The International Monetary Fund just dropped a bombshell, and nobody noticed. For the first time, the organization predicted when the U.S. economy will be overtaken by China, and the “Age of America” will come to an end. And it’s a lot closer than you may think — 2016!
One way to profit from that prediction is to follow the cash flowing into global agriculture to support Asian demand, especially for soybeans.
The demand is so great that China is willing to put serious money into assuring a consistent long-term supply. Last month, the country announced a $10 billion outlay to Brazil for production, storage and transportation of soybeans.
Several factors are contributing to this trend. For one, the global population is exploding by 75 million a year, according to the United Nations. That increase is cutting into the amount of arable land in the world.
In addition, demand from developing countries is surging due to rising standards of living. As the wealth of the population increases, so does its consumption of meat and other foods, and its need for fertilizers.
Finally, there’s still lots of land that’s yet to be exploited. Planted areas throughout the world are expected to continue to expand rapidly, especially in Brazil, one of the largest producers of grains, sugarcane, meat, coffee and low-cost forest products.
Latin Americans are preparing for the new world order with intra-regional free-trade agreements aimed at boosting their competitiveness as suppliers to China. In addition, adding Asian-bound exports of meat, soybeans and other agricultural products to existing shipments of metals and other natural resources adds wealth and stability to the overall economies in the region.
The good news is that these developments will “lift all boats,” so I’m looking forward to more profit-making opportunities in emerging market growth stocks across multiple sectors.
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The growth China has had in the recent years is too uneven. They are experiencing similiar conditions that Japan did in 1990. The demographics of the two nations are very much alike. They usually result in too much investor money and too little consumer money. It’s the recipe for a disaster that will probably last decades.
Since our government has determined the U.S. is to become a “service”oriented economy by encouraging overseas investments, overtaxing producers and consumers here, making U.S. products uncompetitive, why don’t we all go for the bucks to be made selling our nation into the one world economy.