This was originally published on RealMoney in two parts. Both parts are being republished as one article as a bonus for TheStreet.com readers. For more information about subscribing to RealMoney, please click here.Part 1: How Rising Commodity Prices Are Having 'Real World' Effects The incredible rally in a broad range of commodity prices has captured the imagination of many and is creating a cruel dilemma for policy makers who need to be concerned about inflation even as economic momentum wanes. The April statement of the G7
'Real-World' EffectsPeople are responding to price changes. Car sales in the advanced industrial countries have generally fallen, and smaller-engine vehicles are being favored when purchases are made. Americans are driving fewer miles. In Paris, a new 30-minute free bicycle rental program has been launched. Farmers are planting more grain. The world output of wheat, for example, is poised to increase by 8.2%, with the U.S. winter wheat crop (panted in the October-through-November 2007 period) expected to be more than 17% larger than last year's and the largest in almost a decade. Wheat prices are near nine-month lows. The prices of corn, rice and soybeans have fallen this month.
Cramer: Ag Plays Are Twice Blessed (Jun. 9)
Water FuturesThere may not be a water futures contract, but water is a precious commodity and one that is becoming scarcer. The global use of water tripled in the 1950-2000 period, and the water table is falling in countries that are home to half the world's population. Almost three-quarters of the water is used for irrigation, and during the last half century, the amount of land being irrigated also tripled.
Altucher: Get Filthy Rich Off Dirty Water (Mar. 21)