Market Plus with Ernie Goss and Chris Robinson

Paul Yeager: Welcome back to our holiday table for the Friday, November 28th, 2025 installment of Market Plus. Want to let you know we are recording this on Tuesday ahead of the Thanksgiving holiday. Chris Robinson Ernie Goss. Here in what has become, Ernie, a  Thanksgiving Tradition.

Ernie Goss: Turkey table.

Yeager: Turkey table. I'm not calling you a turkey. Next year, maybe we'll bring turkey and trimmings and have a meal. All right, I need to ask the professor a quiz question. Like you're writing a test here. Right before this week. Take the Tyson story out of the factor. Take your survey out of the factor. Biggest story impacting the rural economy is A) inflation. B) grocery store prices. C) the Supreme Court's decision looming on tariffs or D) Russia-Ukraine which one? And give me 30 words on why.

Goss: Russia - Ukraine simply what they'll do to reducing tensions across the globe, in my judgment. So that will have some huge impacts in terms of gold prices, for example, all asset prices. We've talked about before, but also the Supreme Court decision that's going to be monumental. Let's just put it that way. If they ruled that the president cannot implement these tariffs and call them taking emergency measures and taking away Congress's prerogatives, that's going to be huge. And I think as a matter of for as an economist, what we hate is using this tariffs as sort of a for every, every problem, every the solution is tariffs. And it doesn't matter whether it's in Brazil. And I really don't like to see that. And I'm a fan of President Trump. And I, but I'm not, I can't say I'm a fan of a lot of things that have gone on though, than the tariffs are just one of them, those they need to be reeled in. And the we surveyed, of course, bank CEOs. And I think their idea, their belief is that this is negotiating. Well, if it's not working. In other words, president is, he's a business negotiator, whether it's a winner or a loser. Well, in trade and particularly in agriculture, there's a winner, winner, loser, loser. And that's what we're talking about. In this case, we lost China, lost a lot of losses out there right now.

Yeager: Chris, when you look at the same question, I want to tailor it just a tiny little bit to you. We always talk about black swans and we'll get to a black swan question here in a minute. If we know that Russia, Ukraine, there's this push to get some end to this, we know that the Supreme Court is going to rule on those things. If I'm the producer watching this, what am I to do? Knowing these two things are looming and could be happening soon.?

Robinson: Instead of hoping that things get better, take advantage of what we have now and defend your business risk. And what does that mean? Get your risk on paper. We just, I just mentioned we had $1.50 rally in soybeans a month ago. We were worried about soybeans sub- $10. Here we are at $11. Don't worry about why. Worry about what happens if you just watched the contract go up $1.50? Multiply that by however many bushels you're growing. I don't care if you're growing 5000 bushels or 50 million bushels. Protect that revenue. We don't have as much meat on the bone for wheat, certainly, or even corn. But, you know, we don't want to be in a situation where we're back where we were in 2013, where we were like, oh, wouldn't it be nice to have $4 corn? Nobody wants to see corn with a three in front of it. So in my business is about, you know, defending against the worst. So defend what you can. Don't overspend. But you know that this is all coming down. So you don't need to go buy 100, 200 days worth of protection. You can buy a month or two and say, okay, we'll sit here, what happens and hope, hope, hope that you don't need your downside protection. Hope that soybeans go to $12. Hope that corn goes to $5. You know, everybody hopes that anyhow. So defend what you can and try and stow your opinions. It's really, really easy to get very, very emotional and make bad emotional decisions. We're all going to find out together what's going to happen. You know, so.

Yeager: Well Andy A. wants to know in a question that he sent in here. Chris, is it would appear that it almost, that we have gotten all of the black swan out of the way in the cattle market. What are your thoughts on the next floor and maybe what could cause it?

Robinson: The next black swan? What if you got to worry about what's going on with Japan and China and the U.S. now? I mean, the Prime Minister, I believe the prime minister of Japan, she's a woman. She basically said, oh, yeah, if anything goes wrong in Taiwan, we'll be there. China did not like that. In fact, that's one reason why yesterday the president said, oh, the meeting went really well. They had another phone call. Now the president's going to go meet him in April. So that's the issue. China wants to be able to keep telling their people that they're going to get Taiwan back and that that's going to be the real issue, because if we just got, you know, we just got something that seems to have been settled in the Middle East. We just might be getting something subtle with Ukraine. So what's the last thing out there that could bother us would be something happening in Taiwan that nobody saw coming. And then if that happens, then it's flashbacks to Jimmy Carter and the Olympics were like, we're not sending any more anything any, you know, with the embargo and that's that's what you don't want.

Yeager: We already didn't send people to COP, which you could argue that's the administration's view on environment. We didn't send anybody to the G20 last week in South Africa. So I mean, those things are pretty much on the table. So what happens when we don't go to these national or, I'm sorry, these global events or any as a nation economically?

Goss: Well, it sends a message, of course. And that was the intent, in my judgment, that we're negotiating hard. In other words, we're the big dog. So you got to come to us. I don't well, I.

Yeager: Are people coming to us?

Goss: I don't see them coming to us. Some of them are. And we do hear about trade deals. All right. We're going to Japan and have agreed to this. China's agreed to that. That's that's talk. Let's see it in action. Let's see that plant that was going to that was going to Reshore, reshoring to us. We haven't seen it yet. I just and so and as Chris said, one of the things right now is really watching is Japan. I mean here they've handed off this to the first woman prime minister, and she's like, this is what you do to your women. This is not it. She's got a tough situation because the interest expense in their hours is going crazy. Theirs is going much crazier. So what does it mean to us? It means that they were buying. They were buying our bonds, bringing down our interest rates. Long term particularly, they're not going to be buying our bonds to any great extent. They're going to be paying out interest there. So our interest rates are going to be springing higher. So back to the issue. You mentioned the issues. Inflation is the next one of those numbers that I think you name five.

Yeager: I did.

Goss: And that's the third one.

Yeager: Okay. You mentioned about you'd like to see another rate cut in December. Let's talk with your bankers that you have conversations with. How willing are they to be writing farm loans? Are they writing to the same level that they've written them in the past?

Goss: No, they're not, they're not. But, they're being judicious. They're still making the farm loans and it is tough as I've just portrayed it. Farmers are still paying back their loans. Delinquency rates are up but not up significantly. There are bankers remain. The loans are up, but not what you'd think. And with interest rates coming down a bit now, that's on the short end. We you know, everyone says, well, they're reducing these interest rates. On December the 10th. That's what Goss has said. Well mortgage rates will come down. No mortgage rates are long term. They're not set by the Fed. The set the Fed influences them. And in fact, the last time they did this, in the fall of 2024, actually, they cut short rates. Long rates went up. So the idea that long rates will come down is not correct, not necessarily correct. But I do think we're in a period of even with that said, I think we're in a period of lower, somewhat lower long term rates as well as short term, and that'll help out. That'll help out in terms of loans. It'll help out in terms of farm land purchases, but not as much as we need to see. We need to see rates much lower. But back to how can I argue that when I just said inflation's the third, the third one of those problems, Ernie Goss says reduce interest rates. And he said one of the biggest problems is inflation. You're right, there are so many contradictions out there and that's one of them.

Yeager: It makes it hard to navigate. It is to understand what it is. And again, when you're already out of hands, yeah. As a one handed economist, you know, as it would go.

Goss: Well Jay Powell. Jay Powell is caught really between a rock and a hard place. What does he do? And the answer is he's getting beaten up by the president you know.

Yeager: But does he, I guess, this is the discussion we've had internally here without the data because we weren't collecting certain things in October and November. Powell is not going to have that data to rely on to make some of his decisions. He's going to have to rely on other things that have a little more weight and less hard data, right, to make some of his decisions, which makes him open to way more criticism. Right?

Yeager: Absolutely. And they gave us a number, 119,000 jobs. That's the BLS gave us this number. And by the way, those numbers have wide, wide confidence intervals. In other words, the error is big, 119, and everybody jumped for joy 119,000 is not that good. We need more than that. The ADP, the private number came in. Those are negative. Creighton’s numbers are negative. The national PMIs are negative. Manufacturing. Now again I'm overstating it. It's not it's not that it's not horrible. It's not a crisis. But we're not doing well. Let's just put it that way. When the president says this is the best economy ever I'm like, oh, what is?

Robinson: He likes the stock market.

Yeager: You would need to. Yeah. Look, you would tell the students, show me your work. That's right. Okay. I'm getting to the end of the time here. Chris, I got to ask you an actual like commodity question here. Let's do Brad in Kansas, if we could, Josh and Brent, do you agree with the USDA yields for corn? And will they adjust in January or wait until August when farmers have sold?

Robinson: It doesn't matter if I agree with them or not. I just trade the price. I learned a long time ago when I was just young. In this business, you can be right and still lose money. So you want to win the battle, or do you want to just deal with the prices we have? So a lot of energy is wasted on arguing with the yields are I know it's important. I know that it matters. I know that it's you know, but at the end of the day, I'd rather have him say the yields are huge and have prices go higher anyhow and be like, why did that happen? The market discounts everything. That's the one thing about it. And free markets will do that. So yeah, you know talking you know you had Jeff on last week and we all talked at the same you know there's a whole group of us that talk. And we also talk to our clients. And yeah, in general it's not the yields weren't as good as they were last year. The question is and this is I don't know, because it's above my pay grade. Did we really plant all those acres. Because that's what was the really embarrassing thing. The extra acres was like, okay, well we're going to lower the yield. But look at all these extra acres. So that is the key. And guess what? We won't find out about that until January 10th. So if you don't do anything this year, hedge for the January 10th report.

Yeager: Yeah. And the reason I tied those two statements together is because of there's that gap in data. We don't know and we just don't know. And it still is going to take us a long time to sort it out. And we might have it sorted out by July when we bring you guys back.

Robinson: Well then it'll be like the acres, the acres report in March, well, the January report, the final production number and then the acres report, because that will be the key. And it's that and then the one big is, can you tell me, is there going to be a drought? There's a drought. There's your second black swan.

Yeager: All right Chris Robinson everybody. Thank you Chris. Thanks Ernie Goss. Great to see you. Thank you so much.

Goss: Nice nice to be here. Good to see Chris as well. 

Robinson: Yeah good, to be here.

Yeager: Always enjoy you, too. And we enjoy you watching us. And I want to let you know that next week we're going to talk to some farmers who are trying to navigate the changes to labor policy. And our senior market analyst, John Roach, which, by the way, if you go to our YouTube channel, which we promoted at the end of the show, you can see John Roach's first appearance on market to market from 1977. It's available now on our YouTube. And this week's MtoM podcast. Thank you so much for joining us. Have a great week and a great, great Thanksgiving.

Trading in futures and options involves substantial risk. No warranty is given or implied by Iowa PBS or the analysts who appear on Market to Market. Past performance is not necessarily indicative of future results.