What is happened to our cattle prices???
- Thread starter mtrancher
- Start date
agman said:
http://72.14.203.104/search?q=cache:OWou8BTy1ccJ:www.nfu.ca/briefs/National%2520Farmers%2520Union%2520brief%2520to%2520Alberta%2520Government%2520Decembe.pdf+BSE+Border+closed+higher+retail+prices+beef&hl=en&gl=ca&ct=clnk&cd=26
~SH [quote said:
ONLY BECAUSE CANADA SUDDENLY FOUND THEMSELVES WITH MORE CATTLE THAN SLAUGHTER CAPACITY. That is not a normal supply and demand situation because Canada historically relied on the U.S. to slaughter a large percentage of those cattle. When packers were making money in Canada, they were closing down plants and losing more than enough money to offset it in the U.S. That is a fact!
Due to the costs of SRM removal, Canadian packers weren't making as big of profits as many of you believe. There was actually a quarter when Tyson's Lakeside plant lost money when the border was closed.
You guys don't know what your talking about when it comes to packer profitabilty.
~SH~[/quote]
Well when they refused to open their books and decided to pay the daily or monthly fine instead they sure looked guilty.
DiamondSCattleCo said:
Rod if you go by average it was 10% drop retail, although the slaughter steers where down by 58 per cent.
Here is a TD link http://www.td.com/economics/special/madcow04.jsp
But here is another link that says retail prices went higher.
http://72.14.203.104/search?q=cache:OWou8BTy1ccJ:www.nfu.ca/briefs/National%2520Farmers%2520Union%2520brief%2520to%2520Alberta%2520Government%2520Decembe.pdf+BSE+Border+closed+higher+retail+prices+beef&hl=en&gl=ca&ct=clnk&cd=26
I do know one thing. Except for guys selling there own beef and bypassing the packers<think in truck in a parking lot> What I seen in the stores was higher prices. All everybody was talking about here on the news on the radio and in the newspapers was about how the retail prices were either staying the same or going up!
T3023 said:
After reading this......
How can you say we are fighting a "War" on Terrorism when they are opening the gates on everything.
lOOK right now America is the global economy. The UN dont mean shirt. What in the heck can they do to you? Kick your ash? I dont think so.
You need a global economy. If you didnt trade with onther nations your economy would collapse. You certainly would never come even close to meeting your energy requirements.
Most of your National dept is actually just borrowed out of your old age security funds. Even Saddam Hussein was stock pileing American dollars!
I can spend American money in any part of the world. Try doing that with Canadian money.
Look why do they put trade restrictions on nations they dont like? Think South Africa, Iraq, etc.
Welll.............
Your free to do as you please. But I am not tagging my beef, goats, dogs, horses period. There not going to put a meter on my well. You will be able to spend your american dollars for a while....
But what about your children and your childrens children.....
maybe their not what matters now...... what about tomorrow and the next generation. The only thing that backs the American dollar is oil. Why do you think they don't want to tap our reserves and so they buy from everyone else. Cattle and your American herds and crops "DO NOT" back your dollar.
If this is how you believe things really are and how they will continue to be then don't worry about it because you are where you want to be. I am just putting out the information so others will be informed / educated so they can excerise their american freedoms, because we are going to loose them if we don't say something.
:twisted:
Your free to do as you please. But I am not tagging my beef, goats, dogs, horses period. There not going to put a meter on my well. You will be able to spend your american dollars for a while....
But what about your children and your childrens children.....
maybe their not what matters now...... what about tomorrow and the next generation. The only thing that backs the American dollar is oil. Why do you think they don't want to tap our reserves and so they buy from everyone else. Cattle and your American herds and crops "DO NOT" back your dollar.
If this is how you believe things really are and how they will continue to be then don't worry about it because you are where you want to be. I am just putting out the information so others will be informed / educated so they can excerise their american freedoms, because we are going to loose them if we don't say something.
:twisted:
DiamondSCattleCo
Well-known member
RoperAB said:
Yep, CanFax retail prices were statistically weighted to the east I think, however out west we never really saw any drops did we? Especially on high end cuts, cause you simply couldn't buy them. We ran out of beef, so my wife had to head into town to buy some. She bought the best steak she could. I had to cut it with a chainsaw.
Rod
WHAT ABOUT AFRICA?
By Joan M. Veon
The Women's International Media Group, Inc.
Since the last G8 in England seven years ago, the focus has been aid for Africa. In 1998, the churches organized the Jubilee Debt Relief Campaign. The terminology used was to remind world leaders of the Biblical Year of Jubilee recorded in the Old Testament where the debts of debtors were forgiven. I remember going to a non-governmental organization-NGO workshop where I interviewed a key leader about his proposal for global taxation. I asked him what they were going to do with the huge flows possible from a global tax. He told me that there would be enough for both Africa and the United Nations! Seven years later, both debt forgiveness and the concept of global taxation have come full circle. This is it. This is where the rubber meets the road.
Over the last ten years, the idea of global tax has gone through a number of revisions. Last year French President Jacques Chirac put the idea of global tax on the leader's agenda and promised concrete recommendations. His proposed "International Solidarity Levy" would levy a tax on airline tickets. I find this curious since most airlines are bankrupt. What a carrot! Countries in favor include Brazil, China, and Germany. Currently there are no international treaties that prohibit the creation of a flat tax on airline tickets since a number of airlines already have various types of taxes on airline tickets for airport renovation and the like. The rate would be personalized according to country acceptance. Revenues would be collected by the airlines and passed on to the respective country which would supplement their foreign aid funds.
Before the world commits to the French plan which has been laid on the table and is in the process of being proposed now to the leaders of the entire world at the September United Nations General Assembly, there are a number of questions that should be asked, "How come Africa had no problems while they were colonies of Britain?" and "Why has Africa been the focus of wars and revolutions since the time of de-colonization?" Complex questions have complex answers. For people seeking truth, we will take a look at the Commonwealth, World Bank loans, NSSM200, the conditions being put on Africa, and global taxation.
First, let us take a look at what the Commonwealth of Nations is all about. According to the Internet encyclopedia, Wikipedia.org, "The Commonwealth of nations is a voluntary association of independent sovereign states, mostly formed by the United Kingdom and its former colonies." Today there are counties that acknowledge the British monarch as head of state and those that only recognize the queen as Head of the Commonwealth.
The old British Empire, we are told, was dismantled after World War II beginning with India. When de-colonized, many countries became republics. The London Declaration, which provided for members to accept the British monarch as Head of the Commonwealth regardless of their domestic constitutional arrangements, is now considered by many to be the start of the modern Commonwealth.
The population of the Commonwealth is about 1.8 billion people which comprise about 30% of the world's population. India is the most populous member with a billion people while Pakistan, Bangladesh, and Nigeria have more than 100 million people. The land of Commonwealth nations equals about twenty-five percent of the world's land area.
When the UN was formed in 1945, Canada, New Zealand, and the UK had three votes. As Britain de-colonized countries, the newly de-colonized countries were made voting members of the United Nations. Between 1946-1989, a total of 42 countries were de-colonized, thus giving the Commonwealth the potential of 54 votes which includes those countries that were already independent.
Apart from the votes which the Commonwealth has at the United Nations and at other international organizations, it is important to understand that the war, genocide, and the problems of poverty did not exist in Africa before de-colonization. Interestingly enough, of the twenty countries de-colonized between 1960-1969, seven are today Highly Indebted Poor Countries. They include Ghana which is rich in gold, bauxite, manganese and diamonds; Guyana which is rich in bauxite, manganese, gold and diamonds; Uganda which is rich in copper and cobalt, Tanzania which is rich in gold, diamonds and coal and Zambia which is rich in copper.
So why are they have trouble in today's globalized world? We can go back to World Bank loans during the 1970s which were forced on a number of African countries. Under World Bank President Robert McNamara, who served as president from 1969 to 1981, World Bank economists forced their way into countries in order to come up with a financial plan for their new development. Even the president of that country was not privy to what the plan said, but was under the gun of the World Bank to take loans to carry out these grandiose projects. The idea was that the income generated from the project would provide monies to repay the loans. Unfortunately that did not happen. These are now the Highly Indebted Poor Countries which you and I are being asked to bail out through increased foreign aid, debt forgiveness, and/or international taxation. Talk about a transfer of wealth!
If this did not de-stabilize Africa, there is more devastation that they have been subjected to. Interestingly enough, it occurred AFTER de-colonization. In 1974, President Richard Nixon was presented with a study by the National Security Council which is called, "NSSM 200 - Implications of Worldwide Population Growth for U.S. Security and Overseas Interests." This 250 page report was a result of a four year study which he had requested on August 10, 1907 in National Security Decision Memorandum 76. This memorandum recommended that the U.S. propose a United Nations study of "world population problems and measures required dealing with them as a top priority in the Second Development Decade." When the study was completed in May, 1974, it was sent to Nixon along with a memo by Dr. Henry Kissinger, then National Security Advisor, in which he recommended the need for the U.S. to provide leadership "in world population matters."
NSSM200 suggested that the U.S. needed "access to minerals which are necessary for military and industrial uses and for which the U.S. must reply on imports. Where these 'strategic and critical' materials are concerned, therefore, U.S. economic stakes in the developing world coincide with military considerations" (NSSM 200). Furthermore, it points out that if the resources found in a number of Lesser Developing Countries are important to the U.S. and if those countries develop with a normal increase in population, they will have a greater need for their resources, which means the U.S. will not have access to them. In other words, it was to the advantage of the U.S. to keep these countries from developing so the U.S. could have access to them.
The report identified using foreign aid funds as a way of "helping" the leaders of targeted countries to embrace population reduction. The report placed the agenda of population reduction on the shoulders of the United Nations, non-governmental organizations, and a number of UN agencies and commissions.
The United Nations did exactly what the U.S. government told them to do. They made population reduction a key focus of their agenda through Agenda 21 and sustainable development. At the UN Conference on Population and Development in 1994 in Cairo, African women asked representatives from Planned Parenthood International why they could only get condoms and not aspirins at their health clinics.
According to the British publication, Newstateman, after more than $400B of overseas aid channeled through African governments, the African people are on the whole poorer than they were 30 years ago.
So how much does Africa owe the World Bank and the International Monetary Fund? According to John Hilary from War on Want, about $532B is owed by the 60 Highly Indebted Poor Countries. Currently only 18 countries have qualified for debt forgiveness because they have met the conditions World Bank conditions. The amount of debt forgiveness is $40B but the debt servicing of the remaining $492B is $45B a year.
The World Bank's program for Highly Indebted Poor Countries-HIPC is funded by pledges and paid-in contributions. Steps poor countries have to take to qualify for a reduction in debt include: changing their structure of government to be "more accountable", make all financial figures public (transparency), privatize their energy sector, water, electricity, etc. and work through regional blocks with other cities and states. This is regional government which is appointed, not elected officials. In order to deprive the people of the world of representative and accountable government, regional government is being super-imposed over elected officials. In the U.S. President Nixon opened the door to regional government. In addition, the people of Europe have said no to regional government.
Today what you see is the plea for business to come in and partner with African governments. The Prince of Wales International Business Leaders Forum has called for "ten practical actions to support Africa's development." One of them is, "Work with other businesses in partnership with civil society organizations to support, social, health, human development and enterprise development."
At every turn, it is public-private partnership, selling off government owned resources, or privatizing through partnering with business. This is seen in President Clinton's New Partnership for African Development-NEPAD. President Bush has set up his own initiative, the Millennium Challenge Corporation-MCC, a U.S. government corporation, to administer funds. An informational brochure handed out at the G8 described it as "an innovative new foreign assistance program designed to eliminate extreme poverty and promote sustainable economic growth." The purpose is to set up public-private partnerships-PPP. PPP's are business arrangements for governments to transfer state-owned assets to. Since it is a business arrangement, it is run by the corporate partner that has the money. As expected, there are steps that countries need to take in order to be eligible, just like the World Bank qualifications. For example, the MCC Board approved a Compact with Cape Verde for approximately $110M. The Compact will support their efforts in achieving its overall national development goal of transforming its economy from aid-dependence to sustainable, private-sector led growth."
At the 2002 UN World Summit on Sustainable Development, an international public-private partnership, "The Congo Basin Forest Partnership," was announced. It has eight African countries, six of the G8 countries, the American Forest and Paper Association, and four major environmental organizations including World Wildlife Federation as partners. Seventy-four million acres of land in Africa will be moved into this partnership! In an interview with a U.S. State Department official by colleague Joan Peros, he refused to comment on any debt-for-nature swaps!
The question that should be asked is "What will these countries have left once they privatize their state owned assets and change their form of government to meet a global structure of government?
In an interview at the G8 with an African official from an African consumers group, he voiced the same concerns. They have made it very clear to G8 leaders that they do not want any more aid with strings and privatizations.
On the other hand, as reported by the British magazine, Newstatesman, many African countries are turning to China for help. Nearly 700 Chinese companies operate in 49 African countries. Chinese trade with Africa will reach $30B next year—triple the level five years ago. By the end of 2005, according to the French paper, LeMonde, China will overtake Britain as Africa's third-largest trading partner and it is increasingly turning to Africa as a source for oil, timber, and minerals for support its phenomenal growth.
The Sierra Leone tourism board and the Chinese construction company Henan Gouji recently signed a $220M agreement for a luxury golf course and five star hotel. Their tourism minister said, "Why should we wait for Britain or anyone else to get here? The Chinese are the ones coming to invest now."
Last year, China's export bank extended a $2B line of credit to the Angolan government for infrastructure projects. In return for low interest rates and a long repayment schedule, Angola will provide China with 10,000 barrels of oil a day and award China with large construction contracts. Interestingly enough, these are the terms that the World Bank should be offering! In Sudan where the U.S. maintains partial oil sanctions, China has become that country's largest trading partner. The list goes on.
Is this a case of creating a major continental-wide problem and then solving it to get the intended result which is a grand transfer of wealth?
In conclusion, it is not only the assets of Africa which are at stake, but the whole transfer of wealth through our tax-dollars to support the "war on poverty." In an interview with French President Jacques Chirac, I asked if the proposed "International Solidarity Levy" is going to be duplicated once it is in place. He told me there are many different proposals for global tax. I would assume that if the airline tax is passed without great opposition, that it will open "Pandora's Box" to a countless number of other international taxes. Without Africa, global taxation would not be possible. So, what about Africa?
By Joan M. Veon
The Women's International Media Group, Inc.
Since the last G8 in England seven years ago, the focus has been aid for Africa. In 1998, the churches organized the Jubilee Debt Relief Campaign. The terminology used was to remind world leaders of the Biblical Year of Jubilee recorded in the Old Testament where the debts of debtors were forgiven. I remember going to a non-governmental organization-NGO workshop where I interviewed a key leader about his proposal for global taxation. I asked him what they were going to do with the huge flows possible from a global tax. He told me that there would be enough for both Africa and the United Nations! Seven years later, both debt forgiveness and the concept of global taxation have come full circle. This is it. This is where the rubber meets the road.
Over the last ten years, the idea of global tax has gone through a number of revisions. Last year French President Jacques Chirac put the idea of global tax on the leader's agenda and promised concrete recommendations. His proposed "International Solidarity Levy" would levy a tax on airline tickets. I find this curious since most airlines are bankrupt. What a carrot! Countries in favor include Brazil, China, and Germany. Currently there are no international treaties that prohibit the creation of a flat tax on airline tickets since a number of airlines already have various types of taxes on airline tickets for airport renovation and the like. The rate would be personalized according to country acceptance. Revenues would be collected by the airlines and passed on to the respective country which would supplement their foreign aid funds.
Before the world commits to the French plan which has been laid on the table and is in the process of being proposed now to the leaders of the entire world at the September United Nations General Assembly, there are a number of questions that should be asked, "How come Africa had no problems while they were colonies of Britain?" and "Why has Africa been the focus of wars and revolutions since the time of de-colonization?" Complex questions have complex answers. For people seeking truth, we will take a look at the Commonwealth, World Bank loans, NSSM200, the conditions being put on Africa, and global taxation.
First, let us take a look at what the Commonwealth of Nations is all about. According to the Internet encyclopedia, Wikipedia.org, "The Commonwealth of nations is a voluntary association of independent sovereign states, mostly formed by the United Kingdom and its former colonies." Today there are counties that acknowledge the British monarch as head of state and those that only recognize the queen as Head of the Commonwealth.
The old British Empire, we are told, was dismantled after World War II beginning with India. When de-colonized, many countries became republics. The London Declaration, which provided for members to accept the British monarch as Head of the Commonwealth regardless of their domestic constitutional arrangements, is now considered by many to be the start of the modern Commonwealth.
The population of the Commonwealth is about 1.8 billion people which comprise about 30% of the world's population. India is the most populous member with a billion people while Pakistan, Bangladesh, and Nigeria have more than 100 million people. The land of Commonwealth nations equals about twenty-five percent of the world's land area.
When the UN was formed in 1945, Canada, New Zealand, and the UK had three votes. As Britain de-colonized countries, the newly de-colonized countries were made voting members of the United Nations. Between 1946-1989, a total of 42 countries were de-colonized, thus giving the Commonwealth the potential of 54 votes which includes those countries that were already independent.
Apart from the votes which the Commonwealth has at the United Nations and at other international organizations, it is important to understand that the war, genocide, and the problems of poverty did not exist in Africa before de-colonization. Interestingly enough, of the twenty countries de-colonized between 1960-1969, seven are today Highly Indebted Poor Countries. They include Ghana which is rich in gold, bauxite, manganese and diamonds; Guyana which is rich in bauxite, manganese, gold and diamonds; Uganda which is rich in copper and cobalt, Tanzania which is rich in gold, diamonds and coal and Zambia which is rich in copper.
So why are they have trouble in today's globalized world? We can go back to World Bank loans during the 1970s which were forced on a number of African countries. Under World Bank President Robert McNamara, who served as president from 1969 to 1981, World Bank economists forced their way into countries in order to come up with a financial plan for their new development. Even the president of that country was not privy to what the plan said, but was under the gun of the World Bank to take loans to carry out these grandiose projects. The idea was that the income generated from the project would provide monies to repay the loans. Unfortunately that did not happen. These are now the Highly Indebted Poor Countries which you and I are being asked to bail out through increased foreign aid, debt forgiveness, and/or international taxation. Talk about a transfer of wealth!
If this did not de-stabilize Africa, there is more devastation that they have been subjected to. Interestingly enough, it occurred AFTER de-colonization. In 1974, President Richard Nixon was presented with a study by the National Security Council which is called, "NSSM 200 - Implications of Worldwide Population Growth for U.S. Security and Overseas Interests." This 250 page report was a result of a four year study which he had requested on August 10, 1907 in National Security Decision Memorandum 76. This memorandum recommended that the U.S. propose a United Nations study of "world population problems and measures required dealing with them as a top priority in the Second Development Decade." When the study was completed in May, 1974, it was sent to Nixon along with a memo by Dr. Henry Kissinger, then National Security Advisor, in which he recommended the need for the U.S. to provide leadership "in world population matters."
NSSM200 suggested that the U.S. needed "access to minerals which are necessary for military and industrial uses and for which the U.S. must reply on imports. Where these 'strategic and critical' materials are concerned, therefore, U.S. economic stakes in the developing world coincide with military considerations" (NSSM 200). Furthermore, it points out that if the resources found in a number of Lesser Developing Countries are important to the U.S. and if those countries develop with a normal increase in population, they will have a greater need for their resources, which means the U.S. will not have access to them. In other words, it was to the advantage of the U.S. to keep these countries from developing so the U.S. could have access to them.
The report identified using foreign aid funds as a way of "helping" the leaders of targeted countries to embrace population reduction. The report placed the agenda of population reduction on the shoulders of the United Nations, non-governmental organizations, and a number of UN agencies and commissions.
The United Nations did exactly what the U.S. government told them to do. They made population reduction a key focus of their agenda through Agenda 21 and sustainable development. At the UN Conference on Population and Development in 1994 in Cairo, African women asked representatives from Planned Parenthood International why they could only get condoms and not aspirins at their health clinics.
According to the British publication, Newstateman, after more than $400B of overseas aid channeled through African governments, the African people are on the whole poorer than they were 30 years ago.
So how much does Africa owe the World Bank and the International Monetary Fund? According to John Hilary from War on Want, about $532B is owed by the 60 Highly Indebted Poor Countries. Currently only 18 countries have qualified for debt forgiveness because they have met the conditions World Bank conditions. The amount of debt forgiveness is $40B but the debt servicing of the remaining $492B is $45B a year.
The World Bank's program for Highly Indebted Poor Countries-HIPC is funded by pledges and paid-in contributions. Steps poor countries have to take to qualify for a reduction in debt include: changing their structure of government to be "more accountable", make all financial figures public (transparency), privatize their energy sector, water, electricity, etc. and work through regional blocks with other cities and states. This is regional government which is appointed, not elected officials. In order to deprive the people of the world of representative and accountable government, regional government is being super-imposed over elected officials. In the U.S. President Nixon opened the door to regional government. In addition, the people of Europe have said no to regional government.
Today what you see is the plea for business to come in and partner with African governments. The Prince of Wales International Business Leaders Forum has called for "ten practical actions to support Africa's development." One of them is, "Work with other businesses in partnership with civil society organizations to support, social, health, human development and enterprise development."
At every turn, it is public-private partnership, selling off government owned resources, or privatizing through partnering with business. This is seen in President Clinton's New Partnership for African Development-NEPAD. President Bush has set up his own initiative, the Millennium Challenge Corporation-MCC, a U.S. government corporation, to administer funds. An informational brochure handed out at the G8 described it as "an innovative new foreign assistance program designed to eliminate extreme poverty and promote sustainable economic growth." The purpose is to set up public-private partnerships-PPP. PPP's are business arrangements for governments to transfer state-owned assets to. Since it is a business arrangement, it is run by the corporate partner that has the money. As expected, there are steps that countries need to take in order to be eligible, just like the World Bank qualifications. For example, the MCC Board approved a Compact with Cape Verde for approximately $110M. The Compact will support their efforts in achieving its overall national development goal of transforming its economy from aid-dependence to sustainable, private-sector led growth."
At the 2002 UN World Summit on Sustainable Development, an international public-private partnership, "The Congo Basin Forest Partnership," was announced. It has eight African countries, six of the G8 countries, the American Forest and Paper Association, and four major environmental organizations including World Wildlife Federation as partners. Seventy-four million acres of land in Africa will be moved into this partnership! In an interview with a U.S. State Department official by colleague Joan Peros, he refused to comment on any debt-for-nature swaps!
The question that should be asked is "What will these countries have left once they privatize their state owned assets and change their form of government to meet a global structure of government?
In an interview at the G8 with an African official from an African consumers group, he voiced the same concerns. They have made it very clear to G8 leaders that they do not want any more aid with strings and privatizations.
On the other hand, as reported by the British magazine, Newstatesman, many African countries are turning to China for help. Nearly 700 Chinese companies operate in 49 African countries. Chinese trade with Africa will reach $30B next year—triple the level five years ago. By the end of 2005, according to the French paper, LeMonde, China will overtake Britain as Africa's third-largest trading partner and it is increasingly turning to Africa as a source for oil, timber, and minerals for support its phenomenal growth.
The Sierra Leone tourism board and the Chinese construction company Henan Gouji recently signed a $220M agreement for a luxury golf course and five star hotel. Their tourism minister said, "Why should we wait for Britain or anyone else to get here? The Chinese are the ones coming to invest now."
Last year, China's export bank extended a $2B line of credit to the Angolan government for infrastructure projects. In return for low interest rates and a long repayment schedule, Angola will provide China with 10,000 barrels of oil a day and award China with large construction contracts. Interestingly enough, these are the terms that the World Bank should be offering! In Sudan where the U.S. maintains partial oil sanctions, China has become that country's largest trading partner. The list goes on.
Is this a case of creating a major continental-wide problem and then solving it to get the intended result which is a grand transfer of wealth?
In conclusion, it is not only the assets of Africa which are at stake, but the whole transfer of wealth through our tax-dollars to support the "war on poverty." In an interview with French President Jacques Chirac, I asked if the proposed "International Solidarity Levy" is going to be duplicated once it is in place. He told me there are many different proposals for global tax. I would assume that if the airline tax is passed without great opposition, that it will open "Pandora's Box" to a countless number of other international taxes. Without Africa, global taxation would not be possible. So, what about Africa?
RoperAB said:T3023 said:
After reading this......
How can you say we are fighting a "War" on Terrorism when they are opening the gates on everything.
lOOK right now America is the global economy. The UN dont mean s***. What in the heck can they do to you? Kick your ash? I dont think so.
You need a global economy. If you didnt trade with onther nations your economy would collapse. You certainly would never come even close to meeting your energy requirements.
Most of your National dept is actually just borrowed out of your old age security funds. Even Saddam Hussein was stock pileing American dollars!
I can spend American money in any part of the world. Try doing that with Canadian money.
Look why do they put trade restrictions on nations they dont like? Think South Africa, Iraq, etc.
THE NEW YORK STOCK EXCHANGES GOES GLOBAL-
THE CHERRY ON WORLD GOVERNMENT
Joan M. Veon
On Wednesday the New York Stock Exchange world's biggest stock exchange founded 213 years ago will go public. Its goal is to build a war chest in order to buy up other stock exchanges around the world. These actions herald a new phase in the new world order.
With stock exchanges around the world going public, it is the New York Stock Exchange that is the last of the private non-profit companies to offer shares to the public. You can imagine that if all the exchanges in the world are listed companies, then the mergers and acquisitions that are common among other stocks will also be part of the stock exchange empire. Can you imagine the NYX, as the new public company will be called, buying the Euronext and/or the London Stock Exchange? Talk about power! This is a parallel to the central banking power that now runs the global banking system.
Furthermore, within the last eleven years, the coming of a global stock exchange will compliment an evolving global currency and global tax. For those who say world government is far off, you had better point them in this direction. In order to understand what Wednesday really means, let us review structures that have been put in place that compliment a global stock exchange.
When Andrew Jackson was elected President in 1828 he announced in his first message that he would not renew the charter of America's first central bank. He ended up vetoing the law Congress passed to re-charter the Bank. Jackson pointed out that the bank's stock, valued at $8 million, was held by foreigners--chiefly in Britain. His concern was that a majority of shares of its stock might fall into alien hands, which if we were involved in a war, could use its influence against the United States.
In 1913, the question of a central bank came up again. The people involved in this effort included some of the wealthiest people in America: Senator Nelson Aldrich (grandfather of David Rockefeller); Jacob Schiff and Paul Warburg of Kuhn, Loeb and Company, an international banking house; Piatt Andrew, Assistant Secretary of the Treasury; Henry P. Davidson, Senior Partner of J.P. Morgan & Company; Charles D. Norton, and Frank Vanderlip, President of National City Bank which today is CitiGroup. The passage of the Federal Reserve Act of 1913 was done through chicanery. Those in the Senate who favored the Act did not go home while those that were against it went home for Christmas. In a special session convened with quorum, the Act passed at 11:45 p.m. on December 24, 1913.
With the passage of the Federal Reserve Act, our monetary system changed back to one of control by a private corporation and not the U.S. Treasury. Our currency now says, "Federal Reserve Note." Earlier in the day on December 24, 1913, Congressman Charles A. Lindberg, Jr. stated from the House floor: "This Act established the most gigantic trust on earth. When the President signs this bill, the invisible government by the Monetary Power will be legalized…The worst legislative crime of the ages is perpetrated by this banking bill." We should note that President Woodrow Wilson could have vetoed this bill like Andrew Jackson did, but he was put in power by the same powers that passed the bill.
Since 1913, the Federal Reserve has evolved into a very powerful entity globally. The Federal Reserve Act has been amended over 195 times with greater empowerments in the last ten years that have included more types of discount window loans. The discount window is where banks borrow from the Fed overnight to maintain their stated level of capitalization. The Fed now accepts for collateral: Treasury and federal agency securities, gold certificates, Special Drawing Rights, foreign currencies, and discount window loans made under Section 13 of the Federal Reserve Act. What this means is that as the indebtedness of America grows, the Fed is willing to take more types of collateral to secure their loans to the government!
As a result of the Asian Crisis in 1997-1998, the Group of Seven finance ministers, under the direction of President Bill Clinton and then Treasury Secretary Robert Rubin invited the central bank ministers of the G7 countries to join them in their discussions. Since 1998, it is both the G7 treasury secretaries and the central bank ministers who are directing the global economy.
The role of central banking in the United States was seen after the crash of the stock market in 1929. The Crash came about as a result of (1) America reducing the gold content of the dollar by 40%, (2) Speculation in the stock market, much of which was financed by credit, (3) Foreign investors selling their stocks, and (4) the Federal Reserve taking money out of the banking system which the Fed thought would stop the frenzy. In other words, this private corporation used the same technique used to burst the Nasdaq bubble seventy-two years later-they took money out of the banking system which made the market drop.
The Fed or any central bank is able to create market highs or lows by the amount of money they pump into the banking system (they buy U.S. Treasuries, which puts money into the system) or by taking money out of the banking system by selling U.S. Treasuries. When the Federal Reserve took money out of the banking system, it caused the Depression. John Maynard Keynes, a British socialist and economist, came over to advise President Franklin Roosevelt. His solution was to go into debt in order to stimulate the economy. President Roosevelt financed all of his New Deal programs by borrowing money.
The legacy today of Roosevelt and Keynesian economics is that every level of government is broke: local, county, state, and federal and every level of government is selling assets in order to pay down debt. In the last several years, the City of Chicago sold the Chicago Skyway, a toll road to Spain's Grupo Ferrovial and to a unit of Australia's Macquarie Bank for $1.8B. Since then other toll roads around the country are being sold. The ports are part of the same equation.
When President Franklin D. Roosevelt was elected on his "New Deal for the American People" program, his first act as president on his inaugural, March 4, 1933, was to declare a national bank holiday. For the next 8 days, banks were closed because of the number of people withdrawing their savings in gold.
A little more than a month later, on April 20, Roosevelt passed the Emergency Banking Act of 1933 which took America off the gold standard. It put an end to the following: (1) Convertibility of notes into gold for Americans but allowed foreign countries to convert their gold-backed dollars at any time and (2) Private ownership of gold was made illegal except if you were a rare gold coin collector. In essence the American financial system was transferred from a standard of accountability which used gold to guard against excess debt, to a system in which there is no accountability. All a government has to do is print money. This opened the door for the massive debt which is Keynesian economics at its finest: a world in debt to a private group of bankers.
However, if you really want to control the monetary system of the world, not only do you have to control the banking system, but you have to devalue its money. It was President Nixon who severed any remaining ties the dollar had to the gold standard in 1971. Between 1933 and 1971, foreign countries that owned gold backed dollars were able to redeem them for gold. However, when Nixon closed the "Gold Window", it changed the monetary system of the world from one in which currency was gold-backed to a paper system. Basically what Nixon did was to DEFAULT on millions of dollars that those countries held in their vaults.
There is no other historic incident that can equate the financial devastation that Nixon did when he took the dollar off the gold standard. Never before in the 6,000 year history of trade, was a piece of paper been used. During Biblical times and earlier, traders used animals, jewels, expensive clothing, and gold and silver to trade. These all have TANGIBLE value. Today, the world is on a fiat monetary system that has nothing of value supporting it. The purchasing power can drop simply by government printing more paper money! From what we can understand, this was the first phase of changing the monetary system of the world.
The second phase was to internationalize it. In 1944, finance ministers from over 40 countries of the world met in New Hampshire to set up financial international institutions that would deal with a post-War world: the International Monetary Fund and World Bank. Their objective was to set in place global institutions that would facilitate the financial and economic integration of the nation-states. That however was not the immediate objective. Both of these institutions were set in place to facilitate loans to help rebuild war-torn Europe. Today on a bi-annual basis, finance ministers from 186 countries of the world meet to determine the state of the world's finances. Both of these organizations have been instrumental in "harmonizing" financial growth around the world and redistributing growth from strong countries to weaker countries. In fact, the World Bank established the International Finance Corporation that has established over 60 stock exchanges in third world countries.
From an economic standpoint, if you are going to put a global economic infrastructure in place, it must also be political and encompass trade. The United Nations was established in 1945 and the final piece of a global trading system was birthed in 1994 when our Congress passed the 27,000 page General Agreement on Trade and Tariffs which established the World Trade Organization. The purpose of which is to have a completely flat trading system-no barriers of any kind. No longer does the American farmer, accountant, manufacturer, or engineer compete with his competition across town, but he now competes on a global playing field. Since President Bush II has been in office, 2.7 million jobs have left the U.S.
Open borders supported by the World Trade Organization need for the countries of the world to de-regulate laws that restrict where people can invest. In 1980, during the Carter presidency, Congress passed the Monetary De-Regulation Act of 1980. It impacted the U.S. in several ways: First, it changed various federal laws as foreigners could now invest in America and Americans could now invest outside the United States. These changes led to the proliferation of foreign and global mutual funds, global mergers and acquisitions between companies, and $2T in stateless money running around the world daily looking for higher returns and a quick currency play. Obviously the integration of investments and corporations is part of making the world one and in changing its currency from individual nation-state currencies to a global currency. Secondly, it gave the Federal Reserve more power over the U.S. banking system.
At the 1995 Group of Seven meeting in Halifax, the heads of state and the G7 finance ministers embarked on putting in place a "new international financial architecture." It included a number of deep empowerments and structural changes being made to the International Monetary Fund and the World Bank in order to prepare it for a world without borders. The IMF has the responsibilities which include "surveillance" of the world's banking systems and the flow of monies worldwide. In addition, the IMF makes available lines of credit for countries in trouble, our Congress graciously made $18B available for this purpose. These changes were touted by both Robert Rubin and his successor Larry Summers as necessary for the 21st century. This is all part and parcel of the evolving global stock exchange.
Of course, no take-over of the global economic infrastructure would be possible without changing key laws. In 1999, Congress passed HR10 which was the "Banking Modernization Act." It helped modernize our banking system by repealing the 1933 Glass-Steagall Act which separated commercial banking from investment banking. HR10 merged these two activities, thus returning the stock market to pre-1929 times. In addition it provided for foreign banks, insurance companies, and brokerage firms to buy American banks, insurance companies, and brokerage firms.
So now if you are going to globalize the entire financial architecture, you then need international accounting standards. Using Enron as an exampled, former Federal Reserve Chairman Paul Volcker called for international accounting standards. The fact that he is chairman of the Board of the Trustees for the International Accounting Standards Committee (IASC) which is located in London was very convenient! Now countries around the world are converting to these new rules.
Getting "Joe Average" into the market was also necessary. By the end of the 1990s, the highest number of Americans, 45%, owned stocks either through a 401k, IRA, or personally. Today, the market has a psychological affect on people. When it is up, people feel good and when it is down, they are not happy. When Greenspan was Fed Chairman, the bottom line is that "When Greenspan speaks, the markets listen."
Lastly, to facilitate a global financial architecture, you need "market-based democracy" - that is what Treasury Secretary John Snow called it in February, 2004. He basically told the world that every market is dependent on growth in another country and that we need to let market forces work.
Secretary Snow was signaling the new MARKET BASED GOVERNANCE SYSTEM in which the stock, bond, commodity, and currency markets now rule the world. This change has been coming for some time and began with President Reagan and the privatization or selling off of government assets that he encouraged. Those assets, in some cases, went into the market. The World Bank also developed the market by setting up stock exchanges in many developing countries where there were none: China, Russia, Brazil, South Africa, Ghana, Poland, etc. To help these countries have stock to trade on their new exchange, they sold or privatized state owned assets: railroads, banks, telephones in order to list them on their new exchange. According to the World Bank, more than 80 countries are selling state-owned assets.
At one point in our banking history, banks held the loans they made as part of their portfolio: mortgages, automobile loans, credit card loans, and personal loans. Today, banks have sold them and transferred the risk that they use to assume to the market (you and me). This technique is called "securitization." What this means is that the market now is like the kitchen sink-everything is in it: mortgages, auto loans, credit card loans, home equity loans, stocks, bonds---everything and now stock exchanges!
In 2002, based on remarks by Dr. Jacob Frenkel, I asked him if he saw a global currency in the market for a globalized world. He told me that before we could have a global currency, we needed harmonization of economies. Eighteen months later I asked former Federal Reserve Chairman Paul Volcker if we needed a global currency and he told me, "For the long term-but it's a long ways off, if we are going to be successful in a globalized world, we should have an international currency." Since 2004, I have been asking key officials at the Bank for International Settlements in Basle about a global currency, they have told me it is a long way off. I don't know what they call "a long way off" for chief economist William White just issued a Working Paper, #193, in which he says the global imbalances that the world economy currently has will lead either to a return to the gold system (which is highly unlikely since you can't print paper like we are currently doing) or an international currency.
So now we have the harmonization of world economies, the calls for an international currency, a market based system in which all assets are now traded on the stock or bond exchange and we are seeing now the rise of a global stock exchange! All we need now is global taxation and that too, is in the works.
The United States is the only country in the world NOT to have a Value Added Tax and this is now part of President Bushes "tax simplification" measures. As well, France is the first country to put a tax on airline tickets to help the poor countries of the world. There are ten other countries that are considering it as well. I asked French President Jacques Chirac what he thought about a tax on airline tickets and he told me that if it was success, "many more global taxes of this kind" were being planned. Welcome to the new world order. World government is not coming. It is here.
agman
Well-known member
DiamondSCattleCo said:
The percentage drop at retail will not and should not drop one-for-one with cash prices. Retail does not go up one-for-one either. The relationship is approximately 1:4. I will let you figure out why? Hint: If energy costs drop 50% do your operating cost drop an equal amount? If not, why not?
Does the east not have a much larger percentage of the Canadian population-just curious?
DiamondSCattleCo
Well-known member
agman said:
1) Its not tough to figure out. Obviously the cost of the animal isn't going to be all of the processing costs. But only 1/4 of the costs? Uh uh. If thats the case, we need to eliminate the large packing plants and go back to processing with small shops, because they're able to function less expensively than that. And it still doesn't explain why hamburger costs remained fixed while culls dropped in price by 75%. Someone was making a pile of money. It wasn't the store, because their costs didn't change in Western Canada. It wasn't the producer. So that leaves only one place.
2) When calculating out average retail, you need to take into account the eastern population and the amount of beef they eat, obviously. I'm not sure if Canfax weights their retail prices or not. However that doesn't stop the fact that 80% of animals are in Western Canada, as is 80% of the slaughter capacity. So the average price paid to producers had better reflect an 80% weighting to accurately gauge what was paid during the BSE years.
agman
Well-known member
DiamondSCattleCo said:
The cost of cattle is a much smaller percent to the retail price and cost then you are aware of. For retail product in general the commodity cost is generally only 20% of the total cost. For beef the percentage is close to 25%. Check it out. What difference does it make where they are raised? If all the cattle were raised in western Canada and all the beef consumed was in eastern Canada the cost difference would reflect transportation. What if the price of cattle went down 2% and transportation cost went up 3%. What would retail prices do?
DiamondSCattleCo
Well-known member
agman said:
Explain how we were able to spend 4 years at 70 cent cull prices, if the cost of the animal was only 25% of the retail. The grocer makes 20% of the retail right away. You aren't going to convince me that the packers lost money for 4 years during one of the heaviest runs of cull cattle in Canadian history.
And it makes a large difference where they are raised. Prices in eastern Ontario didn't take much of a hit, from what I understand. Our prices out west + transport to Ontario < eastern cattle prices during BSE. So, any analysis of BSE prices would HAVE to be weighted to show that 80% of the animals were sold in Western Canada, otherwise the analysis is worthless.
Rod
agman
Well-known member
DiamondSCattleCo said:
In all due respect you need to study the retail structure and related costs.
Also, if you actually believe the retailer makes 20% you should get out of the cattle business and open a retail outlet immediately.
For beginners, a cow at $70 yields 47% which takes the wholesale to $149 just to cover live cost-no processing. Do you know what it costs to process a cow? Then you have to go to retail and all its associated cost. Get the picture. It won't take long and we will be at that 25% figure I quoted. Where did I try to convince you that packers lost money for four years killing cows? I never made or implied such.
DiamondSCattleCo
Well-known member
agman said:
1) Actually I _KNOW_ the retailer gets a 20% markup average on beef. I'm friends with the local Co-op and IGA manager and they've allowed me to look at their books. Canfax also reported an average 20% retail markup. From that 20% they have to pay employees, keep the lights on, etc etc etc. Its doggoned tough for a retailer to make it on 20%.
2) I was simply going by numbers that you, SH, and Jason gave me when I was doing my simply cost breakdown from before. Since the packers were only making $60/animal at 30 cents/lb live by the time we were done, adding another 40 cents to the cost of the cow would drive us into HEAVY losses.
So lets take your $1.49/lb rail - no processing. To only be 25% of retail, that means the retail value of that animal $5.96/lb. Not sure what hamburger sells for in your area, but my area doesn't get that high.
Agman, I keep hearing people asking me what it costs to process the beef, SRM removal, etc etc. Since you, SH and others seem to be in the know, please provide us with a breakdown so can be similarly enlightened.
Rod
A
Anonymous
Guest
Rod,
Why do you continue to go through life SPECULATING what packers and retailers are making when you proved with your previous "simple" example that you don't have a clue what processing and retail costs are?
Do the research and find out for yourself. The only costs I mentioned in that previous example were the ones I could think of off the top of my head which immediately shaved your initial profit estimates down to almost nothing. Just because I didn't mention other costs does not mean there is not other costs. I only mentioned the ones that I knew you missed. There is others. If you want to know what those costs are, why don't you find out rather than speculating?
Bottom line, YOU DON'T KNOW WHAT PACKER AND RETAIL EXPENSES AND PROFITS ARE so why speculate? Why not find out the truth?
If you are so convinced all this money is there to be had, why not open your own packing or retail beef company?
Because you want someone or something to blame, that's why!
~SH~
Why do you continue to go through life SPECULATING what packers and retailers are making when you proved with your previous "simple" example that you don't have a clue what processing and retail costs are?
Do the research and find out for yourself. The only costs I mentioned in that previous example were the ones I could think of off the top of my head which immediately shaved your initial profit estimates down to almost nothing. Just because I didn't mention other costs does not mean there is not other costs. I only mentioned the ones that I knew you missed. There is others. If you want to know what those costs are, why don't you find out rather than speculating?
Bottom line, YOU DON'T KNOW WHAT PACKER AND RETAIL EXPENSES AND PROFITS ARE so why speculate? Why not find out the truth?
If you are so convinced all this money is there to be had, why not open your own packing or retail beef company?
Because you want someone or something to blame, that's why!
~SH~
~SH~ said:
If you want to know what those costs are, why don't you find out rather than speculating?
The cattlemen asked the Alberta govt. to do just that and the report they came back with did not answer any of the questions asked.
Rod has already pointed this fact out.
Stop supporting the obvious frauds against the producers and the hiding of information from producers, SH.
Your little "blamer" game is running out of fuel in the light of real facts, SH.
Rod, first of all I would like to thank you and Agman for an excellent point-counterpoint discussion. You both have proved that you can disagree with out using childish insults and put downs which add nothing to a discussion. Discussions like these are the ones I came to this forum to find. Thanks again.
There is a lot of information out there on captive supply. Too much to post here. Most of this may be 'old hat' to you but I will post some of the highlights from gipsa studies. It will take 2 posts and will just scratch the surface.
"Statistical results from the Schroeder, Mintert, Barkley and Jones (1992) study indicated a negative statistical relationship between fed cattle prices and captive supplies. Over the six-month period, contract deliveries were associated with decreased fed cattle prices in the surveyed feedlots of $0.15 to $0.31 per cwt."
"Elam conducted another early study of the market effects of captive supply, looking at two possible implications of captive supply. In the first part of a two-part study, he compared forward contracted cattle sales in six Texas feedlots with hedged fed cattle from May 1987 to September 1989. His results indicated that contract prices were $0.28 to $0.59 per cwt lower than hedged prices for steers and $0.86 to $1.64 per cwt lower for heifers."
"Elam also examined the aggregate effect that deliveries of captive supply cattle had on fed cattle prices in the U.S. and in the states of Texas, Kansas, Colorado, and Nebraska. Using time series regression analysis, Elam found a negative statistical relationship between captive supplies and monthly average fed cattle prices over the period from October 1988 to May 1991. For each 10,000 cattle delivered under captive supply arrangements, U.S. fed-cattle prices were lower by $0.03 to $0.09 per cwt. Results for individual states varied from no price difference to lower prices ranging from $0.15 to $0.37 per cwt."
"Schroeder, Jones, Mintert and Barkley (1993) expanded on their 1992 analysis examining the short-run impacts of forward contracted cattle. Using data from the same feedlots in southwest Kansas during the same six-month period in 1990, they found that average cattle prices were affected by many factors, but that when forward contract shipment levels are high, changes in forward contract shipments had a larger impact on prices than when shipments are low, and that price variability increased under these conditions."
USDA Advisory Committee on Agricultural Concentration
The Committee released its findings and recommendations on June 6, 1996 in Concentration in Agriculture: A Report of the USDA Advisory Committee on Agricultural Concentration.
Among its findings:
"Captive supply and other forms of vertical integration and coordination at levels in which they occur – in some regions and at some times of the year – are potentially detrimental to both competition and price discovery. Captive supply arrangements tend to thin market reporting (reduce the volumes on which reported prices are based) and shorten the weekly marketing window, which can disadvantage suppliers who do not have a packer arrangement and distort reported market prices downward."
There is a lot of information out there on captive supply. Too much to post here. Most of this may be 'old hat' to you but I will post some of the highlights from gipsa studies. It will take 2 posts and will just scratch the surface.
"Statistical results from the Schroeder, Mintert, Barkley and Jones (1992) study indicated a negative statistical relationship between fed cattle prices and captive supplies. Over the six-month period, contract deliveries were associated with decreased fed cattle prices in the surveyed feedlots of $0.15 to $0.31 per cwt."
"Elam conducted another early study of the market effects of captive supply, looking at two possible implications of captive supply. In the first part of a two-part study, he compared forward contracted cattle sales in six Texas feedlots with hedged fed cattle from May 1987 to September 1989. His results indicated that contract prices were $0.28 to $0.59 per cwt lower than hedged prices for steers and $0.86 to $1.64 per cwt lower for heifers."
"Elam also examined the aggregate effect that deliveries of captive supply cattle had on fed cattle prices in the U.S. and in the states of Texas, Kansas, Colorado, and Nebraska. Using time series regression analysis, Elam found a negative statistical relationship between captive supplies and monthly average fed cattle prices over the period from October 1988 to May 1991. For each 10,000 cattle delivered under captive supply arrangements, U.S. fed-cattle prices were lower by $0.03 to $0.09 per cwt. Results for individual states varied from no price difference to lower prices ranging from $0.15 to $0.37 per cwt."
"Schroeder, Jones, Mintert and Barkley (1993) expanded on their 1992 analysis examining the short-run impacts of forward contracted cattle. Using data from the same feedlots in southwest Kansas during the same six-month period in 1990, they found that average cattle prices were affected by many factors, but that when forward contract shipment levels are high, changes in forward contract shipments had a larger impact on prices than when shipments are low, and that price variability increased under these conditions."
USDA Advisory Committee on Agricultural Concentration
The Committee released its findings and recommendations on June 6, 1996 in Concentration in Agriculture: A Report of the USDA Advisory Committee on Agricultural Concentration.
Among its findings:
"Captive supply and other forms of vertical integration and coordination at levels in which they occur – in some regions and at some times of the year – are potentially detrimental to both competition and price discovery. Captive supply arrangements tend to thin market reporting (reduce the volumes on which reported prices are based) and shorten the weekly marketing window, which can disadvantage suppliers who do not have a packer arrangement and distort reported market prices downward."
#2
Another side of the coin.
"Elam concluded cattle feeders were giving up a portion of the basis price to packers when they sold cattle through forward contracts, with the difference representing a risk transfer premium from cattle feeders to packers. Specifically, Elam's conclusion suggests that to the extent the packer assumes the feeder's price risk under a forward contract, the feeder receives a lower price for cattle."
"According to Ward and Bliss, the surveyed feedlot operators indicated that the primary benefits of forward contracting were improved financing and securing a known buyer. The feedlot operators indicated that they believed the primary benefits to packers were guaranteed supplies of cattle for slaughter and increased control over the timing of deliveries of cattle for slaughter."
"Lyford, Hicks, Ward, Trapp and Peel's study suggests that the response of spot market price to changes in fed cattle supply with contracting depends on the level of fed cattle supply with contracting. Lyford, Hicks, Ward, Trapp and Peel's research suggests that earlier empirical studies that showed negative or mixed relationships of contracting with spot market prices may be the result of market supply conditions that existed at the time of the studies. Their research underscores the need to account for overall supply and demand conditions in analyses of captive supply's impact on spot market prices."
"Schroeter and Azzam used GIPSA data from February 5, 1995 through May 12, 1996 for four large beef packing plants located in the Texas Panhandle. The primary data set included information on every lot of cattle over 35 head purchased by the four plants during the period. Supplementary data included regional average steer and heifer prices, boxed beef cutoff values, Chicago Mercantile Exchange live cattle futures prices, and other variables."
They found:
"The feedlot determines the number of cattle it will deliver to a plant under a given marketing agreement and within a given week. The feedlot normally determines the number of marketing agreement cattle to be delivered within any given week two weeks in advance of delivery. Once the feedlot sets the volume of marketing agreement deliveries for a given week, the packer chooses the specific day or days of the week on which delivery will be made.
There is a negative statistical relationship between weekly non-spot procurement methods (captive supply) and the weekly average spot market price.
In deciding when to deliver the cattle, rational, profit-maximizing feedlots chose to deliver marketing agreement cattle in that week which promised the highest expected spot market price because the marketing agreement cattle brought a price based on the spot market price. Because marketing agreement cattle delivered in two weeks bring a price based on the spot market price paid for cattle next week, one would expect to see a positive statistical relationship between captive supply delivered in two weeks and the expected spot market price for the next week. Similarly, one would expect to see a negative statistical relationship between captive supply delivered in two weeks and the current forecast of spot market price in two weeks. The observed statistical relationship between spot market prices and cash supply deliveries arises because expected prices are positively correlated with actual market prices. Under this scenario, deliveries of captive supply in a week do not cause spot prices during that week to be low. Rather, the expectation of low spot prices in two weeks time, which usually come to pass, leads feedlots to sell more cattle a week early and deliver them the following week later. This mechanism does not support the argument that increases in captive supply deliveries cause average spot market price decreases.
Econometric results do not support the hypothesis that packers try to manipulate formula base prices through their pricing strategies in spot market purchases. When Schroeter and Azzam compared marketing agreement deliveries with a price based on plant-average hot cost to those with a price based on the USDA-reported price, they found no systematic difference in the relationship between the volume of market-agreement deliveries one week and spot market prices paid the previous week.
The researchers recommended "that the agency should not rely on the statistical finding of a negative correlation between the use of non-cash procurement methods and spot market prices as evidence of intent by packers to depress cattle prices through the use of non-cash procurement, or as evidence of the unintentional consequence of lower prices as a result of the use of non-cash methods" (pp. 9,10)."
Another side of the coin.
"Elam concluded cattle feeders were giving up a portion of the basis price to packers when they sold cattle through forward contracts, with the difference representing a risk transfer premium from cattle feeders to packers. Specifically, Elam's conclusion suggests that to the extent the packer assumes the feeder's price risk under a forward contract, the feeder receives a lower price for cattle."
"According to Ward and Bliss, the surveyed feedlot operators indicated that the primary benefits of forward contracting were improved financing and securing a known buyer. The feedlot operators indicated that they believed the primary benefits to packers were guaranteed supplies of cattle for slaughter and increased control over the timing of deliveries of cattle for slaughter."
"Lyford, Hicks, Ward, Trapp and Peel's study suggests that the response of spot market price to changes in fed cattle supply with contracting depends on the level of fed cattle supply with contracting. Lyford, Hicks, Ward, Trapp and Peel's research suggests that earlier empirical studies that showed negative or mixed relationships of contracting with spot market prices may be the result of market supply conditions that existed at the time of the studies. Their research underscores the need to account for overall supply and demand conditions in analyses of captive supply's impact on spot market prices."
"Schroeter and Azzam used GIPSA data from February 5, 1995 through May 12, 1996 for four large beef packing plants located in the Texas Panhandle. The primary data set included information on every lot of cattle over 35 head purchased by the four plants during the period. Supplementary data included regional average steer and heifer prices, boxed beef cutoff values, Chicago Mercantile Exchange live cattle futures prices, and other variables."
They found:
"The feedlot determines the number of cattle it will deliver to a plant under a given marketing agreement and within a given week. The feedlot normally determines the number of marketing agreement cattle to be delivered within any given week two weeks in advance of delivery. Once the feedlot sets the volume of marketing agreement deliveries for a given week, the packer chooses the specific day or days of the week on which delivery will be made.
There is a negative statistical relationship between weekly non-spot procurement methods (captive supply) and the weekly average spot market price.
In deciding when to deliver the cattle, rational, profit-maximizing feedlots chose to deliver marketing agreement cattle in that week which promised the highest expected spot market price because the marketing agreement cattle brought a price based on the spot market price. Because marketing agreement cattle delivered in two weeks bring a price based on the spot market price paid for cattle next week, one would expect to see a positive statistical relationship between captive supply delivered in two weeks and the expected spot market price for the next week. Similarly, one would expect to see a negative statistical relationship between captive supply delivered in two weeks and the current forecast of spot market price in two weeks. The observed statistical relationship between spot market prices and cash supply deliveries arises because expected prices are positively correlated with actual market prices. Under this scenario, deliveries of captive supply in a week do not cause spot prices during that week to be low. Rather, the expectation of low spot prices in two weeks time, which usually come to pass, leads feedlots to sell more cattle a week early and deliver them the following week later. This mechanism does not support the argument that increases in captive supply deliveries cause average spot market price decreases.
Econometric results do not support the hypothesis that packers try to manipulate formula base prices through their pricing strategies in spot market purchases. When Schroeter and Azzam compared marketing agreement deliveries with a price based on plant-average hot cost to those with a price based on the USDA-reported price, they found no systematic difference in the relationship between the volume of market-agreement deliveries one week and spot market prices paid the previous week.
The researchers recommended "that the agency should not rely on the statistical finding of a negative correlation between the use of non-cash procurement methods and spot market prices as evidence of intent by packers to depress cattle prices through the use of non-cash procurement, or as evidence of the unintentional consequence of lower prices as a result of the use of non-cash methods" (pp. 9,10)."