Tuesday, June 28, 2011

The Western Canadian Barley Teaser Rate

"a reasonable person's beliefs change according to the state of the persons knowledge."
Irving M. Copi, Carl Cohen, Introduction to Logic, 8th edition, p. 462

The Oracle of Ottawa does not know shit about farming! But he does know that although people may not always need oil and gas, they will always have to eat! People have always chided the Oracle of Ottawa for the "risk" he takes when picking and buying his own stocks... but when the Oracle of Ottawa contemplates the Western Canadian farmer planting his section in the springtime (One section = 640 acres = 1 square mile?) he realizes what risk is really all about! There have been times when the Western oil and gas producers have said "Let the Eastern bastards freeze in the dark!" But for the life of him, the Oracle of Ottawa cannot find a reference of any Western Canadian farmer ever saying " Let the Easterners starve in the dark!".

Real Power...

As stated in many earlier posts to this humble blog, the Oracle of Ottawa gets very nervous and alarmed when he see's venerable Canadian institutions come under attack and assault. The latest instance was just last week when the precedent was set by the Conservative government of employing "Final offer arbitration"
in the solution of large labour disputes. Totally irresponsible talk of changes to the Canadian Senate is absolute red meat to the base at home, but in reality, it is a reckless play with the fires of chaos. Another institution that has come under attack is the Canadian Wheat Board. Now even to an Ontario city slicker, this is scary talk.
More powerful than nuclear weapons?

When the Oracle of Ottawa hears the likes of Ezra Levant pinging off of the CWB on Sun News TV, you have to start to worry. Who is who lobbying for now? When you have a Prime Minister saying that Canada is going to be a "world power" and then threaten to close down the CWB you got to start wondering about imbalances on axis three and four... Canada is a G8 country. There is no way that we can field a million man army in the field like India or China can. But we can decide who gets to eat! That is more powerful then all the armies in the world! During the cold war this power of the grain bin allowed Canada to punch way beyond its reach. Why would we abolish the one true lever we as a nation  have in geopolitical world power?

Heavens knows there are a few irritants with the CWB. And these problems are very repairable. But the guy in southern Alberta that can truck his barley to a mill in the States and get "more" money is a compelling story. But what about the guy in the northern parts of the western provinces? Will that "teaser" barley price still stand up when the CWB is gone and you have to deal with Cargill, ADM, and Monsanto? Will it really? I doubt it!

Canadian Wheat Board, A global brand!

But you western farmers can prove this to yourself. Call your provincial MLA and ask him/her if the western provinces can buy or rather assume the CWB from the Federal government? They want to get rid of it don't they? Now call your Federal member of Parliament and ask the same question... Well go ahead... No answer, that is strange... Beware the the Barley Teaser Rate!

What else would you close with? All the best to the farmers out west.

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