changing of the guard

As we move from one sectorial boom to another (ie metals to agriculture) it is a signal of the broader changes in a resource constrained global economy. Whether you understand it or not, we are moving from a wants based to a needs based economy. We don't need metal (flat screeens, cars, cheap Chinese cr#p etc) as much as we need food and fibre (food and fibre).

We will move from consuming such a large percentage of our disposable incomes on Chinese goods to one spent more on developed world goods, namely food and fibre. Its hard to come to terms with because two generations have never had to worry about food supplies, but what lies ahead is a tremendous sustained leap in food prices. I'll go out on a limb and make a prediction. Up to 40% of disposable incomes for an average Australian family will go on feeding and clothing it within 5 years. And this will not be an Australian based phenomena.

Now tell me I am bonkers to not have every investable penny I have invested in AGRICULTURE.