Wall St. Journal says "Store Food Now"

http://online.wsj.com/article/SB120881517227532621.html?mod=googlenews_wsj

"Load up the pantry," says Manu Daftary, one of Wall Street's top investors and the manager of the Quaker Strategic Growth mutual fund. "I think prices are going higher. People are too complacent. They think it isn't going to happen here. But I don't know how the food companies can absorb higher costs."

I like his angle. Don't buy the food because of a panic over shortages, buy it as a cost-savings measure. He predicts the cost of food will increase ~4.5%, so by buying now you'll save money later. It a better investment than keeping it in a savings account (~2.5% return, if you are lucky).

Time for another trip to Sam's Club.

-Blast

The 4.5% return on stocking up on food is tax free and the 2.5% return from the bank is taxable, so the after-tax spread is larger than the 2% difference.

Justmeagain,

Very good point!

Hmmm, I wonder if I can convince DW we should stockpile Maker's Mark Whiskey...

-Blast

Blast (and other interested parties),

Tell your DW that it's for "medicinal purposes" because of it's "disinfectant abilities". There's #1 "reason".

Tell your DW that it has great "barter value" because of it's "drinkability and disinfectant abilities which would allow you to trade for something that is very needed,,,like disposable diapers and baby wipes for DD2*. There's #2 "reason".

(*note: this "reason" expires at the time DD2 graduates into panties after being successfully potty trained)

I am all grumpy because my wife made me buy 50 kg of rice. Silly me.

Reason #3 - a shelf life of 15+/- years assuming kept in a constantly cool place (temp under 70), away from direct light, and Blast is not told where said stock pile is kept.

I am just finishing a book titled 'The Alpha Strategy' written back in the early 80's. The author's emphasis is on purchasing items (durable goods) you will use for many years in bulk - including some wines and hard alcohol because they will last for years. When you open a bottle some years down the road - you have saved yourself the difference of the current price less than the price you paid several years ago. Plus buying in bulk often gets you an additional discount above the price paid at the time for a single bottle. His general belief is that inflation will always out-pace interest earned and investment gain (after taxes on the interest and gain) in the long term. His breakdown of real economics is unique, but hard to refute.

The book is available online for free pdf download or copies can be found at Amazon.com for under $5.00 including shipping.

Search under: Alpha Strategy John Pugsley

You'll find the link to the pdf download near the top of the search.

Some basic stockpiling makes good sense - especially if you are going to use it anyway! Just stay away from trendy items like roller-disco pants, Milli Vanilli hair extensions, and Oprah's Books Of The Month.

Those of us who went through the recession of the 70's will be familiar with all of these strategies. It seems weird to think that in hard times you spend, but that's the way it works. 'Might as well buy it now (as best you can) because it will cost more later. The advice is presented in a little more sophisticated way this time, but it's deja vu all over again.

As for me, with little storage space and cash, every time I go to the grocery, I also throw in one "staple" (5# flour or sugar, a package of rice, beans or salt) and a couple of extra cans of whatever veggie or soup is on sale. It's surprising how quickly it builds up with little effort or at-the-time cash layout.

The government is sending us an "economic stimulus" check soon. What better way to spend it than to forgo the "made somewhere else" electronic toy, and invest it in American grown food?

"The government is sending us an "economic stimulus" check soon."

I thought they were all being sent to the oil companies.

Sue

They are,,,,and to the big agriculture corporations......in a round about way!!!!!!

I am sure mine will be going to an American firearm manufacturer. Just can't decide if I want a made in Connecticut Seecamp 380 or a made in Maine Bushmaster AR 15.

I am kind of biased to Bushmaster as I grew up in Maine and like the logo. But I am looking at buying some AR lowers from Spike's Tactical. http://spikestactical.com He laser etches logos on his lowers which i think are kind of cool.

Smith and Wesson has a $100 rebate on their ARs that expires tomorrow. FWIW they have a $50 rebate and two free mags on their Sigma & M&P pistols too.

On the food front... I've noticed several local stores that are also offering gift cards (that have values that exceed the purchase price) in exchange for stimulus checks. One local grocery is offering a $325 gift card for every $300 in stimulus money. IIRC Lowe's has a similar deal in place.

That's a great idea. I caught the tail end of a segment on NPR radio a month or two back. It was an interview with a behavioral economist, I think that's what he called the field. Anyway, he was saying that there are better ways to distribute a stimulus package than simply sending everyone a check. A check that is deposited into your bank account is likely to go straight to pay down some outstanding credit card balance or go straight to savings, which provides no/very little stimulatory effect on the economy in the short term.

The economist said that other methods, like sending everyone a "gift" card with the same amount as these stimulus checks, would be far more likely to be spent for new goods or services and thereby give the economy its needed boost. Since consumer spending is about two-thirds of GDP, the guest suggested that it would be money well spent if the gov't would actually set aside a bit of the stimulus package to fund research on better, more innovative ways of delivering this stimulus money. Try to find out how to get the most bang for the buck, so to speak.

FYI - I did some research on Daftary and the Quaker Strategic Growth Fund (I have a subscription to the online edition to the journal.) It should serve as a gentle warning for those who follow a mutual fund manager's advice.

Almost 10% of this mutual fund is invested in Archer-Daniels-Midland, a large agricultural firm and a Potash Company which is one of the largest manufacturers of agricultural fertilizer. Wheen Daftary suggests people buy more food, it also helps out the stocks which make up a good percentage of his mutual fund. I'm not saying that he's being dishonest, but he should operate in a mode of full disclosure.

This doesn't mean we shouldn't buy extra food, I'm just apply my job skills from a former life (business analyst) to suggest that Daftary's comments need to be "consumed with a grain of salt."

The story that I read did disclose his connection to the ag industry.

Another aspect of cost savings from stocking up is bulk purchase. This can take that percentage up even higher. With a stocked pantry I don't have to buy during shortages, whether due to actual shortage or from panic buying. When the next crop of rice hits the market and the price is stable I can buy again. Since I had a years supply before the rice "shortage" I don't need to buy right now. I can do the same with all of the staples and realize an investment gain on grocerys rather than a burden from shortages. I have done this for years and don't consider it "hoarding" but commodity investments!

I bought 20 lbs JUST before the panic hit the news. That's enough to last this family of 4 a LONG time

From what I am reading, the USA won't be short on rice, it's flour and cooking oil that we will see a somewhat serious shortage of.

As a head's up to others just getting started into food storage, I have just found a relatively new web site for learning the basics of preparedness relating to water, food and tool use: Simply living smart

The usual caveat applies (I have no affiliation with this organization).

After perusing the site this weekend I have found it to be very helpful and approachable. The instructional videos are amateurish, but that just lends to the honesty of their project. From what I've gathered the couple that started the site seem to be just getting into the field/business, having recently moved to Idaho and launching this web site in the Summer/Fall of 2007. To fill in the gaps of their expertise in some areas it seems they have partnered with individuals who have greater experience and solicit seminars from emergency management officials on topics of emergency preparedness.

Anyway, I thought ya'all might want be interested in this site relating to the topic at hand. I've been learning a lot from this site in complement to what I have learned from ETS. Indeed, many subject areas overlap. The site registration, print articles, and instructional videos are all free. It looks like they do run a "webshop" containing some of the products they describe in the instructional videos but I think the website is primarily supported by Food Cannery sponsors at the bottom center of the page.

I'm curious to hear what others at this forum think of this new site. Interestingly it appears to me that "Home Food Storage" is becoming more mainstream. Still not to the level it was for our grandparents, but examples of news stories like the one in this thread and the start of websites like simplylivingsmart.com show the recognition of some of the general public to the benefits of preparedness. I wonder if we are on the way to an awareness "tipping point" of some kind.

Cheers,
Nemo

Hi Nemo,

I came across the Simple Living Smart website last night and wasn't able to get on for some reason. I passed it up for that reason. Only the top heading came up. But today with your link I was able to get on and check it out. Thank you so much for sharing it. I really like this new site and plan on becoming a member. They have video's and links to other sites that I like, like NitroPak.

Their video's give easy ways to fix foods using your food storage. Like how to make simple Popped Wheat to add to salads (like crouton's). I think the popped wheat would be a great addition to a salad of sprouts if you ever do have to rely on your food storage.

Anyway, thank you again for sharing it!

Joy

Hey again Nemo.

I HATE that they make you register to read their information.. if they are a business and selling me something they shuold let me read free and then decide to buy or not. Forcing me to register is pointless for them and me (unless they are tracking users to spam them).

Yeah, and grocery stores should let me eat the food and make sure I like it before I pay them.

Hey Todd,

To lend credence to their claims of "not selling info or spamming registered users", I have been registered for two weeks now on a new email address that no one has but them and I have only received a conformation letter and a newsletter from them. The new email address came free with my new DSL connection. I'll keep you posted if they ever spam me.

I think registering users makes users a little more accountable. IMHO since they are offering this service free (and they are just a small company out of Idaho) they can limit bandwidth to those folks who are serious about obtaining the info. Even google and youtube make you register to access many features of their site's content. The information age is a great resource but one side effect is bringing less privacy and I can understand folks who have a problem with that, it took a while for me to loosen my grip a little too.

Cheers,
Nemo

Edit: To add I think number of registered users would also be more attractive to potential advertisers than a general number of hits. It might be one reason why myspace and facebook are so popular. Also much of the information they are offering is "how to" in nature and not on "products" to sell. They do of course have products they recommend and sell through their site, but many things like their cooking courses and emergency prep videos are mainly informational in nature. Just my opinion...jeez I just realized I sound like a business man and I'm only an academic.

That's why I have an anonymous account at Yahoo. I treat my actual e-mail addresses just like my home street address. If you don't need it, you don't get the real one. If it's someone that may need to contact me in a timely manner (i.e. I order something online) they get my actual address. If it's a site that needs an e-mail address to register but I don't care to receive mail/take the risk of spam from, they get the Yahoo account. I check it occasionally, clean out the junk that makes it through their spam filter, & forward anything I decide to keep/move the sender to the approved list to me.

Edit: I'm even worse about cookies and ActiveX plug-ins. You shouldn't have to have cookies until you actually add something to your cart or log in, even to a store site. Any site that wants to send ActiveX plug-ins makes me wonder what they're trying to download to my machine along with it.

I'd think they would have better results if they split the difference by posting one or two of each category or even a contents page that you could access without registering. As it is, you're "buying a pig in a poke" for your information.

I agree UT,


I also use a junk email account, a personal email account and a business email account. Its a good approach. I do agree that providing most at least text info and some videos without registering would be a better approach and would give users a chance to see what they are registering for.

I'll have to send them an email listing your suggestion. I think a good example demonstrating your suggestion is this ETS forum. It allows folks to read and subcribe to the RSS feed but requires registration if a person wants to post, interact and become more involved.

Good points,

I think you misunderstood what I said.

If they are providing information for free but requiring registration that is what I do NOT like. I am not saying I want to read the information and then pay for it if I think it's valuable. If it's information I want, and it's for sale I`ll buy it.

Nemo - Thanks for the info.

Gotcha. I understand.

It does seem counter-intuitive to register you for content they offer free regardless. Hmmm. I'll let you know of their rationale if/when they write me back.

Cheers,
Nemo