Road Warrior of Agriculture Update.
Our mission is to provide insight on challenges and issues impacting agriculture decision-makers. My goal is to provoke thought and provide tips that may influence your industry, business, family and personal lives.
These past few weeks I have been crisscrossing North America presenting seminars and involved in management discussion groups. Stops have included Spokane, Washington, Ottawa Canada, Sacramento, California, Freeport and Mendota, Illinois, and Lancaster, Pennsylvania.
If you are depressed about farm prices you can join 95 percent of the individuals I have addressed regardless of geographic region or enterprise.
The most interesting question was, "If you were an advisor to the Secretary of Agriculture, what would be a couple of your mandates?"
First I would create a Rainy Day Fund for agricultural producers similar to Canada and Australia. If we are going to play in a global market with prices being impacted by weather, political and military posturing, then mechanisms for proactive risk management are needed.
Producers should be allowed to set aside up to 10 percent of gross revenue (tax deferred) in savings or Rainy Day Fund. This could be partially matched by government with opportunities to earn money-market rates. This is an example of where government, producers, and lenders could work together for a more competitive agriculture.
Second, I would create a public relations program for agriculture to educate the general public concerning the industry. This program could be developed by our youth in 4-H and FFA at colleges and universities to empower youth and bring new energy to the industry.
A young FFA treasurer who was a sophomore from Mendota, Illinois wanted to invest 20 percent of their net profits from their test plot in stocks, bonds and mutual funds. His justification was that young people need to learn money management and diversification strategies. The power of youth!
Tip of the Week
Interest rates usually have to decline by more than one percent before the refinancing strategy becomes beneficial.
Dave's Sport Pick
No clear front runner for the NCAA Tournament. As the late Al McGuire (coach of Marquette) used to say "Watch out for the teams with two names!" Could this be the year a 16th seed upsets a number one? Parity in college basketball.
The week of March 5th through 9th I will be North of the 49th parallel in Manitoba, then south to Madison, Wisconsin. I will also be at the winter show in Valley City, North Dakota.
Send me questions or issues that you would like me to address or to react to!