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Agriculture and the Black Swan

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Dr. David Kohl
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Home > Education & Events > May 2020 > Agriculture and the Black Swan
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Hi, I'm Dr. Dave Kohl, Professor Emeritus, Agriculture Economics at Virginia Tech, Blacksburg, Virginia. The title of my talk today is “The black swan has landed.” Over the years, I've done a number of programs and I've always put a PowerPoint in there, the black swan. I've gotten ribbed over the years because I said, "Well, there's possibility of a cyber attack or a disease outbreak." Well, the black swan did land. And I really feel it's going to go through three stages. And I want you to think about this. The initial stage was from about the 1st of March and it will go through about the 1st of May. All of us have been hit by the sudden shock. Job losses, unemployment, uncertain markets out there. This has basically been a demand destruction, not only here in the United States and around the world, which has impacted commodity prices, but it's also impacted all of our personal lives.

I think the second stage of this, the black Swan is going to turn to an angry bird. And what you're going to see in the second stage, it will go from about May 1st to about the first in the year. You're going to see a lot of debate of whether we should trade with China. In other words, globalization versus selective de-globalization. What do we produce here in the United States? You're also going to see various plans being criticized that'll come out of our leadership and our government, not only at the national level, but the state and actually the local level. After this second stage, what you're going to see is the phoenix will rise. In other words, it's the mythical bird. And one of the things that you're going to see is a regeneration. And one of the things I'm optimistic about agriculture is agriculture entrepreneurs is alive and well.

And I really see particularly the younger generation thinking entrepreneurially and what they will do is they'll find innovation and new ideas that they can bring to the agriculture industry in this post COVID environment. In the meantime, a couple of things that we're doing in our agriculture business, which we have the dairy, creamery, and also the dairy farms, we're really monitoring our financials. At the other end of this table, I just spent four hours going through our financials. Here's the projected. Here's the actual. Also, one of the things that we're trying to do is look at individual expenses. What's going to be necessary? What is a want versus what is a need?

Keep a handle on your personal finances out there, because that's going to be very critical as we kind of look at family living costs. But when it's all said and done, keep a couple of things in the back of your mind, keep your emotional health up, do some exercise out there, do some positive readings, engage with positive people. And one of the lessons I learned from the 1980s, you never equate your self-worth to your net worth because it can be very fleeting. And there's a lot of other positives out there in life. I want to wish you all well up in the upper Midwest and the Midwest. And hopefully, sometime here in the future, I'll see you in a face-to-face event. Best wishes to you all.
 
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