By Kaitlyn Ersek on Mar 27, 2020 10:49:25 AM
The Coronavirus pandemic has been churning up a lot of uncertainty for the farmer, the investor, and the agtech entrepreneur. Earlier this week, we had the opportunity to conduct a webinar interview with Kevin Van Trump, President of Farm Direction and The Van Trump Report, on Helping to Create Certainty in an Uncertain Time.
A big thank you to everyone that joined us for that webinar. For those that weren’t able to tune in, see the full webinar recording below. Or skip the webinar and review our 3 key takeaways.
Please note, Kevin is not registered as a stock or commodity advisor. Please see the disclaimer from Kevin at the end of this blog.
Kevin Van Trump looks at the macroeconomy and the phases of a bear market
According to Kevin Van Trump: Well respected investor Richard Bernstein, reminded me that bear markets tend to have three-phases.
- Phase One of any bear market, people tend to say this is only temporary and it's not going to last. I can't remember one bear cycle in any market that didn't start this way. Bulls always say this is just a temporary setback and things will soon be back to normal, it's just a blip on the radar.
- Phase Two of any bear market people tend to start saying this is a lot worse than anyone could have imagined. We knew this was going to happen and should have seen the writing on the wall.
- Phase Three of any bear market people start saying it's never going to get better and it was so obvious. They are not calling brokers and asking how they can put more money to work or what they should be buying, instead, they are calling and saying just get me the hell out!
I personally think we are somewhere between phase-1 and phase-2. Big buying opportunities are almost always seen when people are 100% throwing in the towel, not when people are arguing about if it's a bottom or not. Perhaps the biggest question we need to ask ourselves is if this is just a bull market break or is this now a bear market rally?
Skip to 26:00 - 55:00 in the webinar recording to hear the story.
Kevin discusses sustainability pressure
According to Kevin Van Trump: Studies conducted by Severe Weather Europe have shown that the world typically sees an increase in CO2 emissions in the colder months in the Northern Hemisphere. However, this year has been different. In fact, there have only been two years since 1975 when CO2 rose less since the first of the year.
If you have not seen the NASA satellite images of pollution reduction in China or the recent tweet we shared of the change in Venice canals over the four weeks of lockdown, you should check them out. Images from above China are showing a drop of -25% over that period of time and now have many wondering what a future powered by "clean energy" could look like following the crisis. Experts are already saying emissions are likely to drop a great deal even when we come back online, thanks mostly to the trend already driven by the closure of coal-fired power plants. Keep in mind, the last time global emissions fell noticeably was in the wake of the Great Recession, from 2008 to 2009 when U.S. GDP fell -4.3% and unemployment doubled from 5 to 10% with housing prices crashing and the stock market losing more than half of its value.
When “social distancing” ends, it will become important for people to get back out there, but governments will most likely play a huge role in how that looks. Should more money and investments be shifted towards low-carbon alternatives and industries, then perhaps we will start to see a larger paradigm shift in how society and business function as a whole.
One thing for certain, the recent Corona crisis is only going to exasperate and push more political interest and focus towards keeping us healthy, safe and sustainable. As I've mentioned time and time again, we have to think long and hard about how we are going to farm in a world that is increasingly more focused on Climate Change, Clean Energy and Healthy alternatives.
Skip to 1:06 - 1:10 in the webinar recording to hear the story.
Barrett’s lesson on gratitude and how we can’t control what happens to us, only how we respond to what happens to us
When Barrett was running his lawn care company, his warehouse burnt down. No one was hurt, but the business lost ~$700K in one day. Instead of giving up, Barrett chose to see that day as a gift. He believed that by approaching his adversity with an attitude of gratitude, he would be able to find opportunities within the chaos.
The result? That was the moment Barrett implemented the original formulation of Holganix Bio 800+ in his lawn care company. Without that fire, there would have been no Holganix.
According to Barrett: We can’t control what happens to us, we can only control how we respond to what happens to us. If we look at what’s happening with Corona and all the things around us that seem out of control, we must realize that what we do have control over is our response to what’s happening. If we can slow down, take a deep breath, and focus on the things we can invest in - our families, our farms, and our soils - and do the best we can there and have an attitude of gratitude and abundance, then we’ll get through this.
Skip to 6:00 - 25:00 in the webinar recording to hear the story.
Donate to help fellow farmers; American Farmland Trust
American Farmland Trust just launched a Farmer Relief Fund to help farmers affected by the Covid-19 crisis. All donations raised are given to farmers. The fund awards eligible farmers with cash grants of up to $1,000 each to help them weather the current storm.