Take a break from worrying about PIIGS and worry about regular pigs for a minute. With all the bacon that Jason and I have been eating, we’ve apparently driven the price of pork up so high that there are full-blown pig-rustling operations in existence nowadays. Seriously, though, a combination of increased demand for succulent hog, and decreased supply of piggies at market (since all the corn is going into our cars nowadays and not into farm animals’ gullets, making them more pricey to raise, and thus not particularly lucrative despite the higher market value) has made hogjacking lucrative. At $200 per piggie, swiping a few swine here and there adds up.

A scene from the Iowa-Minnesota border:

The pig rustlers back trucks up to unguarded hog houses that contain thousands of pigs, according to police. They load up a few dozen animals at a time into a trailer and drive off under the cover of night.

“I feel cheated and a little bit violated,” said [Ryan] Bode, 37 years old, who started [Rebco Pork Company] with his parents in 1994. “We’re the ones doing all the work to get these pigs ready, and then it comes time to sell them and they’re just not here.” Mr. Bode said he suspected the thieves made three or four sorties, stealing 30 to 40 pigs at a time.

The culprits? It reeks of an inside job, as it’s unlikely there are underground bacon rings operating stealth slaughterhouses (I swear, I’ve been busy with work and not running one of these); suspects include other farmers or possibly someone who has made a deal with a meat processing plant.

We at LOLFed, naturally, wish a pox (or at least a swine flu) on these ne’er-do-wells interfering with the normal operations of the bacon supply chain. Let our porkers go!

FED Chairman Ben Bernanke told Congress today that the economy is growing more slowly than expected, and should this anemic growth continue, the FED is ready to launch more stimulus.

“given the range of uncertainties about the strength of the recovery and prospects for inflation over the medium term, the Federal Reserve remains prepared to respond should economic developments indicate that an adjustment in the stance of monetary policy would be appropriate.”

Source: CNBC

I translated this statement and out came QE3.

The markets seem to have come to the same conclusion, as the major indexes are all up over 1% as of 1:30pm. Gold has jumped to 1585.60.

Speaking of Gold, Ron Paul asked the Bernank an interesting question:

Paul: Do you think gold is money?
Bernanke: (pause) .. No.
Paul: Even if it’s been used as money for 6,000 years… somebody reversed that? Eliminated that economic law?
Bernanke: Well, it’s an asset. Would you say treasury bills are money? I don’t think they’re money either.
Paul: Why do central banks hold it? Why don’t they hold diamonds?
Bernanke: Well it’s tradition. Long term tradition.
Paul: Well, some people still think it’s money.

Classic Bernank!! Sure, the banks could hold gold out of “tradition” but we never really got an answer from Ben on why he thinks gold isn’t money. Is gold a medium of exchange? Is it a store of value? Does Ben even understand this, or is gold just an intrusion on his fiat-money fantasyland? Who knows?

-Bill

PS: Alyx just informed me that we went through something similar in March.

Silver’s down? Well, call the Lone Ranger, that’ll cheer him up. Gold and oil, too? We could prattle for ages about whether the loller dollar’s rebound will continue to send shockwaves through the commodities market, but we won’t.

We just want to talk about bacon. Namely, the unmitigated pork cravings by those who dig on swine, and the record highs forecasted for the pork belly market.

First, consumption is up:

Pork belly prices are on pace to set records this summer as restaurants add bacon to everything from salads to sundaes. About 44% of U.S. consumers will eat bacon within a two-week period, which is a record high, according to consumer studies conducted by the NPD Group, a Port Washington, N.Y.-based market research firm.

Only 44%? The other 56% of you are slacking (and don’t try to give me some religious or health excuse, this is sweet nectar of hog we’re talking about here). Anyway, demand is doing exactly what you’d expect to prices:

Prices for pork bellies, from which bacon is made, are responding to strong demand, with analysts and traders predicting bellies will set new, all-time highs this summer of $1.70 to $2.00 a pound. Cash market prices reached a record of $1.60 a pound in September as belly supplies ran short. Recent federal data put the price of 14- to 16-pound bellies at $1.50 a pound, well ahead of $1.10-a-pound price a year ago.

This has left the price of a pound of bacon about on par with the price of a gallon of premium unleaded (fitting cuz I’d prob need to run 20 miles to burn off a pound of it):

Retail bacon prices climbed to $4.537 a pound for March, 23.7% above prices a year ago, but still below the record high of $4.773 a pound set in October, according to the U.S. Bureau of Labor Statistics. Pork belly futures also are above year-ago levels, but the contract is thinly traded.

We worry a bit about there being a “bacon bubble,” given its meteoric rise to stardom.

It was one thing when it was just foodies like us enjoying it at Baconfest and Cochon 555 (and it was nearly two years ago that we threw together the Hot Chicks With Bacon blog just because), but it’s another thing entirely when Denny’s has their marketing team make the calculated move to plop it on top of a sundae because it’s all the rage with the kids these days, so you have to keep an eye on the zeitgeist to determine if its fifteen minutes of fame are close to being up.

But that’s okay if it is, because that’ll leave more for me and Jason.

And I can’t write a post like this without leaving you with the best explanation of commodities, ever:

Yeah, apparently, these charges against Goldman Sachs are so serious that investors are unloading ANYTHING that has “gold” in the name. Gold futures took a nosedive on Friday, continue down again today:

Announced on Friday, the Securities and Exchange Commission action against Goldman Sachs hit major benchmarks around the globe, with Asian stocks falling early Monday in reacting to the news.

Gold was hit hard on Friday amid news that hedge fund Paulson & Co. was involved, although not charged, in the SEC’s complaint against Goldman. See related story.

Paulson “spun off another fund that has been very bullish on gold and is cooperating with the SEC in the Goldman charges,” said analysts at Action Economics.

Gold futures fell 2.5% last week, with much of the drop coming on Friday.

We’ve heard rumblings that Gold is considering changing its name to “Morganium,” though neither the World Gold Council nor anyone at $GS or $JPM was willing to comment.

Cerberus – the private equity firm named after that three-headed dog that guarded the gates of Hell, because Steve Feinberg thought it was “a good idea at the time” – arguably got the short end of the stick in the massive auto industry bailout, losing their equity stake in Chrysler and pretty much having to liquidate Chrysler Financial. (By “got the short end of the stick,” I mean “had happen what usually happens when you invest in a company that goes bankrupt,” of course.) Then they lost some more money by backing out of the United Rentals deal but since they’re still around I figured they had to be making some money somewhere these days.

I caught a Fox Biz headline out of the corner of my eye the other day that read CERBERUS INVESTS IN ALIEN BLOOD or something like that, which originally made me think that they had bought up GoldenPalace.com or something of that ilk and were bidding on curiosities on eBay, perhaps. That turned out not to be the case, alas – it was just your average sensationalist headline to go with the story that Cerberus Capital Management is taking a little bit of flak these days for setting up plasma outposts along the US/Mexico border. The difference between “vampire” and “vampire squid”:

[N]ow the blood profiteers of the pharmaceutical industry have moved their area of exploitation to near the Mexico-U.S. border, where workers are transported from Mexico to sell their plasma.

Esmeralda Delgado is one of these workers. She makes a mere $60 a week for having large amounts of her blood removed, then stripped of plasma and pumped back into her veins…As Delgado sits on a bed at a plasma collection facility in Eagle Pass, Texas, letting her blood slowly fill up a bag, she and her fellow workers/donors can look up at a banner that reads, “Save Lives. Earn Money. Feel Good.”

“Save Lives. Earn Money. Feel Good” sounds like a Wal-Mart slogan, though I think that organization is well aware that avoiding comparisons to bloodsuckers is in their best public-relations interest, and I doubt we’ll be seeing any “plasma for gift cards” donation clinics in their stores in the near future.

Cerberus’ expansion into border towns is postulated to have caused  a 25% decline in the compensation for plasma, which is what happens when you expand the pool of prospective donors to people who actually need money, instead of only hitting up only the already richly-tapped, college-student-in-need-of-pizza-money market:

The plasma center in Eagle Pass, near the Mexican border, owned by Talecris Biotherapeutics — a wing of Cerberus and employer of former Vice President Dan Quayle — recently cut the compensation for its worker/donors from $80 to $60. More working people are desperate for money, so, like “the reserve army of labor” that forces down wages, a reserve army of plasma donors is created as jobs fade away, homelessness soars and desperation becomes part of everyday life in the age of crumbling capitalism.

At least 15 plasma centers are located in border cities in Texas and Arizona. Talecris’ four newest plasma centers have also been built along the U.S./Mexico border, where workers are willing to sell their blood plasma at much lower costs.

Danny Q got his name thrown in, but I’m not going there, I’m just following the money. You’re wondering, what’s Cerberus’ bottom line on Talecris?

Talecris, a leader in the business, just raised $1.1 billion in an initial public stock offering. The transaction represented a handsome return for Cerberus, the private equity fund. Cerberus acquired what is now Talecris from Bayer in 2005.

NYT indicates that $30 in plasma can be turned into $300 or more in pharmaceutical products, possibly much more, when you consider treatments like intravenous immune globulin and clotting proteins where the retail cost of treatment is $100K-350K a year.

We’re really not socialists here, so I didn’t paste in much of the rhetoric surrounding this topic — and I’ll also readily admit the capitalist case that says this situation puts money in the pockets of people like Esmeralda Delgado and makes needed treatment available to sick individuals – but at the same time, I’m glad I’m not the person who has to prepare cost-benefit analyses or marketing plans for locating these clinics within reach of the maximum number of impoverished people, and even happier I have a cush office job that keeps food on my table.

Beyond the exploitation angle, the xenophobic-nationalist backlash could be interesting, too. I am anxiously awaiting the day I turn on C-SPAN and see Congress debating putting up a fence along the border to keep out the three-headed vampire Mexicans. (Quentin Tarantino movie premise, anyone?)

Thx to Jason for the Photoshop on this one.  I could only successfully vampire-ize Feinberg with sparkles and whatnot, and we hate that Twilight ish.