The Global Food Economy: Peak Food, Social Unrest, And Bailed-Out Credit-Junkies

January 8, 2013

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Source: Zero Hedge

Beginning with Malthus' warning to the world and the Great Irish famine, David McWilliams (of Punk Economics) provides his typically succinct, profoundly fascinating, and graphically pleasing insights on the state of the global food economy. "What happens when hungry people panic?" is the question McWilliams poses; "they move to other parts of the world," he rhetorically answers, adding that this could well be the story of the next 50 years on Earth as the rock of the insatiable demand of seven billion (soon-to-be-ten-billion) people smashes into the hard place of the planet's limited resources to produce that one thing that keeps us all alive - food. The food dilemma is more complex though as it is really an energy dilemma - one that is not going away (on the downside). On the bright side, Malthus' nightmare has yet to occur thanks to the ingenuity of humans. However, if all the world's seven billion people consumer as much as the average American, it would require the resources of over five planet Earths to sustainably support all of us. So either the rest-of-the-world eats less to allow Americans to eat more or we are stuck! But it's not just how much we eat, but what we eat...

In fact the change in diet of the Chinese and Indian and Brazilian populations is one of the biggest undocumented stories of globalization - driving up food prices dramatically and punishing the poorer nations (not to mention the inexorable currency devaluations that Central Bankers are slooshing unintendedly to these nations capital markets)

Furthermore, McWilliams rightly ties social unrest to these dramatic food price rises... must watch!

Food is politics and Politics is food...

As the world's diet changes, with a preference for meat and dairy - so energy requirements surge...

MMcWilliams ties a beautiful bow on the presentation bringing the need for the water and therefore the need for oil (energy to grow, clean, and transport).

In short the single-biggest driver of the price of food is the price of oil, so as we hit Peak Oil, are we also hitting Peak Food - and if so, what is next?

and then at around 8:15 McWilliams ties in the 'frothy response' of the world's central banks to the global financial crisis plays its part...

The process of bailing out credit junkies in the rich world is driving up the price of survival in the poor world.

In the west, the poor are getting fatter and the rich are getting thinner (as food is becoming a class issue)...and that is leading to dramatic shifts in health costs...

This is where the Food challenge of the next 30 years is taking us... A roller-coaster where Finance and Ecology meets Economics, Demography, and Politics and the outcome is the 'very survival - and progression - of humanity'...

in a world where billions of people want what you have and might be prepared to do anything politically, militarily, or financially to achieve this...