Bargain Barbecue

Pork prices are dropping due to record pork and poultry production this year, bringing backyard barbecues to the cheapest level of the summer.

While low prices are making it difficult for livestock producers to turn a profit, they are still benefitting from low corn prices, near $3.55 per bushel on Friday.

It appears that pork prices could keep falling. Hogs are already cheap at 80 cents per pound, but futures markets are priced under 60 cents by December, which means that Christmas roasts should be especially cheap again this year.

Interest Rates Dive Lower

Record low global interest rates fell further this week after Germany sold ten-year bonds at negative rates in another attempt to stimulate its economy.

As negative rates are becoming more common, investors are literally paying for the right to loan money to federal governments, such as Japan, Germany, Switzerland, and other governments in Northern Europe. As crazy as it sounds, borrowers in these nations will be paid to borrow money, and those who save will be "punished" by having to pay to deposit money at banks.

While tough on bankers and savers, politicians created these policies to push citizens to spend more and help stimulate their economies out of stagnation. So far, this experiment does not seem to be working.

The U.S. has near-zero interest rates, though some analysts expect our U.S. Federal Reserve Bank to raise the fed funds interest rate in December.

Cotton Rips Higher

Cotton has been on a tear, gaining nearly 10% during the last week alone.

Recent strong export demand, especially from China, helped U.S. farmers sell their crop and pushed prices to a two-year high over 75 cents per pound.

The United States is a major cotton grower, ranking third in the world for bales harvested. Unlike the top producers, India and China, who keep their cotton for domestic textile industries, over 70% of U.S. cotton is exported, making us especially dependent on foreign demand.

Longer term, some analysts expect that the rally could fizzle out as clothing manufacturers look to cheaper substitutes and growers increase production to capture higher prices.