U.S. Inflation to Appear Next in Food and Agriculture

Fri Oct 30, 2009 12:40pm EDT

* Reuters is not responsible for the content in this press release.

FORT LEE, N.J., Oct. 30 /PRNewswire/ -- The National Inflation Association
today released the following statement to its http://inflation.us members:

"While most mainstream economists such as Nouriel Roubini are warning of
deflationary threats to the U.S. economy, it is our belief that massive price
inflation has already begun. The Federal Reserve's policy of massive monetary
inflation in 2009 has caused the Dow Jones to bounce over 50% from its low,
oil to rise 100% from its low, and gold to surge to a new all time nominal
high. One NIA co-founder just saw his health insurance premium rise 16% over a
year ago; and the average tuition for a four-year public college increased
this year by 6.5%.

Prices are rising all around us, yet agricultural commodities have for the
most part been left behind and remain at historically depressed levels.
Fundamentals for agriculture are improving on a daily basis. A worldwide
shortage of farmers combined with food inventories falling to record lows is
setting up the perfect storm for an explosion in agriculture prices. There is
a huge opportunity today to invest at the ground-floor into what will likely
be one of the biggest boom industries of the next several decades.

Wheat is currently down 60% from its all time nominal high set in 2008 and 80%
from its inflation adjusted high set in the 1970s. Corn is currently down 50%
from its all time nominal high set in 2008 and 75% from its inflation adjusted
high set in the 1970s. Wheat and corn have only bounced 13% and 26% from their
52-week lows this year respectively. While sugar has faired much better and is
now at a 28-year nominal high, sugar is still down 70% from its inflation
adjusted high set in the 1970s.

With crude oil back above $80 per barrel, we will soon see a renewed interest
in alternative energy. This will create increased demand for wheat, corn and
sugar which are used to make ethanol and other biofuels. A massive rise in
agriculture prices is just around the corner.

We receive countless emails on a weekly basis asking about if Real Estate is
now a good investment and if rents will likely climb during hyperinflation.
While rents will increase nominally during hyperinflation, they will plummet
compared to agriculture. No longer will Americans eat more than most other
countries, yet spend less of their income on food. When Americans are forced
to pay more for food, it will take away from what they can spend on rent.

The average American consumer today spends approximately 30% of their income
on housing and only 10% of their income on food. We expect these numbers to
reverse in the years ahead as the U.S. dollar loses its purchasing power. In
Germany during hyperinflation, rents fell from 30% to less than 1% of the
average households' expenditures while food rose from 30% to a high of over
91%.

The U.S. is currently the world's largest exporter of wheat and corn and the
fifth largest exporter of sugar. When American consumers purchase food at
their local supermarket, they are competing against consumers from all around
the globe. As the Federal Reserve prints trillions of dollars out of thin air
and causes our currency to lose its purchasing power, Americans won't be able
to afford to eat as much and farmers will be forced to increase their exports
to countries with stronger currencies.

When it comes to an apartment in the U.S. that a landlord is trying to rent to
a tenant, there is no global market to drive rent prices up. The rents
landlords receive depend on the strength of the local U.S. economy. With
unemployment continuing to surge and a huge glut of homes on the market, it is
only a matter of time before real rent prices decline and become a smaller
monthly expense than food.

While Americans will eat less in the years ahead, Chinese citizens will be
able to afford to eat more. Despite China's rapidly growing economy, there are
major food shortages in China. Chinese agriculture companies have a chance of
becoming the market's biggest gainers of the next decade. Our last China
agriculture stock suggestion gained over 83% after our profile in a little
more than six months. We will be announcing our new China agriculture stock
suggestion on Tuesday."

Please spread the word about NIA and have your friends subscribe for free at
http://inflation.us

About us: 
The National Inflation Association is an organization that is dedicated to
preparing Americans for hyperinflation. The NIA offers free membership at
http://www.inflation.us and provides its members with articles about the
economy and inflation, news stories, important charts not shown by the
mainstream media; YouTube videos featuring Jim Rogers, Marc Faber, Ron Paul,
Peter Schiff, and others; and profiles of gold, silver, and agriculture
companies that we believe could prosper in an inflationary environment.

    Contact:
    Staff
    Editor@inflation.us
    1888-99-NIA US



SOURCE  National Inflation Association

National Inflation Association Staff, +1-888-99-NIA US, Editor@inflation.us
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