Farmer Diaries

After spending five days in the US, we flew to Calgary to see friends of ours. The province of Alberta is in the middle of an independence debate that is going badly, especially when the leader of the independence movement has just been served with a $100 million lawsuit by a US hedge fund that was backing his independence movement activities. It seems that the hedge fund was sold something that could not be delivered. Our stay in Canada was limited, but one thing we found amazing was the new Canadian identity that has been created since Donald Trump, the American president, began his trade war with the country.  Canada, like Germany at the beginning of the war in Ukraine, know that a trade war with America will be costly. Aside from a few crazy separatists, the vast majority of Canadians, even in Calgary had the same view, as they say "elbows up". Somehow that refers to ice hockey. In our two days stay in Canada, it was apparent that there was a strong anti-American sentimen...

I must be a glutton for punishment but my wife and I are just back from a trip to America.  Again the wedding of the daughter of a friend of my wife, and so we went to Georgia for five days.  We landed in Atlanta, and the whole process was as unpleasant as it had been in the past.  Many questions about why we were in the US, and that I appear to go to the US very often.  They did not like our home address, somehow they still have issues with addresses in the UK.  Still after an hour, we made it into the country. Weddings are weddings, they change and they look different. Some of it is cringing, but there’s a rhythm to the things and usually by 1 AM you’re done.  We underestimated the welcome we received in Georgia.  To be perfectly honest, the entire weekend was lovely. Both my wife and I stayed away from any political conversation. Nevertheless, we were both surprised by the ignorance of the people of the party, in particular the young ones. I have no...

Trump's desire to reduce the price of beef is a last minute reflex, that is understandable considering how much the American population doesn't want to understand what is happening.   The fundamental problem is that beef production is the lowest it has been for nearly 70 years, and the reason is drought.   31 US states are operating in a severe drought environment, and a cow will consume at least 15 gallons of water per day.  No water, no cattle.   It was evident months ago that there was a fundamental problem in the United States when large slaughter houses started shutting down.  At first the reason was that most operated with illegal labor and that ICE was active.  However, the compliant slaughterhouses did not have a good 2025 year anyway. The problem was massive herd culling.  How do I know? I am a farmer, and these things are discussed.   So Donald Trump wants to import the equivalent of 1.2 million head of cattle for ham...

Forty trillion dollars is a lot of money! Even on planet earth its a lot of money.  The problem is that America is not the only one borrowing, moreover, more than three trillion dollars worth of maturing bonds have to be refinanced.  That's a lot of money. The other factor that is important to understand is that America is not the only one borrowing, but it is the only one that is trying to kill its trade deficit.  What American policy makers fail to understand is that a trade deficit is basically a situation where you get stuff and you give sellers little pieces of paper that they keep in safes.   About 40% of all new treasury bonds are purchased by foreign holders.   The two largest holders are the Japanese government and the Chinese government.   The latter is reducing its holding quickly because it needs liquidity.  The reality of China that most don't seem to understand is that it is quickly aging and about 25% of its economy is dis...

An often asked question is, could the US dollar's hegemony be at an end?  Could another method of exchange be used, and could commodities be priced in things other than dollars?  The short answer is YES, the long answer is IT COULD take a long while. The problem is that the dollarisation of the planet for trading has been in place for nearly five decades.   The convergence of very specific factors (a) the American economy eclipsed the rest of the world in the 1950 and 1960s (gold was still an important benchmark then).   (b) A large percentage of trade was directed to the United States, and (c) many currencies were not freely exchangeable or very liquid.   The only real debt markets were the UK (the old standard of exchange) and the United States.  In short it became "convenient" to price things in US dollars. The first American President to weaponise the US dollar was Bush after the World Trade Center attack.  People forget that once th...

OK first,  I have no skin in the game, but what is remarkable is that I had completely understated the amount invested in the AI sector.   To give you a sense of how large the investment in the sector is, the Bank of England in a recent study indicated that for AI investment to meet the current stated rate of return, the entire sector would need to generate nearly $2.5 trillion in revenues per annum.  To give you a sense of perspective, it's equal to 140% of the total revenues from the global tech sector.  BTW, that's a lot of money! Today, right now, (and from the same study) corporate executives use AI for about 100 minutes per week, they pay small amounts and have generally indicated that they have not seen any real value to the product.  Still they pay the minimum (a few hundred dollars a year).  The second group are small businesses that have been able to scale up their operation using AI instead of human staff.  Again, not nothing, but not a...

There were two American icebreakers, the Polar Star and the Healey.   The first one has been in drydock for over three years, but the work has now stopped, it has now been determined that the 50 year old hull is simply not up to the challenge.   The Healey was supposed to be the answer, in 2024 it suffered from a massive fire, and limped back to port. In its recent sea trials it had a massive engine room fire. It is not clear at this stage if the vessel can be rehabilitated.  In short, the US navy needs new icebreakers. So far so simple, one tiny fly in the ointment, there are no US shipyards that are currently able to build a new military vessel (the shipyards that could, are booked until at least 2031).   The solution is to purchase new hulls from other nations.  The problem: the two shipyards that have the ability and capacity to build such vessels are in Canada and Finland.   Not exactly good friends right now.  The first is obv...

It has been evident that the era of scientific achievements has now passed, it has taken two Republican governments to seal the faith of science as a cornerstone of the American system. Don't believe me, look at who leads the nation today; lawyers and idiots – think Robert Kennedy or the recent candidate to the CDC – obvious examples of people who are driven by ego and "truthiness" rather than the cold reality of science.   The seven stages are: The Age of Pioneers: Small, energetic nations burst onto the world stage with high courage, dynamic leadership, and a strong sense of collective purpose. The Age of Conquests: Territorial and political expansion through military might, building upon the momentum of the pioneer phase. The Age of Commerce: Great enterprise and trade flourish, bringing massive influxes of wealth and transforming the nation into a global economic hub.The Age of Affluence: Wealth peaks and comfort becomes widespread; however, greed begins to replace ...

That's how much it costs now for a big mac, a french fry and a coke.   In 2019, the same meal would cost $7.50.  What happened? The reality of the fast food industry in America is fascinating, the country is awash with fast food restaurants and low value chains.  The reality of the game is two fold: first the corporations that run the fast food industry have run against a fundamental large number problem – there's simply no room for expansion.   The franchise that operates new restaurants cannot find "interesting opportunities" which translates into areas where there is a shortage of supply.  In order to keep their stock prices up they have resorted to increasing the price of ingredients that the franchises have to purchase (including services).   Over the past five years, despite virtually no additional outlets, and stagnant sales figures, companies such as McDonald have increased margins through higher prices, which translates into a 160% increase in the ...

First, its been obvious for weeks that the stories around the deterioration of the Washington Reflection Pond were completely made up but a morally bankrupt administration.  Now the head of the Justice Department and the head of the department of interior are fighting about who is more at fault, especially now that it has been proven that not only did the Park service testimony was that there was no evidence of willful destruction.  In addition, those who have been accused of damaging the reflection pool are now seeking legal redress – it's going to cost a few people some serious coin. Now the head of the department of health, an anti-vaxxer had a total meltdown on television over the weekend, where he accused the interviewer of not being a scientist…which is true, but he is not a scientist either.  The public health crisis, the complete stupidity of those being sent up to the Hill for confirmation.  The person that was nominated to head the CDC had never heard or rM...

I don't care about football.  However, I do know one thing. Inside the European football union (whatever they call themselves) they never agree to anything, ever.  When it was announced that FIFA was selling out to investors the rights to the world cup for $20 billion, the reaction was almost immediate.   55 members said that if there was a sale, they would not participate in any world cup event, ever!  It took the 55 members exactly one hour over a Zoom call to agree to this. That dog don't hunt – as my American friends would say

In my opinion, the biggest change to the world over the next five years will be the application of AI to government services.  Let's be honest here, Governments provide services, much of which are pushing bits of paper from  A to B.   A lot of the "work" is a reflection of a world before computers.   If an accountant, trader, banker and a lawyer can be replaced by AI then civil servants should be the first to go.    From my experience (and it has been limited) the vast majority of civil servants are there to collect and collate information, and disseminate the results of new rules and laws as drafted by politicians and senior civil servants. In a nut shell, probably in excess of 40% of current civil servants could be replaced by AI.   Now, the tricky part, as the US government has recently discovered, is who are the essential bits and who are the redundant bits.  Part of the problem is identifying the right one, and again this is wh...

It has been the most successful investor strategy over the past 30 years, but like everything it must come to an end.  For 30 years, hedge funds, private equity funds and other investors have been borrowing in Yen and investing all over the world.   The truth was that for the past 30 years the zero interest rates and the slowly depreciating Yen allowed the financial community to borrow massively (aka leverage) and generate higher returns.    How does this work?  Well you borrow $1 million in the tokyo market, effectively you borrowed Yen 100 million at a rate of exchange of 105 to the US dollar.  The interest rate on this loan is 1.3%.  That's the start, the risk is that the Yen rises, that's it.  You take that money and invest it at 4% (buying US treasury 10 year bonds for example), and you take the yield and declare it as your profit.   Now let's say that you do this for $100 million, and that you used $2 million of your own capit...

The new American CPI numbers came out yesterday and the news is excellent, inflation is down 0.5% which no one expected!    That's the good news, now the not so good news.   Oil prices are stripped from that dataset, its normal, fuel prices distort the "economic indicator".  However, the CPI figures have to be taken with a grain of salt (always mister negative – as the title indicates).  The 2020 pandemic led to massive consumer price increases.  What no one noticed is that since then prices have not fallen back, as a stupid example. In 2019, a brick of espresso coffee was £2.35.  Last week the same brick of espresso coffee was £6.75. Same brand, same size – almost three times as expensive.   Now, the point is as follows, and it's important, Americans have for years replaced revenues to meet their expenses with savings and debt.   This is not a secret to anyone in the world.   Americans have more debt today and less s...

Space X:  I don't know if collapse is the right word, but the shares are currently trading at $123.00 down from a peak of $201 and an issue price of $165.   The problem with SpaceX is that it generated no profits, in addition, the company has aggressively moved into the world of AI, which has little to do with its space venture. In fact, the free cash of the company appears to be destined to that endeavor rather than rocketry. Truth Social: In another note, I made the comment that Truth Social Media had increased the value of its intangible assets by nearly $1.1 billion (up from $25 million).   Apparently, there is an explanation, it's the brand. You see, Truth social is so valuable (despite generating no profits and declining revenues) that the company management (with the agreement of the auditors) has assessed that the company has an additional intangible value of $1.075 billion.  I'm just not interested enough to get to the bottom of all this.  Bo...

Nobody should be surprised by Europe's recent weapons' procurement announcements.  On one side, the word is out that Europe is looking, and has a verbal agreement with Donald Trump to manufacture Patriot missile systems under license.   However, Europe is also looking at short range missiles out of Ukraine.  Guess which system will be running first; sorry no contest, it will be the Ukrainian system, first its short range, (less than 1,000 NM) which matches the European theater of war (aka Russia), second, a deal with Trump is never real even when it is signed, looked at all the agreements he signed over the past two years, few lasted more than 90 days before Trump changed his mind.    The truth is that the Patriot deal is probably vaporware, and will never be implemented, but it gives Trump the oxygen he seeks with his base, which is the only thing that matters to him.  He can say that the Europeans are "begging" for US missile systems.  He probab...

Mitch McConnell is an American politician who faces some health challenges.  Apparently, his office released a photo of the man, with his wife, holding a newspaper…the amazing thing is that the article that is clear to read is from an article written in 2023.   Nearly three years ago. Now, it is understood that politicians are liars, it is the nature of the beast, you cannot govern if you let the electorate decide what the issues of the day are, because the electorate is fickle.  Take Brexit being an issue in the UK press in 2026.  It's a non issue, there is no possibility of Britain returning to the fold.  There is more hope for Canada to become a member of the EU, after all it has a border with Denmark… The sad truth is that after the death of Lindsay Graham the GOP's power structure is in trouble.  The funny bit is that the state of South Carolina has a very clear and clean process to replace the man.  It will be interesting if Trump and his ga...

The truth of the matter is that a deeply integrated economy to the United States is walking away.   First it is important to understand that about half of Canada's exports to the US are natural resources.  Some are mighty critical; oil, gas, electricity, timber and other minerals including Potash, where Canada sells about 90% of all potash used in the United States.   Tourism is another $40 billion.    Now, vehicles and parts are about $40 billion.  It is largely understood that the US's intention is to retrieve these operations from Canada. On the other side of the equation, what Canada imports from the US is foodstuff, vehicles and finished goods (do you know that there are other countries that sell finished goods).  The issue that the Canadian Prime minister raised is that he wants to diversify away from the United States its exports, imports will take care of themselves.   As an aside the Canadian Federal government has given gr...

There have been a number of reports that state that either the country is better off or worse off.  Right now in 2026 it is clearly worse off.   It stands alone with no allies, the dream of the Brexiters was that Britain would stand on its own two feet, and become a middle power courted by Europe and by the United States, plus they could get rid of all these pesky foreigners (which they never met…) The truth is complex, right now Britain is worse no doubt about it.  The economy is slowing faster than Europe and there is no lifeline from the Americans.  However, this is not a game of football, there is no end in sight to the process.  Europe has some massive challenges, already Italy, and Portugal are seeing the ravages of a falling population.  Germany has been better at hiding the impact, but they too face massive problems.  The truth of Europe is that it is highly dependent on the credit of Germany…there are implications going forward.  Ger...

When chocolate bars are no longer made with chocolate.  About a decade ago, I discovered that pringles chips had no potato in its ingredient list.   Yeah, I know considering what the packaging seems to imply.  However, American chocolate manufacturers have begun replacing cocoa and its derivatives with chemicals that are cheaper, they apparently also changed the composition of the "chocolate bar"  it no longer melts… Now, I have long discussed our business model, we focus on the higher end, "organically" grown crops and sell mostly to high end buyers and our own transformation businesses (aka our meat pie business as an example).    Last week an expose was made of the McDonald hamburger that was now mostly if not entirely made out of corn and its byproducts.  Now, I have no idea if McDonalds in the UK does this too, last time I had a big Mac was in the 1990s.   It seems that the American food industry has decided to double down on ingred...

The shares of Truth Social were listed in 2024 and the price quickly rose from the $17 dollar issue price to about $50.  The share price was range bound for nearly a year, when it eventually faced reality and started to fall, as all the vaunted management promises came to nothing.  The truth is that quarterly earnings while not in freefall,  are only above $800k, the management costs do not justify the share performance, which has been consistently negative since it was listed two years ago.    As of June 30th the share price stands just below $7.50 a share, market cap has collapsed to around $2 billion (still a lot if you consider that the operating cash flow is negative).  My guess is that over the next year the price will continue to fall, until it is below $1.00 and joins the pink sheet. Another company did something similar more than a decade ago, it was called the Grill Cheese Truck Company, which at one point had a market value in excess of $100 mill...

A week like this makes you a believer that global warming is an existential threat. Thank God we are not in London, still it's very warm and very uncomfortable for our cattle, especially for our dairy herd.  During the summer they are outside, but now they remain inside the barn away from the sun.   The ventilation systems helps, but still not a very pleasant time for our herd.   The ones that are doing the best are the pigs in the forest.  Chickens not so much, we have tried to place the meat chicken enclosure near the tree lines away from the sun, but we may have to butcher them early, they may die from heat strokes. One unexpected outcome is the increased efficiency of our biodigestors, thank god because our greenhouse fans are operating 24/7 to keep the temperature down in the greenhouses.  One good thing about the early June weather is that the water table is high.  In fact, the sudden heat has been helpful in drying out our fields that saw m...

A few days ago the Space X IPO happened, and two things are remarkable.  One expected, the share price of Space X fell a bit, its down from it $218 peak (issued at $200) down to $156 at closing on the 23rd of June.  The second is that Space X just borrowed a lot of money (actually drew down facilities it already at hand).  The second could (maybe) be caused by the first, it takes a few days for the 75 billion Space X raised to make its way from the various brokers to Space X coffers, so the drawdown could be related to that.  HOWEVER, it seems that SpaceX little mentioned AI foray cash consumption is even higher than anticipated. For Space X the real savior is the inclusion in the NASDAQ index, in particular the QQQ, it got a special one of exception of the two rules for inclusion (be listed for at least six months and profitable).  Space X has been listed for 10 days and is not profitable, nor is there a clear path to profits – the forward looking statements st...

The past four years have shown that the old adage that force projection was everything has been turned on its head.   The early destruction of Russia's tank offensive by Ukrainian drones (and the Russian's own stupidity), had fundamentally changed the power structure.   Until six months ago, the general perception was that the might of the US and of Israel in the Middle East was unchallegable.   Iran, Ukraine and drones proved otherwise. In the middle east Iran has been largely unchallenged in its ability to strike US bases in Kuwait (ok that's next door), Qatar Saudi Arabia and Dubai (a bit further).  Iran has shown a deep bench in terms of drones and its willingness to use them effectively.  It's unclear how much remains in the US munition depots, but it is serious enough that the American government which had sold systems to the Finn have told them not to expect any systems this year or next (and the US has been out of Ukraine for nearly two ye...

Was the departure of Prime Minister Starmer necessary?   In short, yes. He had two years as the leader of a new labour government with a crushing majority to take action.  He did absolutely nothing as if he was still a backbencher in the opposition.  He also made a massive error in inviting Peter Mendelsohn into his government when it was already well known that he had ties with Epstein.  This showed a massive lack of judgment on his part (and he only had himself to blame for that one). Will the new guy do any better, Andy Burnham has been a parliamentarian his entire adult life, from 2008 until 2016, when he became the mayor of Manchester.  Will he be an effective Prime Minister, who knows, the truth is that Starmer has largely been an empty shirt for the entirety of his mandate, he has managed to make the far right look good.   The same way Trump has made Iran's leadership sound reasonable (they are not – actually homicidal maniacs), and China a...

 Out of kindness of my own heart, I never mention the names of the billionaires that have bought property in Argentina. Several months ago, I mentioned that massive farms had exchange hands for millions and millions, and that these were self-sufficient mega mansions owned by some of the richest people in the United States. Well, this week, Peter Thiel indicated that he was moving to Argentina. It’s unclear this stage if this is a full-time thing or if it’s temporary one. Doesn’t really matter, Mr. Thiel has always been known as a right winger, at the very right of Genghis Khan.. I never spent a great deal of time in Argentina. South America is too complicated and too far away for London base businesses. In addition, most of South America has a love affair with the United States. I’ve only been to Buenos Aires three times in my life, twice for work and once for our holiday, a 25 year marriage anniversary gift to my wife and I. In fact, it has been more than a decade since I set foot...

 I am no fan of football. Couldn’t care less about the FA cup for that matter of the game in general. The summer, the Americans are going to host the World Cup. The funny bit of course is that this was all they doing of the President of FIFA and Donald Trump during his first administration. It appears, that FIFA has taken a very Mercantile outlook on this year‘s contest. Ticket price are 3 to 6 times higher than they were in the last World Cup. Granted, it makes sense for them to try to grab any available dollar. What has been even more impressive, is America’s dual message. On the one hand, hotel prices have increased 5 to 6 fold for the month long. Contest. And all the other hand, the Department of Homeland Security, ice, and many other security agencies have made the life of potential participants difficult. For many countries, visitors to America will need to post large bonds, a $15,000 per person. obviously, potential visitors are taking the view that this is looking like a ex...

Président Xi has a measure of Donald Trump. Pump and circumstance that’s all he cares about. So far the American president state visit to China has generated nothing burger. it’s not at all surprising, at the end of the day, Donald Trump wants one thing increase exports of US made goods, of any kind, to China. China, wants one thing, the ability to manage its regional affairs; in plain English take over Taiwan. It’s more than likely that both men will leave disappointed. The fact that Donald Trump talked about a board of trade between the two country, to manage investments and trade, tells you everything you need to know. Create a real or fake organization or Donald Trump can say he has nothing to do with it and ignore the problem, and yet bitch, if the Chinese don’t buy American goods. The roadmap to Donald Trump has now well established. Ignore him, provide good entertainment and reasonable food, smile a lot, and make sure that him and his buddies get back on the plane.

  The Energy crisis The effect of the war in the Persian goes gulf are about to generate critical shortages in our economy. The reality of the United Kingdom, is that our primary energy imports are from the United States, Norway, and North Africa. That means, that none of our energy is sourced from the Middle East. So for the United Kingdom, the problem will not be supply. It will be price.  In its war with Iran, Donald Trump has decided to blockade the straight of Hormuz in order to deny income to the Iranians. In this fight, America is largely energy independent. It produces and exports more than it imports. It’s a net balance, as opposed to true energy independence, that most of the light and sweet crude produced in the United states has to go elsewhere to be processed. America’s refineries were built for heavy sour crude. This shift by America from being the policeman of the seas to Mercantile protector of the interest of North America is a long expected shift, excep...

The stage is set, the American President is about to commit war crimes by bombing civilian infrastructure.  It is amazing that Donald Trump has managed to make the repulsive Iranian regime into anti-heroes.  Pol Pot, Hitler, Stalin and now Trump…   Considering that Trump has fired a dozen generals, and is probably going to fire a bunch more, who probably refused his illegal orders, the stage is set for a pain over the next five years.  Rumors are that Iran has already bombed Saudi Arabian production and transport facilities, that were previously protected by Qatar and Kuwait, the situation could not be more dire. The impact on the global economy and on people's lives cannot be understated.  Poverty, famine and pestilence will be the result of the actions of this madman.  What is truly unbelievable is that there is no one stopping this madman, this is clearly a case of calling for the 25 amendment, but his replacement is as mad, and a religious nut too....

It has been years now, but Americans are crazy, there's no doubt about it.   It is evident that their electoral system is broken (we're not doing that great either) special interests run the place, and if you think otherwise you are lying to yourself.  It is more than likely that the 2026 mid term election will be the most honest in decades, because of the disgust of the population.  I want to be clear the wantonness of the republican party is matched by the wokeness of the Democrats.   The current occupant of the White House is an old kleptocrat, that was elected by an electorate that was so disgusted with the old bunch that they decided to punt for "that guy"  who proved over and over to be not only a bully but an idiot. Things are serious now, the situation has become dire.  Let's be clear, Trump has invaded Venezuela, threatened the same for Canada, Greenland and Cuba.   In addition he has started a war with Iran, that is going so ba...

I have not posted in more than six weeks, mainly because I have no insights to add.  Things in the UK are deteriorating rather quickly, and I am finally impressed with our Prime Minister who seems to have finally found parts of his backbone…  Things on the farm are unchanged, as I said a number of times we are largely unaffected by the moods and changes of the nation, the reality of our business model.   In terms of timing, 2025 we decided with our investment partners to restrict capital expenses on our various businesses, first because the new injections were massive, several of our businesses, if they were to grow further, had to undertake substantial investments, we were by some coincidence at a inflection point for several businesses.   Neither us or our partners were keen on moving ahead, especially with the political and economic challenges.   Boy are we glad to decide to pause our investments now. It would be a huge lie to say that we "knew...