, I wish it was that easy, farm machinery is not cheap and to grow any substaintal amount of crops takes specialized attachments to tractors and such. Growing corn is not the same as growing wheat, growing wheat is not the same as growing soybeans.
Sometimes you have to sell your crop for the price the eleveators are buying, to truck it somewhere else, even if you could find one at a better price would be cost prohibitive.
Just get the goverment out of farmers and other businesses ways and watch out, it would be the 1950s all over again. Prosperity like you would not believe.
Master Blaster
New member
I live in the rural south. The economy here is agriculturally based. I have yet to see a problem with the local economy.
But you are not a farmer, are you?
Folks who have never run a small family business have no idea what the small businessman faces. Farmers have the added problem that the product they produce is perrishable, and may not be economical to transport over long distances, and must be sold when it is harvested so they cant wait for the price to go up. The free market does work but it takes time for that to happen. The farmer grows his corn and has to borrow money from the bank for his seed, fertilizer, equipment, labor. The Bank expects to get paid back by X date. The farmer has overhead (fixed costs that cant be avoided even if no output is produced) If the price falls or stays the same over the three month period from planting to harvest the bank does not care they want payment at the end of the three months. A five or 10% drop in the price may mean the farmer makes no profit to feed his family, or it could mean he defaults on the loans. There is always some supply in the pipeline ( canne corn, processed feed, alcohol already made) so the price may not change as fast as the farmer's costs do. The price may go up for next years season due to a shortage at the end of the season this year, but the farmer already has his corn to sell and his bills to pay before that happens.
If he fails to pay his bills this year he will not be in business to take advantage of the price increase next year.
Just get the goverment out of farmers and other businesses ways and watch out, it would be the 1950s all over again. Prosperity like you would not believe.
Amen! And we wouldn't have wasted $300 BILLION on farm subsidies this week. Just another way to buy votes and make people reliant on government instead of prospering on their own.
Northern Sod Breaker
New member
Just get the goverment out of farmers and other businesses ways and watch out, it would be the 1950s all over again. Prosperity like you would not believe.
+1 or is that 2 now?
But back on topic.
As has been shown a higher price of fuel will only serve to hurt those who depend on it.
As for the original topic of carbon credits. These schemes always assume that everyone has the same basic needs as a human. This could not be farther from the truth. A family is going to reguire more energy then a single person. A small business owner is going to require a certian amount of energy. Too often we over look the small business owners and assume that all companies are huge corperations. or we assume that a company that grosses less then $100K a year is some how less legitimate as a company. They use energy just the same. Just becuase it is a sole proprietor with no board of directors does not mean we should spite them. And I'm not just talking about the obviuos here. What about the barber that cuts your hair? Did it occur to anyone he still has to heat his shop. Or your car mechanic. They all use more energy then someone who is just cashing their payroll and feeding his/her family. And these are the ones who are going to be hurt by carbon credits or as mentioned in the OP a set number of them.
Should this scheme become law small businesses would have to prove they are a business (What happened to free enterprise?) and jump through a whole bunch of loops to get the exemptions, if there even are exemptions, which means the govt. would have better tabs on that 15 year old who mows lawns. and thus taxes could be better collected and then we realise what Global Warming/Climate Change is realy about. And that is money. And in truth this would not be the first time the govt. used fear to line it's pockets. Just like the NAIS and "Mad Cow" was going to kill us all so we have to mandate a govt registry to protect ourselves. And pay the govt. for the service.
The fact of the matter is that. The Govt. will always seek to line it's pockets. And there will always be those who are willing to whore themselves out to the idea. In addition there will always be innocent people who are deceived into believing that it is for their benefit.
benign.neglect
Moderator
But you are not a farmer, are you?
My father farms full time, I have a small part time farm.
You are off base.
They sky is not falling.
But this drivel is probably the most simplisitc and far below your normal level of thought I suspect someone else wrote it.
I will grant you that the example I gave was greatly simplified, but people frequently have a problem understanding the way market forces work. I am trying to illustrate that there is no mysterious "market" that sets prices. The market is a sum of all the players in the chain.
What if the elevators offered you 10% of what they offered yesterday? Would you continue to sell at that price, or would you find another way to use or sell that corn? Perhaps even switch?
It is the same throughout the market. If the medical field were to announce that they were cutting the pay for people in my profession, I would begin career training next week. Granted, it is as difficult for me to change careers as it is for you to change crops. That is why we have relative stability in the market. Only through major interference or upheaval is major change made.
I agree- in all levels of the economy, the governement is the major cause or problems.