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Food as the next bubble

Resilience Science has a rather interesting piece on investment banks and the like investing in food. Not only for the purpose of commodity speculation, but also in infrastructure. Not surprisingly, much of this investment is taking place in Africa: small holders are being bought out, or forced out, and vast estates are being consolidated. It has all the trappings of being v2.0 of the Green Revolution. Obviously this has all the trappings of being a Very Bad Thing. Besides this, it seems that this effort is in response to the declining profitability of mortgage backed securities, and it wouldn’t surprise me if we see a sort of financialization of food profits, with mark to market efforts and securitization of crop yields.

As the RS piece notes, effects are likely to be ‘unexpected’ and ‘novel’. That is shorthand for ‘unintended’ and ‘devastating’, if the history of like efforts is any indication.

Categories: Asides.

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3 Responses

  1. Not to mention the commodification of water. Joy.

    occassia6 June, 2008 @ 3:48 pmReply
  2. Well, if the money value of basic commodities can be inflated, then the deflation of the housing bubble might not cause so many of the wealthy so much pain. At least, not immediately.

  3. Let’s dance, that is!



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