Did you know that the price of corn has risen 142 percent in the last 12 months?  Of course corn is used in hundreds of different products we buy at the grocery store, and so everyone is going to feel the pain of this price increase.  But it isn’t just the price of corn that is going crazy.  We are seeing food prices shoot up dramatically all across the industry, and experts are warning that this is just the very beginning.  So if you think that food prices are bad now, just wait, because they are going to get a whole lot worse.

Typically, Americans spend approximately 10 percent of their disposable personal incomes on food.  The following comes directly from the USDA website…

In 2019, Americans spent an average of 9.5 percent of their disposable personal incomes on food—divided between food at home (4.9 percent) and food away from home (4.6 percent). Between 1960 and 1998, the average share of disposable personal income spent on total food by Americans, on average, fell from 17.0 to 10.1 percent, driven by a declining share of income spent on food at home.

Needless to say, the poorest Americans spend more of their incomes on food than the richest Americans.

According to the USDA, the poorest households spent an average of 36 percent of their disposable personal incomes on food in 2019…

As their incomes rise, households spend more money on food, but it represents a smaller overall budget share. In 2019, households in the lowest income quintile spent an average of $4,400 on food (representing 36.0 percent of income), while households in the highest income quintile spent an average of $13,987 on food (representing 8.0 percent of income).

Needless to say, the final numbers for 2020 will be quite a bit higher, and many

believe that eventually the percentage of disposable personal income that the average U.S. household spends on food will reach 40 percent.

That would mean that many poor households would end up spending well over 50 percent of their personal disposable incomes just on food.

At one time that would have been unimaginable, but now everything is changing.  As I noted above, the price of corn his increased 142 percent since this time last year…

Corn prices have jumped roughly 142% over the past year to $7.56 per bushel, the highest price seen in eight years for the crop.

A drought in Brazil and increased demand in China have put pressure on global suppliers.

In other areas we are seeing more moderate inflation, but overall we just witnessed the largest increase in food inflation “in almost nine years”…

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Over the years I have published numerous articles with “investing laws” from some of the great investors in history. These laws, or rules, are born of experience, tested by markets, and survived time.

Here are some of our previous posts:

• Bob Farrell’s 10-Rules
• Desktop Trading Guide- Part I
• Desktop Trading Guide – Part II

Throughout history, individuals have been drawn into the more speculative stages of the financial market under the assumption that “this time is different.” Of course, as we now know with the benefit of hindsight, 1929, 1972, 1999, and 2007 were not different. They were just the peak of speculative investing frenzies.

Most importantly, what separates these individuals from all others was their ability to learn from those mistakes, adapt, and capitalize on that knowledge in the future.

Experience is an expensive commodity to acquire, which is why it is always cheaper to learn from the mistakes of others.

Importantly, you will notice that many of the same lessons are not new. This is because there are only a few basic “truths” of investing that all of the great investors have learned over time.

The next major down market cycle is coming, it is just a question of when? These rules can help you navigate those waters more safely, because “you’re different this time.”

Doug Kass’ 50-Laws Of Investing

Consider it like Shark Tank on your phone: Every week on Angelhouse, founders make a pitch to a panel of investors as hundreds of people listen in.

STARTUP FUNDRAISING CAN be bloodsport, which also makes it great entertainment. Shark Tank first brought pitch decks to prime time in 2009, spawning an entire genre of investment-as-reality-TV. To name just a few: Meet the Drapers (hosted by venture capitalist Tim Draper), Cleveland Hustles (hosted by basketball legend LeBron James), Entrepreneur Elevator Pitch (exactly what it sounds like), The Profit (weirdly, for investing in failing businesses), Dragon’s Den (like Shark Tank, but British), and Tigers of Money (like Shark Tank, but Japanese).

The latest entree on this theme is not on television but on Clubhouse. Every Wednesday at 3 pm Pacific time, a new handful of founders duke it out before a panel of angel investors in a weekly show called Angelhouse. Hundreds more people listen in. The conversations between founders and investors can be educational, but “the purpose of hearing pitches is not to give advice,” says Geoff Cook, one of the angels. “It’s to decide: Do you want to invest or not?”

From the start, Clubhouse has had a vibrant startup scene, and many of the app’s top users are venture capitalists. It’s not uncommon to stumble into a room full of entrepreneurs practicing their pitches, or investors discussing the latest startup trends. Cook, who founded his first startup as a freshman at Harvard in 1997, has sold several companies and now dabbles in angel investing. After spending some time on Clubhouse earlier this year, he realized it might be a good place to find some new deal flow. He asked a few other angels he knew if they wanted in, and in January, Angelhouse began.

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