Canadian Wheat Board Collapse, submitted by Richard Smiley

Legislation will be introduced by the Conservative government to abolish one desk selling of wheat and barley by the Canadian Wheat Board.

Every time CBC radio covers the ongoing saga of the Wheat Board, and its overwhelming support by growers, it always manages to give equal time to the "other side": solitary large farmers who "know" that they will be able to cherry pick the market, timing their buying and selling to achieve the best price for themselves, who cannot wait until the board's monopoly on sales will end.

The Conservatives, of course, are in favour of "free markets",  which generally means that the large traders are "free" to make as much profit as possible at the expense of the public.  They have in all likelihood received large campaign contributions from such as the commodity traders who stand to benefit from a new influx of chum into the shark pool.  This is not to say that no small trader ever makes a profit, but to acknowledge that while they may on occasion luck out or very rarely become professional traders, most of them end up leaving with rather less wealth that they had when they started.

Pride goeth before destruction, and a haughty spirit before a fall.  Proverbs, XVI, 18

Whatever the case, there seems to be a singular inability to ask the tough questions of these individuals. 

Such as "How much have you made in the last twelve years in the stock market?"

Or: "Have you successfully traded commodities, and if so, how much profit did you declare on your income tax in the last year, the last five years, and the last ten years?" 

Or even: "If you are so good trading, why don't you just hedge your production with a private commodities account and let the rest of the farmers have their Wheat Board?"

Let alone: "If you are so so good at trading, why are you wasting your time farming?"

Or, Heaven forfend: "Why are you farming at all?"

There are three sure ways to lose money: Gambling, Women, and farming.  Of these, Gambling is the quickest, Women the most interesting, and farming the most certain".  - Moshe Dayan

How do you make a small fortune at farming/ a vineyard/ cattle/ fill in the blank?  Start with a large fortune!  - an anonymous farmer

I raise these matters because as an agronomist with practical and well as academic credentials who is waiting for the property market to crash so that he can (blush) ... buy a farm... and no small past in commodities markets, I see no evidence that any of these interviewees have done anything except farm.  

Note: (I started out wildly lucky, and when I got out, my winnings had all bled back into the market - and we are talking about perhaps one of the greatest bull markets the world has ever seen: that of gold and silver over the last eleven years. Still, it was an education.  I was subsequently able to see the truth behind all manner of scams and businesses that tried to sign me up for research or services or margin accounts so that I could successfully trade whatever.  Some people never learn - not even from their own experience.  By comparison, the stock market was like taking candy from a baby)

The only farmers I know of who make money are those who have quota; i.e they are able to market under the aegis of a government board which prevents free competition by anybody who, seeing his neighbour's prosperity, decides to get some of that for himself.  The Conservatives, as mentioned above, are hell bent on ending this - and not just with the wheat board.

I've met a lot of farmers who can't read, and a lot who can't write, but I never met a farmer who couldn't figure.  If there was money to be made in it, some farmer would already be doing it.

- John Kenneth Galbraith, economist.

I almost never go to rural garage and yard sales.  I find the absolute poverty of these my neighbours that I see there to be embarrassing at best, and a cause for anger at the very least, considering that the rest of humanity owes its very survival to six inches of topsoil and the tillers thereof.  During the depression, my grandfather, who homesteaded northwest of Edmonton, declared "rather than sell eggs to the store for five cents a dozen and see them resold for ten cents, I will feed them to the pigs."  And he did.  The pigs didn't complain.

Hubris (definition): exaggerated pride or self-confidence often resulting in divine retribution

So who are these individuals who know that they are certain to get the best results by selling the products of their fields to the US multinationals?  What odds would I give that they will succeed? 

Well, I'm not saying that I'm smarter than everyone else, but I'm certainly no stupider.  I'm convinced that had others spent the amount of time I did in the last fifteen years learning about the markets and investing full time, some would have done better, and some worse - after all, the markets are really just a crap shoot.  What I am saying is that it is a bit of a stretch to go from there to the oft held assumption by non-players that they can, between periods of the Stanley Cup playoffs, reach into their shorts and scratch up a paradigm that better explains how the markets function than what I have learned from often bitter experience.

Prognosis not good.

Richard Smiley, ripponfalls@yahoo.com