Thursday, February 8, 2018

How Situations Across the Globe Can Affect YOU

For the most part, people keep their focus pretty close to home when it comes to day-to-day living.  If you live in Nevada and get your strawberries from California and California has a poor strawberry harvest, then it will impact your ability to buy strawberries.  There may be shortages, they may import more berries from Mexico, the price may be higher than usual, but one way or another you will probably be able to get strawberries somehow.

On the other hand, since we live in such a global economy, things that happen half a world away can have a direct--and more dire--impact on you.  In this example, due to global warming and a poor harvest in India, the chickpea crop (who knew they were a world leader in growing chickpeas?) didn't produce enough chickpeas and it is being felt around the world in England.  We experienced such a thing first hand around eight years ago when the price of corned beef (something the spouse favors and even used to send to family in the Philippines by the case years ago) went from about 75 cents a can to $4 a can.  There was an explanation here, but the price never did go back down.  And then there was the rice crisis which had us sending rice, of all things, to the Philippines.  Europe is running out of butter due to higher international demand, and far off conflicts often impact the everyday items you buy at the grocery store.

Aside from food and commodities, the Chinese real estate frenzy that has impacted several nations including the US, stems from many changes that occurred in the politics of China.  In other words, if you work your whole life in the US and save for a house, you could have easily been beat out of the purchase a house (or the price would have gone up out of your reach, due to competitive bidding by Chinese investors), simply due to changes in a country many thousands of miles away.

At this point in time I think we are way past protectionism (although Trump probably needs a crash course on such things), but there are ways to prepare for global commodity and other economic upheaval.  These include: stockpiling (within reason) the things you need, not buying at the top of the market (the chance of me getting into a bidding war with newly minted Chinese millionaires in the Bay Area is zero as I never buy at the top of the market of anything.  And now that the price of solar panels are increasing it will take a bit of time for market competition in the US to drop prices again; buying them now probably isn't a good idea), going without (decades ago on the farm when you had a lousy tomato harvest, you simply went without tomatoes for a while), and adapting to change (if I can't get chickpeas at a reasonable price and dearly want to make hummus, I might try using other beans to make hummus and see what happens).

As the Marines say, "improvise, adapt, and overcome" which should be everyone's mantra in this quickly changing world.

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