I was promised a lot of things when I was a kid back in the 60s. I was told that I would have my own personal robot to serve me lunch. I was, they told me, going to be able to take a vacation on the moon or maybe even Mars. I was told I would have my very own flying car. I was told I would be able to fly from Chicago to Sydney Australia in an hour. I was told I’d have a talking computer that would understand human speech.
Only one of those things actually came true in my lifetime, the talking/listening computer that is generically called a “personal home assistant”, or specifically the Amazon Echo (often called Alexa after its wake word) and Google’s Assistant (sometimes referred to as Nest). I’m going to focus on the Echo because that’s the one I’m most familiar with.
These things are everywhere. Amazon has sold somewhere around 200+ million of these things. I think they sold about 70 million of them last year alone, and if sales trends continue it’s predicted the company will sell 130 million of them in 2025 alone. I know a lot of people don’t like them and are even suspicious of them. I mean we live in a world now where some poor woman ended up finding a photograph of herself sitting on a toilet that was taken by her vacuum cleaner ending up on the internet. But the fact remains that there are millions of these things out there and millions of people love them and even have come to depend on them for important reasons.
But there is a huge problem with the Echo and the others out there, and that is cost. Amazon sells these things at cost to keep the price down, and they are losing an absolute fortune. The company is losing billions of dollars on the Echo devices. The problem is that they require a massive and extremely expensive behind the scenes infrastructure to work. The devices themselves are, frankly, stupid. What makes them work are massive server farms, huge buildings packed with computers that do the actual work associated with operating these things. And Amazon hasn’t come up with a way to pay for any of it.
When the Echo program was conceived of, it was going to be a marketing tool. The Echo was going to be an advertising device and ordering system. It would remind you to buy coffee or dish soap or laundry detergent and you’d use the Echo to order more and things like that. Only it didn’t work out that way. In order to get people to accept these things into their homes Amazon had to make the a hell of a lot more useful than that. And they did too good of a job of it. They’re used as personal calendars, reminder devices, communications devices, entertainment devices, give reminders to take medication, play cooking videos, play fart noises, tell bad jokes.
And Amazon makes pretty much nothing off any of that.
Amazon makes huge amounts of money, true, but not even that company can afford to keep this going when it is losing literally billions of dollars on the project. The company has been laying off people working on the Echo devices and trying other cost cutting measures, but it’s losing billions and none of that is going to solve that problem.
I suspect Amazon would dearly love to shut down the whole program, but that would be a PR disaster. Despite the fact that a lot of people look at the devices with suspicion, a lot of people love the things, use them every day, and often use them in ways that help improve their health and safety. If Amazon were to just shut the whole thing down it would anger millions of people.
I haven’t done a Farm Catch Up in ages. I used to do these on a regular basis but I’ve been so busy with other stuff that I haven’t had time, so let’s see what’s been going on in the ag industry.
Rail Strike Still Possible
After union leaders, the railroads and the White House announced an agreement that would prevent a rail strike, I warned people that it was too early to do a victory lap. Union leaders may have accepted the deal, but it still had to be voted on by the union membership. Almost immediately one of the 12 unions involved in the talks rejected the deal, although a small one, and reports coming from out in the real world indicated that the rank and file of some of the other unions were not happy with the deal either. While the deal did give substantial pay raises and improved some benefits, it did little or nothing to fix the real grievances that the unions had, the biggest of which was the RR’s scheduling system which some employees called draconian and even downright sadistic. (I’ve read how the scheduling system works and if half of what I’ve heard is true, I would have quit the moment that system went into place. I won’t go into details, you can find that out yourself if do some searching for the railroad employee scheduling system.)
Now the Brotherhood of Maintenance of Way Employees Division Union (BMWED) the third largest of the unions involved, has rejected the deal, and we could be looking at a strike by mid-November unless the situation is solved.
The railroads have been having serious problems for decades, but you don’t hear about them because the media is too busy chasing after the latest celebrity gossip or bizarre conspiracy theory. Unless a catastrophe occurs, like a major derailment, you hear almost nothing about how the whole rail system has basically been falling apart.
What does this have to do with farming? A lot. A rail strike would cripple the agricultural sector of the economy. Ag businesses and farmers depend on the rail system to move bulk cargo like grain, beans, cattle feed, fertilizer, propane, fuel and many other products. Then add in everything else that is shipped… A rail strike would be a nightmare for all of us.
Fake Meat Markets Fizzle
Before I start this I should point out that I am not anti vegetarian or anything like that. My personal opinion is that we eat way, way too much meat to be healthy for us and we’d all be a heck of a lot better off if we could get people to eat more fruits and vegetables and less meat. But these fake meats are not the way to do it.
JBS, one of the three or four companies in the country that have a virtual monopoly on meat processing and distributing, announced it was shutting down its Plantera Foods division which was producing the “Ozo” brand plant based fake meat products, just two years after launching the company, because of disappointing sales. JBS says it will stay in the alt-meat business (that sounds better than ‘fake meat’ so I’ll go with that term) but not in the United States.
It isn’t just JBS that’s been having problems selling this stuff either. Sales of alt-meat products haven’t been doing so good. Beyond Meat’s stock value has plummeted. As of Sept.28 it’s stock value had fallen 75% this year. Sales of alt-meat products have falling by 10% in just this year along according to some data I’ve seen.
So why isn’t the stuff selling as well as they predicted? Impossible Burger and Beyond Meat’s products are supposed to be “healthy” and good for the environment and all of that and they’re supposed to be just as good as actual meat, so why aren’t people lining up to buy the stuff?
First is cost. Last time I looked the grocery store where we shop the Impossible Burger was selling for more than twice the cost of real hamburger. I haven’t bothered to look recently because frankly I don’t care, so I don’t know if prices have moderated a bit or not. What matters is that at most of the stores where I’ve found the stuff sell it for a lot more than regular hamburger 🍔 (Oooo, I just discovered that this goofy Macbook’s little status bar above the keyboard suggests emojis for me. Isn’t that just so – so useless?)
Second, the food industry as a whole has a long, long history of outright scamming the consumer and selling us garbage laced with salt, fat, sugar and artificial ingredients and labeling it not only as “food” but also claiming it is healthy. So people are justifiably skeptical of just about everything the food industry tries to tell us these days. If you read the list of ingredients on the Impossible Burger and Beyond Meat products, you will find almost nothing in that list that actually looks like real food. What you’ll find is a long list of chemical names, added vitamins, modified starches and other products that come out of the back end of a factory. There basically is nothing in that list of ingredients that I want to put in my mouth and I suspect a lot of people feel the same way after reading that list.
Third, these products just aren’t that good. I tried eating one of these things once, an Impossible Burger that I found in the freezer at the local grocery store. I made it according to the instructions and… Well, I’m sorry, I don’t see how anyone could ever mistake this stuff for actual meat. The texture and mouth feel was just -wrong. The aroma was extremely odd and the taste was, frankly, unpleasant. I couldn’t finish the thing. Slather it was ketchup and mustard and onions and I might have been able to choke it down, but eating it plain? No way. I’d rather eat a Bocca Burger. Still frozen.
As if disruptions with railroads and trucking weren’t bad enough, now the Mississippi River is giving us problems. A huge amount of product of all types is shipped on barges on the Mississippi River. Farmers and agricultural businesses in the midwest depend on river shipping to not only get grain and beans for export down to the Gulf of Mexico, they also depend on it to ship fertilizer, cattle feed and other products back up the river to co-ops, fertilizer distribution facilities and other businesses that sell bulk products to farmers. And thanks to scarce rainfall the Mississippi water levels are extremely low and barges are running aground. Reports are that water levels in the river system are at “historically low levels”. There are backups of barges at choke points on the river system. Barge loads have had to be reduced by up to 30% or more and towboats which usually push many barges at one time have had to cut the number of barges they can push. As of Oct. 4th the cost of shipping on the Mississippi had jumped up over 200%.
If you’re interested in actually watching shipping along the river, both barge and rail, there is an excellent live camera operated by Virtual Rail Fan in Ft. Madison Iowa that shows both the massive amount of rail traffic going across the Mississippi and a historic swing bridge across the river that has to open to allow river traffic to pass. The camera is on 24/7 and generally has a camera operator running it. In the spirit of full disclosure I should point out I am a VRF member and sponsor and you’ll occasionally see my name (No, not grouchyfarmer, my real name) listed on some VRF camera sites as a sponsor.
Why Are Egg Prices So High? Blame The Flu
I don’t know what it’s like where you are, but around here eggs are pushing up towards $5 a dozen. I was in a local grocery store three days ago and the price there was $4.79/doz. Why? Bird flu is at least part of the problem. Since February we’ve lost 47 million birds, mostly chickens and turkeys, to avian influenza in 42 states in the US. So between losses of birds to flu to increased costs for fuel, grain, labor shortages, etc, yeah, prices have shot up.
It’s affected chicken and turkey prices as well. Unless grocery stores use turkey as a loss leader you’re going to find a lot of families looking for a substitute for the traditional thanksgiving day turkey.
And that’s about it for now. I’m getting bored and I’m sure you are too. As always, comments are welcome. (Note: All comments are moderated and yours won’t appear until it has been checked.)
If you’ve followed this blog over the years you already know that I’m not a big fan of biofuels in general, and ethanol specifically. Since the ethanol blending mandates were first instituted, big agriculture, the government and the proponents of ethanol haven’t exactly been honest with us. Diverting a source of food for both people and animals, corn, into the production of fuel was never a good idea for anyone except, of course, the ag industry, its lobbyists, and the politicians they’ve bribed (cough cough, excuse me, slip of the fingers there) influenced to push ethanol fuel mandates. Ars Technica, of all places, has an interesting summary of the findings of a study just published last Tuesday in Proceedings of the National Academy of the Sciences.
The corn industry and ethanol industry, of course, immediately struck back by simply claiming that the whole study is, basically, a lie. And Monte Shaw, the head of the Iowa Renewable Fuels Association said he is “not interested in spending time on silly stuff like this“. So basically he is condemning the entire report without having even read the thing.
What the study discovered was that the biofuels industry is nowhere near as “green” as they’ve been claiming it is for decades. What the study showed is what a lot of people have been claiming for years now, that when all of the factors involved in the production of the corn used to make ethanol are added into the equation, ethanol is, at best, no better than using gasoline, it’s actually worse in some areas.
What’s ironic about the whole thing is that the whole ethanol fuel industry is doomed in the first place as we transition to EVs. Whether we like it or not the internal combustion engine is on it’s way out and is being replaced by electric vehicles. The ethanol industry can rant and rave all it wants, push for higher and higher percentages to be added to gasoline, and it all isn’t going to matter in the slightest because the market for the stuff is simply going to vanish along with the internal combustion engine.
Glyphosate, the generic name for the active ingredient in the herbicide RoundUp, is suffering from severe shortages, to the point where a lot of farmers aren’t sure if they’re going to be able to get any or not for the upcoming growing season. The manufacturer of a key ingredient has had a mechanical failure that’s shut down production. The product was already in short supply for several other reasons, most of them not related to the virus, I should add. The biggest problem was Hurricane Ida shutting down Bayer’s primary glyphosate production facility for an extended period of time.
There has been a sort of ‘perfect storm’ of garbage being dumped on farmers in the past few months and it looks like that isn’t going to ease up any time soon. It isn’t just glyphosate. There are shortages of fertilizers like potash and anhydrous ammonia causing prices to sky rocket. The craziness between Russia and Ukraine is causing fuel prices to increase, and putting pressure on the commodities markets because Ukraine is a major producer of wheat, sunflower seed, and rapeseed for canola oil. Prices on corn and soybeans are going up and up, which is great for the people who grow the stuff. But for dairy and beef farmers, it is causing serious problems.
What it all amounts to for us consumers is don’t look for food prices in the grocery stores to come down any time soon.
Meat Monopoly Rakes In Record Profits
If you wanted to have a nice ribeye or T-bone steak for your Superbowl party, you probably looked at the prices and once you got your heart restarted you settled for grilled cheese. Prices of meat, especially beef and chicken, have skyrocketed over the last two years, and it’s all being blamed on, of course, the virus. Or is the virus only being used as a scapegoat by the meat industry as an excuse to bring in record breaking profits?
Tyson, JBS and Nation Beef more than tripled their profits during the pandemic, despite claims that price increases were due to increased expenses caused by worker shortages and supply chain disruptions. They had a 120% increase in gross profits, and a 500% increase in net profits. And profit margins, the amount of money companies make over and above their expenses, have skyrocketed as well, with margins climbing to up to over 300% in some cases. If the price increases were indeed due to an increase in expenses, profit margins would remain flat because increases in profit would be offset by increases in expenses.
The entire beef processing system in the US is a monopoly, controlled almost entirely by four companies, Cargill, Tyson, JBS and National Beef. Chicken is controlled by Tyson, Pilgrim’s Pride, Perdue, Sanderson and Koch Foods. The situation is pretty much the same with Pork, with the biggest player there, Smithfield Foods (owned by, drum roll please, China) being the major player there, along with a couple of others. For all intents and purposes, the entire US meat production system is controlled by just a handful of multinational companies.
A Convenient Scapegoat
While I’m on the subject of the pandemic, let’s look at some other areas where it is being used as a convenient scapegoat to try to explain away problems and/or massive price increases.
Trucking – You’ve probably heard that there is a massive shortage of truck drivers due to the pandemic. That claim is only partly true. There is a driver shortage, yes, but it isn’t because of the pandemic. In fact, right now we have more registered CDL holders than at any time since trucking started. The fact is that trucking companies have never been able to hire enough truck drivers, and driver turnover rates are sky high. The problem is that driving truck is hard, frustrating work, laden with sometimes utterly ridiculous regulations in some areas and not enough regulations in others, and drivers are often abused, short changed and treated like garbage by their employers, and they don’t get paid very well either. I know one company out of Green Bay that keeps teams of drivers on standby to do nothing but fly out to pick up trucks abandoned by drivers who got so fed up that they couldn’t take it anymore and just left the trucks and walked away. I would imagine that most of the bigger companies have to do the same.
Ports – The ports in the US are really the main choke point here. The US has some of the worst ports in the industrialized world thanks to years of neglect and a failure to upgrade port facilities because that would cut into their profits. Like the trucking business, this issue with US ports actually goes back decades. While ports in Europe and Asia have been upgrading their facilities and making major investments in them, in the US little or nothing has been done to upgrade materials handling capabilities or to streamline operations. Even before the pandemic the US ports were just barely functional and were already causing disruptions in shipping. The pandemic just made an already existing problem worse and showed just how bad the situation was.
If you look at the drought map up there from https://droughtmonitor.unl.edu/ you can see that things look a bit, well, scary, really. Right now more than half of the country is under drought conditions that range from mild to extreme. For a while there it seemed the West might see some relief from what is, according to some climate researchers, the worst drought they’ve had out there in 1,500 years. But that situation seems to be changing and things are starting to get worse again. Water use restrictions are already in place in many places out there and more are almost certainly going to be instituted unless they get significant precipitation. Even here in Wisconsin we’re well behind normal for precipitation. Last I heard our snowfall amounts here were running 16 – 25 inches behind normal. I’ve only had to use the snowblower once so far this winter. Most of the snowfalls we’ve had, and we haven’t had many, have been a light dusting that we’ve dealt with using electric leaf blowers.
Of course weather is, well, weather, and things can change rather quickly, but I haven’t seen conditions this bad in a long time. The drought is one reason why commodities prices have been pushing up over the last few months.
Farmland Prices Climbing
Here in Wisconsin farmland prices have always been less volatile than in other parts of the country. Prices here haven’t gone up much since I sold the farm. But that’s changing. Here prices haven’t shifted a lot, but they’ve been moving up gradually. In other parts of the country, though, prices have gone a bit, well, bonkers, really. I’ve seen some sales where prime farmland was going for as much as $20,000 per acre, an amount that seems completely crazy to me.
One trend that I find extremely troubling is the entry of investment companies into the farmland market. This has been going on for a while now but they have been becoming much more active now and there seem to be new ones starting up every year. They buy up farmland, often outbidding actual real farmers for the land, then turn around and rent it back to the farmers. Not only is this pushing the sale price of farmland up and up, making buying land unaffordable for a lot of farmers, it is pushing land rental prices up as well as these companies will gleefully gouge farmers for every penny they can get, even if it means putting real farmers in financial jeopardy.
That’s it for this time.
Stuff Coming Up
I have all kinds of things that might end up in the pipeline that feeds this blog, whether any of it actually gets in here is something else again. One thing that will be coming up is a look at a bowl hollowing system for wood turners that I’ve been using of late. It’s been on the market for some time now but it’s new to me and I like it rather a lot.
It’s February and snowing outside as I write this so this seems like an odd time to be planning gardens and buying seed but that’s exactly what we’ve been doing here. We’re thinking of expanding the garden areas yet again, perhaps adding another raised bed or two, and making one of the in-ground gardens considerably larger. We’ll see how ambitious we get once spring gets here.
A note about seeds – if you haven’t already laid in your stock of seed for spring planting, you might be out of luck. I’ve been hearing of serious seed shortages, not just for home gardeners but also for nurseries which produce seedlings and bedding plants for the home gardening market.
I’ve been seeing a lot of ads popping up over the last few months for what are being called household emergency power systems that use batteries instead of the traditional gasoline, natural gas or diesel engine powered generators. Some of them are being called “solar generators”, even though they aren’t. A lot of the ads are wildly misleading, even outright lies. There are problems with all of these systems, whether you go with batteries or the more common gasoline or other fuel powered systems. So if I can work up enough ambition you might see a piece about that in the future.
Welcome to a new feature of grouchyfarmer.com which, I hope, will never be repeated but probably will because every time I look at the news it seems the human race is well on its way to stupiding itself into extinction. It’s called How Stupid Are We. And I’ll warn you right now this article got way, way longer than I intended. But let’s look at NFTs.
The acronym NFT has been popping up all over the place recently. I read a lot of articles in which they are mentioned, usually by people who seem to have absolutely no idea what the hell they are or how the whole system works. All they know is that they think they can make money off them. Somehow. Maybe.
As the headline up there asks, just what the hell is an NFT anyway?
Sidenote: Well, as a former writer and editor my first question was really “Is it ‘a’ NFT, or ‘an’ NFT’?”. Personally I think “an” should be used because the rule of thumb is that ‘an’ is used when the following word starts with a vowel sound, in this case ‘en’. But if you want to use ‘a’ yourself, hey, I’m not going to complain. Go for it. Just to mess with any grammar police out there, I’m going to use both.
A NFT is a non-fungible token. There you go. That clears that up, right? So let’s talk about wood or cows or photography or something really interesting…
Hm? No? It doesn’t clear that up? Yeah, I suppose it doesn’t. Let’s see if we can dig into this.
The dictionary meaning of non-fungible is that it is a thing that is unique. There is only one of them and there is no other thing that can replace it. The dining room chair I’m sitting on right now is fungible. It is not unique. There are five others just like it sitting around the table and I’m sure there are hundreds of others floating around out there.
However my van Gogh painting depicting a tiny mouse wearing antlers romping in the woods with drunken unicorns while a certain politician who shall not be named stoically suffers from severe constipation off in a corner behind a bush is, however, unique. It is non-fungible because, well, van Gogh is dead and can never make another one (thank God).
Side note: No, no, no! Not thatvan Gogh. I mean my old neighbor Coriolanus van Gogh. No relation to that van Gogh at all. Give Coriolanus a box of crayons and a case of beer and it would keep him busy for hours, but the less said about that, the better.
So when you buy an NFT you are buying a unique object that no one else can ever have?
No. A lot of people seem to have that impression, but you aren’t. You’re forgetting the “token” part of the term. A token is a thing that serves as a representation of another, entirely different thing. Let’s say we go out to the local bar and I buy you a drink but you’ve already had two (Well, this is Wisconsin so most likely you’ll have had six or eight) and don’t want another. The bartender at some places will give you a plastic or wooden coin that you can use later to exchange for a drink when you do want one. That’s a token.
When someone buys an NFT of a GIF, JPEG or video or something like that, they aren’t buying an actual thing, they’re buying a token that represents that thing and which, hopefully, maybe, ‘points’ to the actual digital representation of that thing so you can go and look at it or something. I guess. In this case the token is an entry in a kind of special database called a blockchain.
So wait, Gf, you say. You mean not only are these people are paying literally millions of dollars for a stupid GIF file of a cat horking up a hairball that’s been floating around the internet for the last 20 years, they don’t actually get, well, anything at all for their money, just an entry in a database somewhere that says they own a thing?
Well, sort of, yeah.
If it will make you feel better, please feel free to join me in banging your head against a wall to get rid of the headache this has possibly given you. It won’t make you feel any better, but it does help pass the time…
But before you start banging your head on the wall and begin to suspect that the human race is going to be the first species ever to stupid itself into extinction (it probably will but that’s fodder for a different article), remember these are special gifs and jpg and mp3 files. And these are special databases. We know they’re special because they call them blockchains and not databases.
Let me see if I can make this more clear. I probably can’t because all of this makes my head hurt, but let’s try anyway.
Now look at that image over there on the right. That is a digital representation of a painting I did many years ago called “The Dancer”. And I want to sell you the NFT of that painting for, oh, let’s say a hundred bucks
Come on, just play along here.
So, you say, GF if I buy that NFT you send me the painting…
Well, what, you ask, do I actually get for my hundred bucks then?
You get a token entered into a database that says I sold you an NFT of that painting. Period. I still have the actual painting, I still have the copyrights. What you own is an entry in a database somewhere that says I sold you the NFT of that JPG image up there, which I have stored on a flash drive laying on my desk. Unless the cat ate it, in which case it’s, well, in the cat but that’s the cat’s problem, not mine.
You’re free to sell the NFT, the token I just sold you, but the image itself? It’s still on that flash drive, in the cat. (Well, unless the cat pooped but I’m not about to go look. Ick. I’m not going to fish it out of the litter box.) I still hold all rights to that so you can’t do things like, oh, reproduce it in a book or something without paying royalty fees. To me. And the royalty fees are going to be steep because I want to buy a Cat D10 bulldozer and those puppies aren’t cheap.
But wait, you say, it’s a picture in this blog. Anyone can just do a screen shot of it and have a copy.
Ah, but only you own the NFT which says you own, well, the NFT which is, well, something, I suppose? Maybe? Kinda?
These NFTs we’re talking about here are all, oh, digital assets, let’s call them. They are GIFs of dogs trying to take a dump behind a bush, or alleged artwork in JPEG form or sound files or video files. Someone even bought a NFT of the very first Tweet for something like three million bucks, for God’s sake. Or what they were told is the very first Tweet. And ultimately what they own is, to be completely honest, nothing. Nothing except an entry in a blockchain that says they somehow “own” that particular asset.
I have no problem with buying and selling digital artwork or other digital assets. I personally do it all the time. I’m in Second Life where I spend time building environments. At the moment I’m building a sort of cyber/diesel/steam punk city with surreal elements like bits of kawaii culture, exploding penguins (seriously, exploding penguins. they’re great fun.) and other goodies. I do create my own stuff in SL but there’s no way I can build enough props, buildings, and exploding penguins in my lifetime in order to finish an entire city, so I buy stuff from other in-world builders. I sell stuff in SL as well, and some of my paintings and photos, (well, digital representations of them), are hanging on virtual walls or are on display in a few places in SL.
But when I buy something in SL, it is something I can at least use in that environment. It’s a bit of art. or a prop for a scene I’m creating, or a building that fits into the environment I’m making. When I buy something there I am buying the right to use the creator’s intellectual property in my own environment. With an NFT I’m not even getting that. All I get with an NFT is an entry in a database somewhere that claims I own that NFT. Period.
Now if you’re starting to think this all sounds like some kind of scam designed to separate people from their money, you aren’t the only one. Personally I agree, and there are a lot of people out there who feel the same way.
Supposedly you are buying the original “thing”, whatever it is. But if you stop and think about it for a moment, there literally is no such thing as an “original” object when it comes to a digital asset. It isn’t like a painting where there is only that one, single physical object. In the digital world everything is a copy. Everything. That’s how computers work. Look at this letter “T”. Within milliseconds of my typing that letter it ceased to exist and became a copy as the pattern of bits that represent that letter were copied from the keyboard’s buffer memory into the computer’s cache memory to be stored in main memory and and the “original” pattern of bits in the keyboard’s buffer was destroyed. Then a video system looked at that copy and saw that pattern meant it needed to put a “T” in that location on the screen and made another copy of it, and then the system realized I’m writing an article so it made a backup copy just in case, and some of that data was then stored on the SSD drive in this computer, which was then backed up, and then it realized the section of the SSD where it was storing that “T” was getting full so it made a new copy of that “T” in a new location and erased the old one to recover the space… You get the idea.
The person who bought the “original Tweet” bought no such thing because there is no original. By the time the sender of that original Tweet hit the send button, it was already a copy of a copy of a copy of a copy of a… You get the idea.
Here in the real, tangible, physical world, there are “original” objects, there are non-fungible objects. They have a physical reality. In the digital world, in the “metaverse” (dear lord I hate that term), in the “virtual world”, there is no such thing as an original copy of anything. The very nature of how computers work make the concept of an ‘original’ impossible because in the act of creating something even the artist or creator of that thing is always working with a copy and the ‘original’ is destroyed in the process of creation as patterns of bits are moved around in computer memory and data storage spaces.
The whole concept behind these NFTs is fundamentally flawed from the beginning.
And then we come to blockchains. What makes the whole NFT thing possible is, of course, the blockchain, a mysterious and astonishingly complex bit of code that creates a supposedly immutable, permanent transaction record of every movement of an asset in the system. If you start to look into the technical details behind a blockchain you will find yourself quickly wandering off to watch cute cat videos on YouTube out of sheer boredom. Now I know, sort of, how blockchains work, but if I started to try to explain it completely it would take me about, oh, five days just to write down the basics before I even got to things like decentralization, the different types of forks, genesis blocks, orphaned blocks, nodes, wallets, signatures, encryption, hashing… Sorry, I just can’t be bothered. Far better writers than I have tried explaining it to non-tech people, so I’ll leave it up to you to do your own digging.
But to get back to NFTs, what can I say? Let’s just say George C. Parker would have been proud if he’d come up with this scam.
I’ve heard NFTs being called a reimagining of the old “pump and dump” stock scam. Some NFT owners are selling their own NFTs to themselves in the hopes that the transactions being generated will make people think they are valuable so they can dump them on someone else. I’ve heard others claim that when following the “chain” to try to find the actual digital object the NFT is linked to, most of them don’t actually exist at all. Someone else said that nfts are only valuable as tools for money laundering, tax evasion and fraud. Scammers are outright stealing artwork from legitimate artists and selling them as NFTs. From one end to another, the whole NFT system is little more than a great, steaming pile of sh*t.
So, hopefully this has taken a confusing subject and helped to make it even more confusing.
Well it was a wild ride on the commodities market this past week as corn hit $7.40 and soybeans hit $15.71. We haven’t seen prices like this in something like ten years or more, and a lot of people are puzzled by why the commodities prices have spiked up this high, this fast. There are no natural disasters or reports of extreme shortages that would cause this, so what’s going on?
It’s a combination of things that have made the markets a wee bit nervous. China is trying to rebuild its pig herds after they were decimated because of culling from African Swine Fever, so there is increased demand there. There are weather problems in parts of South America that are interfering with some corn production down there. USDA announced that US farmers are going to plant less corn this growing season. The reduction isn’t much, but enough to make people think it might make supplies tight. They think people are going to be driving a lot more this summer which is going to mean increased demand for gasoline which, in turn, means more demand for ethanol to meet the blending requirements.
So here we are with corn at 7.49 at the moment. Extended out into the future commodities prices get more reasonable, but not by much. July corn is sitting at 6.73 which is still high but not utterly horrible, and September corn is at 5.92
So, why should you be interested in corn prices? Because volatility in corn prices ripples through the whole economy. High corn prices mean it costs a lot more for the dairy, beef, chicken and pork producers to feed their cattle. That’s going to put pressure on consumer food prices across the board, not just dairy products and meat. High corn prices can force producers to look at other grains like wheat to substitute. That can push wheat prices up, increasing costs for flour, which increases the cost of baked goods. Well, you get the idea.
It also puts pressure on fuel prices. The government mandates that refiners blend a certain amount of ethanol into their fuels, and in the US the majority of that ethanol is made from corn.
Now the markets can absorb some of these increased costs, but not a lot and not for long, and sooner rather than later it’s going to result in increased prices on consumer products. So if corn prices stay this high for much longer, you’re going to see that rippling out into increased prices on food, fuel and other products that you buy yourself. Some companies like General Mills and a few others have already already announced that they’re going to have no choice but to start raising consumer prices. Wholesale beef prices have gone up about 33% already this past month.
And it isn’t just food. Just look at the craziness going on with lumber. And speaking of lumber…
What The Hell Is Going On With Lumber?
That’s a question a lot of people are asking because lumber prices have gone nuts. Prices on lumber have spiked up around 360% in just the past year. That is not a typo. 360% in one year. I was paying under $2 for 2×4 studs last year, now that’s up to around $7 each. MrsGF and I have pushed back plans to do a few remodeling projects here at the house because not only have prices skyrocketed, it’s hard to get materials even at those prices. I talked to one contractor who builds houses. he bid on building one house late last year at $350K and now the same house would be closer to $450K.
Why this abrupt spike in prices? It isn’t because there’s a shortage of trees or something like that. Nor are the people growing trees getting the money. They’ve seen only a 2% increase in the price they’re getting for the logs. It’s all the haulers, sawmills and processors in between that are the cause.
The claim is that it’s being caused by a labor shortage. They can’t find truck drivers, workers at sawmills, tree cutters, etc.
Herbicide and Plastic Shortages
As if corn and lumber prices weren’t enough to worry about, we’re also seeing shortages of herbicides, insecticides, fungicides and, believe it or not, plastics. Farmers are having trouble finding things like field drainage tile and the plastic wrap used to protect bales. There are reported shortages of glyphosate and some other herbicides, some fungicides and insecticides that are used to prevent weeds and protect crops.
What this all adds up to is considerable pressure to increase prices. Someone has to pay for all of these increased costs and in the long run that’s going to be us, the consumers. How bad those increases will be, well, I have no idea. It is going to depend on how long commodities prices remain high and how much of the cost increases the industry is willing to absorb before they have to raise prices. As I said earlier in this, a lot of companies have already announced price increases.
Dairy Pride Act
So, let’s talk about plant based “milk”. I didn’t really want to talk about things like almond milk and all that, but it’s in the news again thanks to the Dairy Pride Act being pushed by Sen. Baldwin from Wisconsin and a few other politicians.
The whole problem revolves around that one word, milk, and how it is defined. There are two real definitions of the word, one biological, and one legal. Biologically speaking milk is the scrections of the mammary glands from mammalian animals and which are used to feed their young. The legal definition is, well, here’s a direct quote from federal government regulations:
“Milk means the lacteal secretion, practically free from colostrum, obtained by the complete milking of one or more healthy cows, which may be clarified and may be adjusted by separating part of the fat therefrom; concentrated milk, reconstituted milk, and dry whole milk. Water, in a sufficient quantity to reconstitute concentrated and dry forms, may be added.”
You will undoubtedly note a lot of problems with the above. The most glaring problem is that it claims milk only comes from cows, ignoring the fact that goats, sheep, horses, oxen, even beavers, give milk. (Mmmm, beaver milk. Yum. Wasn’t there an old Monty Python joke about Peruvian beaver cheese?) (Sorry, my mind just flashed up an image of a farmer trying to milk a beaver. That’s just the way my brain works. It scares me sometimes. My brain, not beavers.)
So, here’s the problem. For years now certain companies have been selling nut, grain or bean based liquids as substitutes for dairy milk and calling the stuff milk. This is, technically, illegal. The US has very strict labeling requirements when it comes to food, and the government has gleefully gone after a host of companies and individuals who mislabel their products. But not when it comes to this stuff. For whatever reason the agencies responsible for food labeling accuracy have blithely ignored the mislabeling of these products, despite a considerable amount of pressure from the dairy industry to do something about it.
Now you might think this whole thing is silly, and you do have a point. But on the other hand the anger of the dairy industry is understandable as well. The dairy industry has spent many, many decades and hundreds of millions of dollars in advertising, propaganda, health claims, puffed up PR campaigns and other efforts to try to make its products appear to be healthy, good for you, pure and wholesome, and even essential. And then along come these upstarts trying to cash in on all of the work the dairy industry put into making milk look good, and claiming that their products are “milk” as well, and, well, they’re pissed.
Legally speaking, the dairy industry has a valid point. This stuff does not meet the legal definition of “milk”. US food labeling laws, if strictly interpreted, should make the labeling of this stuff as “milk” to be illegal. But the court system doesn’t seem to see it that way and has let this continue, so, well, here we are then.
Politicians from large dairy states like Wisconsin are upset about this as well because, well, let’s be blunt here. The only reason they’re upset is because the dairy industry is paying them to be upset. The dairy industry pumps huge amounts of money into the coffers of these politicians and their PACs. The result is this Dairy Pride thingie which basically says that you can only label actual milk as milk.
Will this actually go anywhere? I have no idea. If it passes, will it help the dairy industry? No. Won’t do a thing to help the dairy industry. Will it hurt the fake milk industry? Probably not. They’ll just come up with something else to call their stuff, pump a few more bucks into their advertising budgets, and that will be it.
Now, let’s see, what else did I want to babble about? There was some more stuff… Oh, amateur radio! Gads, almost forgot about that.
My OCFD (that’s an “off center fed dipole” for you non-radio people out there, a kind of antenna) came down again. That is a long wire antenna, about 130 feet long in total. It had snapped before and I’d repaired it and put it back up, but it snapped again now, so I figure that years of hanging in the air and flapping about in the wind has caused metal fatigue or something in the wires, so I didn’t bother fixing it again. It’s going to come down and I already have another one on order. Why not build my own? I could, but I did mention about the lazy thing, right? Why build one when I can buy one that’s probably going to be better than I could make myself.
Meanwhile I’m using a GAP Titan DX vertical antenna which has turned out to be way, way better than I’d hoped. I’ve had that one up for some time now and it works amazingly well. I had contacts with 3 Japanese stations in the space of about 10 minutes yesterday afternoon using less than 100 watts output, plus one or two in Europe and in other exotic places like Texas, New York, etc.
My woodworking and wood turning has come to a screeching halt recently because I’ve been spending a lot of time out in the gardens hauling compost, tilling up stuff, etc. We got the onions and garlic in but it’s still too early to put anything else out. The weather hasn’t exactly been warm here except for two days when it was in the mid 80s. Generally it hasn’t gotten much above 50 here, with night time temps pushing down into the mid 30s or even a bit lower. That hasn’t kept the tulips from blooming though as you can see from that photo up there.
But back to wood working to wrap this up. I really enjoyed making decorative lamps with resin and wood and want to do some more of those, so I’ve got more resin on order and that should be coming this week yet. The few “jumble” pieces I did as experiments with odd bits of wood cast into resin, well much to my surprise people really seem to like those for some reason so I’ll probably do a few more of those. But what I really want to make are more decorative lamps. Anyway, more about that when I get into that.
Corn futures prices have been flirting with $6 for weeks now and prices finally pushed over that line when I got up this morning and started reading the news. As of right now May corn is sitting at $6.32. Soybeans were up to $14.78 and I wouldn’t be too surprised to see it hitting $15. We haven’t seen corn prices this high in a long time. If I remember right we haven’t had prices this high since we had a serious drought quite a few years ago.
While high corn and bean prices are good for the farmers who grow the stuff, they’re bad for just about everyone else, and if prices stay this high for more than a short time it is going to have effects that will ripple through the whole economy. Dairy farms are starting to cull their herds already because of high feed prices, as are beef ranchers and hog operations. That could potentially result in higher food prices for you and me. It could put more pressure on wheat, forcing that up causing increases in prices for anything that uses cereal grains like bread. It could even cause significant increases in fuel prices.
Holy cow it’s been cold up over here in Wisconsin for the last few days. As anyone who’s lived in Wisconsin for more than a few years can tell you, we’re all a bit paranoid about weather up here, and for good reason. We all figure Mother Nature is a sadistic b**ch and is out to get us. She lulls us into a false sense of security with a period of abnormally nice weather, and then BAM, she nails us with something nasty.
So after a couple of days with temps up in the high 70s a few weeks ago, she brought the hammer down and nailed us with icily cold weather ever since, with nighttime temps dropping down to the mid-20s and daytime temperatures rarely getting above 45 or so. We’ve had light snow for a few days, including last night. They had a bridge or two in Green Bay closed for a while because of icing.
So it’s a good thing we finally got the new windows in eh?
This project actually started late last summer when the storm window in the office was literally sucked out of its frame during a high wind. Turned out that what we thought was a solid window frame wasn’t so solid. It had been slowly rotting away behind the paint so we didn’t know how bad it was until the damage was done. So we decided to replace all the office windows and the one in the dining room.
Now usually it doesn’t take long to get new windows made, a week or two at the most. But we hadn’t taken into account the fact that 2020 was far from a normal year. Between shortages of construction materials, disruptions at the factory from sick or quarantined employees and everything else, it was mid November before the windows finally came in and by that time the weather was so bad we couldn’t do the installation.
Anyway, they’re finally in, look good and our contractor, Russ, did his usual excellent job dealing with the situation.
We’d been considering remodeling the main bathroom as well, but we’re going to be putting that off until next year because Russ told me he’s not sure he can even get the stuff we want in any kind of reasonable amount of time. He’s had a bathtub/shower unit on order since January for another job and that won’t be coming in until June. So we’re going to wait until things calm down a bit before going forward with that project.
Friends and family know that I’m always looking for interesting bits of wood, so MrsGF’s sister and her husband showed up this weekend with this in the back of their van, some neat looking boxelder from a tree they took down a few weeks ago.
Boxelders are considered a weed around here. They’re extremely invasive, tend to grow fast and die young, and the wood isn’t really good for much. Even healthy looking trees will turn out to be rotting away on the inside. But I’ve seen some really spectacular pieces turned from boxelder so I’m looking forward to tackling this stuff. Some of it looks really promising with some spalting and interesting coloration.
One of the fun things about wood turning is you can put just about anything on that lathe. You don’t need expensive, furniture grade wood to end up with a nice bowl or art project. In fact, some of the nastiest looking stuff that you’d think should end up in the fire pit can end up making some of the most spectacular objects you can imagine.
I do most of the writing and photo stuff for this blog on a 10 year old Macbook Pro that lives on the kitchen table. It gets used a lot. And it is starting to show its age. The keys on the keyboard are chipped, worn and cracked, the LCD display is exhibiting, oh, I suppose you’d call it ghosting. If I bring up a white page like the editing screen for this blog, I can still sometimes see shadows of images that the screen had been showing before. Anyway, I figured it’s time to replace this thing before it just up and dies on me.
Once upon a time what to buy would have been simple, I’d just buy another Macbook. I’ve always liked Apple’s laptops and I’ve had two or three of them over the years. But… Well, Apple’s been having some problems, hasn’t it? There was the infamous keyboard problem with some Macbooks. There have been display issues, battery issues, rumors about problems with SSDs… The latest is that some models of the Macbook had bad cables connecting the LCD display to the computer.
And then there is the price problem. Apple equipment has always been expensive. And what you get for that price — well, Apple’s computers have never exactly been “cutting edge” when it comes to the capabilities of their computers. The hardware stuffed into those fancy cases might be good quality (most of the time), but the actual specifications of that hardware are mediocre at best.
What I ended up with, well, okay, what I ended up with is a bit overkill for a computer that’s probably only going to be used for doing email, writing and reading stuff. (A bit? Ha!). It’s a 17″ MSI GE75 with an i7 6 core processor clocked at a bit shy of 3 gHz, 32 gb RAM, a GeForce RTX 2070 and a 1TB SSD. So, well, yeah, it’s a bit overkill. But on the other hand I got a really good deal on it and it was a lot less than even a low end Macbook Pro would have cost me.
I needed something with some horsepower because eventually it’s going to be used to run Adobe CS to edit photos and videos, and while I don’t do actual gaming any more I do play around in SecondLife and need something with a fairly high end graphics.
Anyway, more about that in the future. Maybe.
That’s about it for now. Hopefully we’ll be getting some decent weather soon so we can get out in the gardens and I can get out on the bicycle. Trying to get on the bike when the temperatures are in the 40s isn’t exactly a lot of fun.
Some readers managed to discover Grouchy Farmer’s super secret email address and have been sending in questions. (What, you don’t know what it is? Here’s a hint: firstname.lastname@example.org) So I thought I’d better deal with some of the stuff that’s been piling up over there.
I heard almost the entire US meat industry is controlled by just three or four companies. Is that right?
That is true. About two thirds of the beef market is controlled by just three companies, JBS, Cargill and Tyson. Add in National Beef and those four companies control 80% of the beef produced in the US. The same is true with pork and poultry. Three or four companies control almost the entire market for both of those products as well. And all of these companies have a long history of, oh, let’s call it shenanigans, shall we? All of these companies have a history of being accused of price fixing, collusion to manipulate markets, abuse of employees, supply manipulation, and, well, the list goes on and on. And in some cases not just allegations, but outright actual criminal activity. JBS took corruption to a whole new level in its home country of Brazil where it was involved in an enormous bribery scandal that involved hundreds of politicians, meat inspectors, etc. Run a Google search on “JBS bribes meat inspectors” and you’ll probably be astonished at the depth of the corruption, and disgusted by the other less than ethical things JBS is accused of participating in.
How is this happening? Don’t we have antitrust laws to prevent this kind of thing? Yes, we do. Laws that the government ignores whenever it feels like it. Antitrust laws intended to prevent monopolies from developing have been conveniently ignored for decades now, with the government either carving out loopholes for certain businesses/industries, or simply ignoring the laws entirely. Why? Because the big multinational monopolies pump millions of dollars into the campaign coffers of influential politicians in Congress who, in turn, pressure the officials who are supposed to police this into looking the other way. Or in the case of JBS, bypassing the clumsy “lobbying” and just passing actual suitcases full of money to people.
Are dairy farmers really being forced to dump milk?
That is also true. I’ve heard estimates that dairy farmers are dumping something like 1.2 million or more pounds of milk every day because they can’t sell it. About half of the milk produced doesn’t go into products sold directly to consumers, it sells to food service operations, school districts, restaurants, or processors that use the products to produce still other products. So when the virus hit and most of those operations shut down or were severely limited, dairy farmers lost almost half of their market literally overnight. While consumer demand did indeed go up because of an increase in usage of dairy products in the home, the institutional type products are in forms or packaging the consumer can’t use. The production facilities that make consumer dairy products were overwhelmed with high demand and weren’t able to keep up, resulting in temporary shortages in some areas. So we have a bizarre situation where farmers have to dump milk while there are shortages of some products at the same time because production facilities can’t keep up or can’t quickly convert over to making consumer products.
When you made that “doomsday” flashlight, why did you have to put a resistor in-line with the LED? Why not hook it up directly to the battery?
It would be nice if we could just hook an LED up to a battery or power supply and switch it on without having to worry about it, but, alas, you can’t. (Note: There are some types of LEDs that do not need a current limiting resistor because they either already have one or because the type of LED can deal with the current, but most do require one) You often need a resistor in-line with the LED to prevent it from drawing too much current and burning itself out. The amount of current flowing in an LED is a function of the voltage across the LED. And in an LED the relationship between current and voltage is not linear. A slight increase in voltage can result in a large increase in current. So if you have an LED that wants, oh, 2.7V for example, and you feed it 3V, that can result in a large increase in the current in the LED, overdriving it, causing it to heat up, burn out, or even, in rare cases, explode if the current gets too high. So that resistor is there to drop the voltage in the circuit down to a level that the LED likes.
How do you figure out exactly what size resistor to use? I could go through all of the explanations about forward voltages and all of that, deal with the math and stuff, but it’s a heck of a lot easier to simply point you at someone who does a heck of a lot better at explaining things than I do. It’s pretty simple really. Don’t let the math spook you. It’s very simple to figure out. You can find a detailed explanation of why resistors are needed with LEDs and how to pick the right size resistor over at https://www.evilmadscientist.com/2012/resistors-for-leds/ There are even calculators (free) on-line where you just have to plug in some numbers and it figures out the size of the resistor that you need.
Your resistor doesn’t need to match the calculations exactly, either. If you don’t have one exactly the right size you can pick one that’s a bit bigger than the one the calculations indicate. I picked a larger one than I needed to reduce current draw so the batteries would last a lot longer while still letting the LEDs give enough light to be useful
What happened to the Great Radio Receiver Fiasco Project?
Ah, that. I was afraid someone would bring that up. It did not go well, mostly because of a parts supply problem. First the ferrite rods I’d ordered arrived almost crushed into powder. Then the toroids I’d ordered for coils, after about four weeks of waiting, abruptly were listed as “unavailable” from all three of the suppliers I’d ordered from. Then the tuning capacitor I’d salvaged from another radio turned out to have serious problems and a new one would have cost me almost $40. Anyway the whole thing is on hold while I look at alternatives or really scale back the design. Or just give up. I wanted to build a multiband receiver that would cover just about the entire HF spectrum from 80 meters to 10 meters, and, well, we’ll see. I built a few very simple two or three transistor receivers that sort of, kinda, almost worked, if I kept my fingers crossed, did a little dance and hooked ’em up to my 140 foot wire antenna to be able to receive anything. One I did was supposed to be an AM band receiver and when it picked up anything at all it turned out to be receiving transmissions from a train switching cars in the small rail yard a half block from here. Still haven’t figured out what the hell that was all about. Either my receiver was ridiculously screwed up, or the transmitter the railroad was using was ridiculously screwed up. Or, perhaps, it was aliens.
Are people really attacking cell phone tower technicians in Europe and trying to destroy radio towers, or is it just more clickbait? WTF is going on?
Unfortunately, those stories are all too true. It seems to be the worst in the United Kingdom, but it’s spreading everywhere. In the last two weeks or so alone, in the UK there were 30 incidents of cellular towers being attacked, usually by arson, and almost 200 cases of technicians being abused and even physically attacked, including one having a brick thrown at his head and another being stabbed. And it seems to be spreading almost as fast as the damned virus, fueled by bizarre and utterly ridiculous conspiracy theories, and spread by so-called “celebrities” who aren’t exactly the brightest bulbs in the pack to begin with, and by the anti-vax crowd. And it’s being spread everywhere by social media services who are more interested in raking in as much money as possible than they are in preventing people from using their services to push out insane conspiracy theories and promote violent behavior.
Anyway, that’s about enough of that. Time to wrap this up.
I haven’t done one of these in a long time so I thought it’s high time I took a look at what’s happening in the agricultural world. Especially now because the situation is difficult, to put it mildly. Well, not exactly agriculture directly in this article. I want to try to explain why we’re seeing empty shelves in the grocery stores when we actually don’t have any real shortages of product.
We all know that when this started almost immediately stores were stripped bare of sanitizer, sanitizing cleaners, hand soap, protective equipment like masks and gloves, etc. This was followed by store shelves being stripped of toilet paper, paper towels, and then food products, especially staples like rice, beans, flour, canned foods, butter, etc. And, oddly, even things with short shelf life like milk and cream. (Why in the world would people who almost never drink milk in the first place suddenly need to buy gallons at a time? I have no idea.)
But despite the bare shelves there are no real shortages, at least not of consumer food products. There are several factors behind the empty shelves you’re seeing in the stores. Hoarders (how much hoard could a hoarder hoard if a hoarder could hoard hoard?) and profiteers are behind some of this, of course, but the biggest disruptions are due to the way our manufacturing and distribution systems work.
We have what amounts to two almost entirely separate production and supply systems. The first is the consumer system that makes and sells product to you and me. It provides products that individual consumers want, in relatively small quantities that are suitable for individuals or families. The second is the commercial system that sells in bulk quantities to institutions like restaurants, schools, hospitals, prison systems, etc. and industrial processors that use those products to make still other products, like the processed food industry.
The result of this system is that we are in a rather bizarre situation where we have surpluses and shortages, of exactly the same products, at exactly the same time. Dairy is an example of this. Even while a lot of people are reporting shortages of milk and grocery stores putting strict limits on how much milk people can buy, we have such a surplus of milk on the supply side that a lot of farmers are dumping the stuff down the drain because they can’t find a processor to buy it.
So how the hell can you have a shortage and a surplus at the same time?
Well, we have a situation where most schools are closed, most restaurants are closed, a lot of businesses are closed, and a lot of people who would normally be at work or at school are now stuck at home. This means that meals that normally would have been eaten at school, work cafeterias, food trucks, restaurants, etc. are now being eaten at home. (About 50% of the money we spend on food here in the US is spent on meals eaten away from home.) Which means people are buying a lot more groceries, and more milk and dairy products in general for consumption at home. Add in the hoarders who, for some reason, think they need to buy six gallons of milk at a time (seriously, I’ve seen people doing this) despite the fact it will go bad long before they’ll ever use it, and it puts pressure on the whole distribution system delivering milk to grocery stores.
At the same time, schools are a major buyer of milk for the school lunch program, and they are largely shut down. As are restaurants.
So at the consumer level, the grocery store part of the market, we’re seeing increased purchases of products, while at the same time on the commercial side of things we’re seeing a dramatic loss of sales of similar products. So we’re having both shortages and surpluses, at the same time, of the same product.
Why not switch the commercial production facilities to produce for the consumer market? Well, you can’t. Production facilities used to make the half pint cartons for the school lunch program can’t be switched over to making gallon jugs for grocery stores. They use entirely different manufacturing and bottling equipment. The same is true for other sectors of the market. Attempting to switch from production of products for institutional and commercial markets to production for consumer markets is extremely difficult and very expensive. By the time a switchover could be done, the pandemic situation will have subsided and manufacturers will find themselves with manufacturing facilities that are now set up to make the wrong product.
Instead of dumping milk make cheese out of it? Can’t do that either. Cheese makers were already running at nearly 100% capacity even before this started. And even if there was the capacity to produce cheese, there isn’t any market for it because the cheese market is saturated to begin with.
The same is much the same with other products. The products are there, but those products aren’t in a form consumers would accept because they’re intended for the institutional or commercial market and are available only in bulk or in a form consumers don’t want. Toilet paper is a good example of this. While there are shortages on the consumer side, there is a glut on the institutional side of the market. With schools and a lot of businesses shut down, sales of TP for those markets has dried up. But the TP intended for that market would be entirely unacceptable for consumer use. The rolls are too big, or in sizes that wouldn’t fit a home TP holder, or the quality… Well, if you’ve used a restroom in a school you know what a miserable excuse for toilet paper that stuff is.
I have to mention the distribution system, too. Most companies, including grocery stores, switched to what is generically called a “just in time inventory” system long ago. That means that stores don’t stockpile product. You won’t find back rooms chock full of TP or canned goods or whatever at your average store. The store orders only enough product for a very limited amount of time. If they get deliveries every, oh, three days let’s say, they will order only enough product to deal with three days worth of normal sales. Why? Because storage costs money. Adding square footage to a store not only increases its build cost, it also increases its property tax bills, heating and cooling costs, electric costs, etc. So space devoted exclusively to storage of product is kept to an absolute minimum.
Normally this system works fairly well. But these aren’t normal times, so when a store gets hit by abnormally high sales of specific products, well, the whole system falls apart fast. When the panic buying started, grocery stores would see an entire day’s worth of a product sold out in an hour. Seeing the empty shelves spooked other consumers, who immediately panicked and started cleaning out the shelves of other products. Stores would restock as fast as they could, only to burn through several days worth of product in just a few hours thanks to panic buying.
If the distributors had an adequate inventory on hand it wouldn’t have been such a big problem. But they didn’t either. They were using the “just in time” system too, and were only stocking enough product to support their stores for a limited amount of time. Those stocks were depleted within days, and they were scrambling to get product from the flour mills, dried bean distributors, rice distributors, etc. to try to restock. The mills and packaging companies had more than enough bulk product on hand, but their packaging facilities couldn’t increase production beyond a certain point. Basically the entire distribution system began to fail under the strain of the panic buying and the increase in consumer sales.
The system is, finally, starting to adapt, at least around here. But as for what’s going to happen in the future, well, that’s anyone’s guess.
Since I’m already in a bad mood, let me rant a bit about this whole Foxconn fiasco. I’ve talked about this before going back to 2018, with a couple of brief mentions being tossed into other posts. Basically the situation is that no one seems to know what the hell is Foxconn is up to, not even Foxconn. Anyway, I thought that with the factory supposedly to open in May, this would be a good time to revisit the whole thing.
If you want some background on the situation click that link up there and it will take you to the original item I wrote back then. Go ahead. I’ll wait. (hums ‘Singing in the Rain’ and a few other showtunes)
Ah, good, you’re back. Let’s see what’s going on now, shall we?
The basic answer to that question is that no one seems to know what the hell is going on down there at the Mount Pleasant site. They’re building a factory. Maybe. I think. But what that factory is going to produce is anyone’s guess. No one knows. Certainly not the town of Mount Pleasant itself which borrowed so much money to upgrade the infrastructure around the facility that the inhabitants of the town will probably be paying off that debt for generations to come. Channel 12 in Milwaukee tried to do a story about what was going on with the town a while back, only to have the president of Mount Pleasant literally hide behind a door to try to avoid having to answer reporter’s questions, and their reporter being thrown off the factory site by local security.
Not even Foxconn seems to know what the hell they’re actually building down there. A half dozen different stories about what the company is going to build there, if anything, have come from company spokespersons since this all started, and none of them have anything to do with what the company said it was going to do when they signed the original contracts.
The latest that I heard before the pandemic hit was that they were going to make…
Wait for it… You aren’t going to believe this.
Drum roll please….
Coffee machines for airports.
Seriously. They were going to make, they claimed, automated coffee kiosks for airports according to a story in Milwaukee Business News.
Now that story has changed as well and now the company claims it’s going to make – ventilators for hospitals?
Look, I don’t care how “nimble” a company may be, but… Come on, this is all BS. I’m sorry, but it is. What the hell, exactly, is going on in that building down there in Mount Pleasant? You can’t build a factory specifically to produce flat panel displays, and then suddenly, overnight, decide you’re going to make coffee machines in it. Or then turn around and claim that within just a few weeks you’re going to take your alleged coffee machine/LCD display/whatever factory and start cranking out hospital grade ventilators. Making changes like that would require retooling the entire factory, reprogramming robots, building or buying new equipment, retraining employees. You’re looking at months of lead time plus tens of millions of dollars to retool and, no, ain’t gonna happen.
Well, not that they have many employees to retrain. The 13,000 employees they were going to hire seems to only be about 550.
But let’s ignore all of that for a moment and take a look at the other buildings the company bought here in the state..
Since the company signed the deal it made a huge PR stunt out of buying buildings in Green Bay, Eau Claire, Racine, Milwaukee and Madison. The one in Milwaukee was to be it’s “Wisconsin headquarters” and the others were to be some kind of “innovation centers”. There were big press conferences and media events to publicize the purchases, with the company announcing grand plans for – for something. It was never made clear exactly what they were going to do with the buildings, but it was going to be really, really important.
And absolutely nothing has been done with any of the buildings. At least nothing related to Foxconn itself. It’s been a year or more since the company bought them and they are still sitting empty. The company’s “Milwaukee headquarters” is a seven story building, and it is completely empty except for a bank that leases the first floor. The Eau Claire building is completely empty, and has been since it was acquired. The Green Bay, Madison and Racine “innovation centers” are occupied only by the businesses that were leasing space in them before Foxconn bought them. No renovations, no remodeling, nothing. No signs of Foxconn doing anything, not even any sign of actual Foxconn employees anywhere at any of the sites.
So what the heck is Foxconn actually doing? What will it be doing in the future? No one knows. Not even Foxconn.
There has been bad news all over the dairy industry in the past year, it seems. First Dean Foods declared bankruptcy, then just a few weeks later Borden, and now this – In 2019 Wisconsin lost 818 dairy farms, the most ever in a single year. Over the last ten years we’ve lost 44% of our dairy farms, more than 5,600.
When I was a kid, there were ten or eleven small family dairy farms on the road we lived on. Today there are only two remaining. Our place, with 140 acres and milking about 40 cows, was actually the biggest farm on the road at the time. Today that size seems almost ridiculously tiny. The average dairy farm today milks 170 cows, but even that is misleading because most of those cows are now on farms where they’re milking 500 to several thousand cows. They still call them “family farms”, and I suppose technically that’s true because a single family is the majority owner of the corporation the farm operates under. But in reality those “family farms” are no more family farms than Walmart is a family company because Sam Walton’s descendents still own stock in the company.