Food vs Gas (+Chickens)

Prices are going up.

Supply chain is still totally wrecked.
Federal Reserve is wrongfully increasing interest rates.
The chickens are coming home to roost.
Don't shit where you eat.

There's a lot to be said for everything going on in the world today, but I think it should be obvious by now that the silly "V-shaped recovery" we got in 2020 was simply delaying the inevitable. The world economy will go into recession sooner or later just like it did in 2008, and most people are going to get wrecked because most people have zero savings and a negative net worth.

Price of gas

The price of gas has almost nothing to do with Federal Reserve policy and everything to do with supply and demand and the overall health of the economy. America, being a beacon for the war machine, the Petrodollar, and the world reserve currency, has always enjoyed dirt cheap gas prices while other countries pay up to twice as much for petrol.

$7 a gallon is not a lot, yet everything is relative and people who are used to paying $3.5 will complain that this is a cost of doubled even though citizens in Europe have been paying that price for over a decade. Ironic how liberals are willing to pay more for gas to engage in economic warfare when ten years ago they wanted to pay more for gas to avoid the whole blood for oil scenario. I guess there's a big difference between the Russian boogieman getting amplified by the propaganda machine than middle-eastern countries that most wouldn't even be able to locate on a world map without labels.

It's interesting how people forget to question the legitimacy of a particular government when they come under attack by an enemy. It's not like the Ukrainian government is any good. Like the vast majority of governments (if not all) it does not serve the people that it lords over, and instead opts to play the game of intrigue and power. There are very good reasons why everything has gone down the way it has, and dumbing it down to "Russia bad!" is super toolish. The propaganda machine does not want informed citizens; that is a fact.

Also I've been saying that Biden couldn't win reelection before all this crazy shit went down. These sanctions against Russia really seal the deal. People only voted for Biden because they wanted to get Trump out of there (and even then you must ignore all the allegations of cheating). By the time reelection rolls around there's no way his approval ratings are going to be anywhere near what they'd need to be to win a second term. The volatility will continue on in all aspects.

The stacking sunburn.

The economy keeps getting scorched, and a negative feedback loop is feeding into itself. It's really only a matter of time before it all crashes into the mountain. Obviously I'm betting on crypto having a nice bull run in 3 months, so it would be nice if we put this off until the end of the year so that I would personally have time to turn properly bearish on the market. Considering we've been riding on this slow motion train-wreck for over two years and it still hasn't derailed yet, I'd say there's a good chance more and more delays creep in there. Soon™

Preparing for an actual bear market

There hasn't been a bear market since 2008, and before that 2000. We have yet to see how Bitcoin operates in a bear market, so this is actually an exciting thing to look forward to. My expectation is that Bitcoin will crash to the doubling curve and grind there during accumulation just like it always does. If stocks are bleeding while Bitcoin is grinding forward, that's a huge win for Bitcoin and crypto in general. That will get the attention of everyone, and the store-of-value proposition will come back in full force.

When I look at my expenses I can see that I have pretty much nothing to worry about. The price of all supply-shock products could triple and I'd still be totally fine. Such privilege. I don't have kids, and even if I lost all my crypto in a boating accident my girlfriend has a high-paying job in a construction manufacturing plant that actually gets more business during recessions than not (as clients come to this particular company looking to cut costs).

Oh yeah and funny story:

I was telling my girlfriend to buy Bitcoin constantly in 2018 and 2019 but it was too risky for her, but one day her financial advisor calls her up and says, "Yeah I really want to diversify 1% of your portfolio into crypto." Only because she was getting it from both sides did she finally agree to the 1%. Then later I come to find that the 1% got increased to 3%, and the 3% then got increased to 5%.. lol

My girlfriend aggressively saves all her money. On paper it looks like she lives paycheck to paycheck, but that's because she's throwing like half of her money into these investments and retirement accounts because her dad is terrible with money and she's convinced she will be stuck with the bill when it comes to his retirement.

And all of this happened before November 2020 when Bitcoin spiked x4 to $40k... Basically all this money she'd been saving for over a decade... 5% of it got put into crypto at $10k BTC or below... which is obviously insane. She could have more crypto than I do and neither of us would know. She hasn't looked at that account for years because it's "too stressful" and "that's what I pay my financial advisor for" yada yada yada. I expect when she does, that 5% she put into crypto will have ballooned to 25%-50% of her entire portfolio. It's gonna be weird if she has more crypto than me. Facts.

So obviously I personally have nothing to worry about.

I spend $800 a month. If that needed to double to $1600 this would only be an annoyance, not the devastating crippling blow to others who have literally zero buffer or emergency money. Those who lose their jobs are going to be destitute. Still, I haven't even come close to getting to the actual point that this post was supposed to be about.

Right... Food vs Gas

What I actually wanted to talk about are the stark differences between certain assets going up in price when compared to others. The price of food going up has a much different outcome than pretty much every other asset, because food is the one thing that people can actually create.

When gas goes up, we have two options: use less gas or eat the cost. Most have to eat the cost because tons of driving is simply commuter traffic. No one can make their own gasoline no matter how high the price spikes. Food is a different story.

Cost of chickens

This is something I actually have personal experience with.

My ex and I ended up taking five chickens from a friend who could no longer take care of them (moving to a new place). I probably overfed them a bit because we treated them more like pets than products, and the feed was a bit more expensive and higher quality than normal. I did the math and after dividing the cost of feed by the number of eggs per month it ended up around 50 cents per egg.

Now obviously 50 cents per egg is like... a lot. Anyone can easily go to the store and pay 25 cents per egg from a factory farm. Not only could you pay half as much but also you don't have to take care of chickens, which isn't a ton or work but it's definitely not nothing.

And then there is something to be said of the quality. Obviously the eggs I was harvesting in my own backyard were way higher quality than one from a factory farm, and you could tell just by looking at them. "Organic" egg is organic. The chickens I raised had a better life than 99.99% of all other chickens on the planet. That is a fact, and I wasn't even trying very hard.

Two more things

Chicken shit does not have a value of zero. I would buy these bails of hay/straw and use them as bedding to make their waste much easier to clean up (and just all around cleaner habitat in general). Every day I'd throw down a layer to keep everything dry and clean. When the stack got too high I'd shovel it out of there and throw it into the compost bin.

What I didn't realize is that chickens naturally create a ton of compost. And it's not like regular compost that you'd buy at the store. It's like super compost that's 10 times better than stuff you can buy at the store. I did a little science experiment to compare the two, and plants that I grew with my own compost grew three times bigger and faster than the stuff I bought from the store. Pretty crazy honestly.

And chickens themselves are always scratching and pecking the ground looking for bugs and things to eat, so they basically turn over and mix up compost for you. In fact whenever I'd turn the pile over myself with a pitchfork they beeline run over to it to make sure they got all the bugs that were hiding at the bottom. Such weird dumb hilarious farm animals, chickens. I mean also you can obviously eat them as well but I'm not about to butcher animals on my makeshift farm. No thanks.

And secondly

If I had more land (or if I had been willing to let them rampage the entire backyard instead of just the gated area) the cost of food for them would have been greatly reduced. Hell, I probably could have been feeding them half as much anyway. They were huge and always made a lot of noise when they were begging and I fed them because you're supposed to have a city permit if you have more than 3. With enough land a farm can host a small number chickens at zero cost.

Getting to the point

The point here is that food doubling or tripling in price is actually a good thing. If the price of eggs spikes to $7 a dozen, all of a sudden it becomes profitable for everyone to own chickens if they can accommodate them. We are approaching an era where centralization and efficiency have reached maximum diminishing returns. The transition to decentralization and quality products is going to be a painful one, but suffering is often necessary for evolution to occur. The environment is changing, and we must change with it and become sustainable, or continue trusting centralized sources to our own detriment.

This clearly applies to many other things as well like greenhouses, sustainable energy production, decentralized mesh networked internet, and obviously money itself in the form of cryptocurrency. Crypto has already proven it's value even though it's a highly efficient and largely ridiculous system. That just goes to show us how bad our trust issues with authority have gotten. Soon it will be worth it to make our own products rather than assuming a centralized supply line will remain intact. All we need to do is keep building out the infrastructure and these things will become much more apparent as time goes on.

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