How we individually believe markets work has a tremendous impact on our decision-making framework.
I'm sure many of you believe that the headline above is a very strange way to start this month's column. Possibly, but here's where I'm coming from:
One morning a couple of months ago, I read an article in the Milwaukee Journal-Sentinel about a motivational speaker who was bringing one of his "mega" seminars to the city. It was one of the classic seminars with big name speakers such as Colin Powell, professional athletes, etc. The fees to get in the door are enormous and the individual sponsoring the meeting has written books in addition to sponsoring seminars on motivating people.
The article discussed the pros and cons of these meetings and whether or not they really do anyone any good. As with most articles, it focused on the negatives, but hidden within was a major positive that reminded me of helping farmers with marketing.
The key issue, and the key to this man's success, is that of changing people's "beliefs." One reason many people are not successful in life is simply that they have the wrong beliefs. The more I thought about it, the more I realized that, for the past 25 years, that's what we've been trying to help farmers do - change their beliefs.
At the risk of alienating some readers while entertaining others, I've made a list of beliefs that are very strong among some farmers. All of them frequently (but not always) lead to poor marketing, unprofitable farming operations and oftentimes a negative attitude. While I'm sure there are others, bear with me as I go through the Top 10:
1) The government controls commodity prices.
2) The grain companies control commodity prices.
3) Big business, big banks and certain religious organizations are out to put all farmers out of business.
4) The Chicago Board of Trade is fixed. No way a farmer can win in that game.
5) I know as much as anybody about the market because I grow the crop. "If I don't know it, it ain't worth knowing."
6) The commodity funds push the market any way they want.
7) The majority of farmers do a better job of marketing than do farm market advisory firms.
8) It doesn't matter what I do in marketing, anyway. If I do well, I just have to pay it to the government in taxes.
9) I have the bins; I might as well use them.
10) No need to worry about marketing. As long as I grow a big crop, government programs will keep me in business.
Stop and think about the impact of these beliefs on people's decision-making process, especially those who believe in one of the first six points. They'll never be willing to make any marketing decisions. They're convinced that, no matter what they do, the whole game is fixed and there's no way to win.
These are emotional hang-ups that some people frankly will never be able to overcome. Unfortunately, if they don't overcome them, the only way they're going to be able to continue farming is to have a big net worth to start with and then watch it gradually disappear over the years.
Universities, companies such as ours and our competitors', and many other people involved in the education system, can do seminars teaching farmers how to use futures and options and develop marketing plans. But all of it is wasted if the people listening are hung up on any of the above beliefs.
Particularly as times change, an open mind is a tremendous asset. A closed mind with bad beliefs and bad habits will rarely accomplish anything positively.