Food Crisis Puts Spotlight on Resource Stocks

We're entering a long-term and politically dangerous food crisis with far fewer resources than necessary to sustain a growing global population, but the financial markets and governments badly underestimate these risks, says GMO's chief investment strategist

Jeremy Grantham, GMO, 9 August, 2012 | 12:20PM
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This is a "Perspectives" article from Jeremy Grantham, the British chief strategist of GMO in the US. Watch an hour-long special featuring Grantham talking on investing in a slower-growth world by clicking here (please note this video is available to Premium members only).

Summary of the Summary
We are five years into a severe global food crisis that is very unlikely to go away. It will threaten poor countries with increased malnutrition and starvation and even collapse. Resource squabbles and waves of food-induced migration will threaten global stability and global growth. This threat is badly underestimated by almost everybody and all institutions with the possible exception of some military establishments.

Summary
1. Last year we reported the data that showed that we are 10 years into a paradigm shift or phase change from falling resource prices into quite rapidly rising real prices.

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