Food crisis or opportunity? (05/11/2013)
Roger Montgomery is the Founder and Chairman of Montgomery Investment Management. Roger has over three decades of experience in funds management and related activities, including equities analysis, equity and derivatives strategy, trading and stockbroking. Prior to establishing Montgomery, Roger held positions at Ord Minnett Jardine Fleming, BT (Australia) Limited and Merrill Lynch.
This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.
Archie Archbold
:
Re: Food security & the sale of Graincorp. I have a rather simple query that I’m having difficulty finding an answer to. Perhaps you can help, Roger.
I have read that the US (and other countries with a fiat currency) can “print” / create dollars and lend it to companies at near 0% interest. The company can then buy real / hard assets such as Graincorp thereby converting “free” money into tangible assets. Can you please explain why this cannot occur and why is not something to be concerned about?
I’m sure this is an old chestnut which has been dealt with many times before. Perhaps you can direct me to a source of information. With thanks in advance.
Roger Montgomery
:
Hi Archie,
We recently wrote a piece about Bubbles and referred to teh Fed. You might like to read it next week and then contemplate what it means for asset prices…
Robert Judd
:
Does it follow then that if food sources become scarce or consolidated into large conglomerates that the food retailers may start to acquire food producers to feed their own brands?
Roger Montgomery
:
Vertical integration in some sectors may occur to secure supplies one day but right now the return on equity of the producers has been screwed to very little so the retailers would look over and ask what for?