Monday, November 29, 2010

Money in The Food Industry

Infographic by Discountvouchers.org

Twinkie Diet?


Being the calorie-counting, organic-eating health nut that I am, imagine my anger and frustration when I heard about the Twinkie Diet.

As an experiment, Mark Haub, a human nutrition professor at Kansas State University, lived off of Twinkies, Doritos, Little Debbie Zebra Cakes, and Mountain Dew for 10 weeks and actually lost a whopping 28 pounds without changing his exercise habits. What’s even more shocking is that his bad cholesterol went down and good cholesterol went up.

Take that Weight Watchers!

But what about all the high fructose corn syrup, Trans fats, and chemicals chemicals chemicals? Were the dozens of health and nutrition books I’ve read complete BS?

Two takeaways from Haub’s experiment:

Firstly, good or bad, a calorie is a calorie. Haubs did cut down his daily calorie intake by about a half during the 10-week period, even though they all came from junk foods. A common misconception is that all healthy foods are “skinny”. But consider this example: 2/3 cup of Nature’s Path Hemp Plus Granola has 260 calories; 2/3 cup of Kellogg’s Fruit Loops only has 118 calories.

Secondly, skinny ≠ healthy. Haub may have lost weight, but it would very hard to convince any health aware person that the Twinkie diet is sustainable. And it goes back to the lesson that we learned from failed diets like Atkins, that a balanced diet is still key. 

Wednesday, November 24, 2010

No Thanks, No Giving

No turkey, sweet potatoes, or pumpkin pie for Angelina Jolie this Thursday.

Uh-uh.

This is not because she’s on a diet, but because she hates Thanksgiving and doesn’t believe in the “celebration of murder”. Poor Brad – if he wants turkey, he’s going to have to stuff it himself.

But is Thanksgiving really about celebrating the Pilgrims’ harvest anymore? Or has it turned into another commercial holiday that gives people an excuse to feed themselves silly and for retailers to lure sales on Black Friday? 

Monday, November 22, 2010

Holy Chicken


If you want a spicy chicken sandwich from Chick-fil-A on a lazy Sunday afternoon, you’re out of luck.

This is because all Chick-fil-A stores are closed on Sundays so the employees can go to church and spend time with their families. And while the mission of its main competitor, KFC, is “to sell food in a fast, friendly environment,” Chick-fil-A’s mission is to “glorify God.”

Sounds more like a religious cult than a fast food restaurant? Here are more interesting facts:

  • Chick-fil-A’s company meetings and retreats include prayers.
  • The company’s founder and chairman, S Truett Cathy, teaches Sunday School classes at the First Baptist Church in Jonesboro, GA.
  •  Instead of Barbies and Beanie Babies, Chick-fil-A gives out toys from the children’s Christian TV show VeggieTales and CDs from the Christian radio program Adventures in Odyssey.
  • Muslim former employee, Aziz Latif, sued Chick-fil-A after he was fired for refusing to participate in company prayers.
For many, the question is much more complicated than “Chargrilled or Spicy?” – to Chick or not to Chick has become an emotional battle between hunger and moral believes.

Personally, I try to waste my time on more important decisions, and when I want Chick-fil-A, I’ll have Chick-fil-A – well, except on Sundays. How about you, would restaurants’ affiliations influence your dining decisions? 

Wednesday, November 17, 2010

Buzz Kill


Four Loko – better known as “Blackout in a Can” or “Cocaine in a Can” – has been banned in several states, infuriating college students across the country.

One 23.5 oz can of this alcoholic energy drink, a product of Drink Four Brewing Company, contains up to 12% ABV – equivalent to four beers, the same amount of caffeine as a tall Starbucks coffee, and costs about only $2.50. No wonder it is the go-to drink for many sober, tired, and broke college students.

However, caffeine (stimulant) + alcohol (depressant) + mindless partying = disaster. Four Loko’s fruity flavors and caffeine’s ability to diminish the perception of being drunk make it very easy to chug large amounts of the drink without realizing how much alcohol is actually going into your body.

Just last month, Four Loko sent 23 Ramapo College of New Jersey students and nine Central Washington University students to the hospital.

So whose fault is it? Is it the students’ for their lack of intelligent decision making? Or is it Drink Four Brewing Company’s for simply operating a business. States seem to think that the company is to blame – Four Loko has already been banned in Utah, Michigan, Oklahoma, New York, and Washington. More states are also likely to jump on the bandwagon. In response, the company has announced that it will remove caffeine from its products going forward.

Just like I don’t believe McDonald’s shouldn’t be punished for child obesity,  I don’t think Drink Four Brewing Company should be held responsible for irresponsible college students. There might be no more Four Loko, but as long as there are still Red Bull and Vodka, reckless party-goers will still find a way to be sent to the hospital.

How about some alcohol safety education instead?

Sunday, November 14, 2010

Food Prices - To Fear or Not To Fear?

Brian Shactman warned us: food prices are expected to rise sharply. 

True.

JPMorgan analyst Charles Grom has stated that the Food at Home Consumer Price Index (CPI) increased in September for the fifth consecutive month, which indicates that retail food prices will continue to rise.

While it is obvious that food retailers, like any other business, want to squeeze as many pennies from their customers as they can, I believe that there are two fundamental reasons behind the food price hike: supply and demand.

Firstly, global food supplies have been decreasing due to natural disasters and increased biofuel productions.  Pakistan’s flood, China’s drought, and Canada’s adverse weather this year have all halted agricultural productions and destructed crops. Moreover, Russia’s export ban on grains, in response to a drought that ruined nearly 20% of its crops, has further depressed global food supply.

Since the beginning of time, humans have had to fight with other humans and animals for scarce food sources. Nowadays, there’s a new player on the field: biofuel. Countries are ramping up biofuel production in an effort to combat global warming and reduce their reliance on foreign oil – thus far ethanol production alone has increased by 16.2% in 2010. This means that more soybeans and corns are being used to feed biofuel plants rather than people. We might be hungry one day, but hey, at least we’ll have cleaner air to breath.

Secondly, global food demand has been increasing due to population growth and the attractiveness of the commodities market. It is estimated that 200,000 people are added to the world food demand every day. Not only are there more and more stomachs to fill, but these stomachs prefer more meat (I guess they don’t care much about global warming). Statistics show that meat consumption has doubled since 1961 and is expected to double again by 2050. As a result, more livestock is raised in order to meet higher consumption needs, which adds to the food demand for crops – our food is eating our food.

Moreover, the commodities market has become very attractive in recent years because of economic uncertainties and a weaker dollar. When market uncertainties are high, investors withdraw from the riskier stock market and choose to invest in safer assets, such as commodities, instead. Furthermore, many commodities are priced using the USD. When the dollar depreciates, these commodities become cheaper for foreign investors to buy. The increase in the demand of commodities caused by these two factors is reflected through the record high commodity prices: the price of live cattle has increased by 14% year-to-date, wheat by 29%, corn by 37%, and coffee by 38%.

A simple supply and demand graph shows that either a decrease in supply or an increase in demand will cause an increase market equilibrium price. But when both occur simultaneously, as in the case of food, this increase is greatly amplified.

Many people have already started waving red flags and calling this a “food crisis”. A USAToday poll shows that 73% of American consumers are concerned about rising food prices. If you’re one of them, here is my advice:

Stop.

It is an unfortunate reality that food price increases have caused starvation and social unrest in many third-world nations. However, if you are Joe or Jane Doe living in a developed country like America, increase in food prices will not affect you, at least not in the short term, for three main reasons.

The first is that American consumers’ demand for food is inelastic, which means that price changes don’t greatly affect the amount of food purchased. This is because food is a necessity – we need food to live. If prices go up, people will spend less on luxury goods so they have more to spend on food. Another reason for the inelasticity of food demand is that Americans spend less than 10% of their income on food. Even if food prices grow by a few percentage points, this fraction will still remain relatively small. For the average American, therefore, food is not a big purchase decision since it has such a small impact on our disposable incomes.

Good ol’ American capitalism is the second reason why food price increases shouldn’t freak you out.  In a capitalist market, grocery stores, restaurants, and other food retailers get to decide upon the prices they charge their customers. They have great incentives to keep prices low compared to their competitors, in order to attract customers (unless the retailer offers a product which no one else does). Therefore, even when prices of ingredients have gone up, food retailers are often reluctant to pass this increase onto their customers for fear of losing business, especially during this period of economic recovery, when everyone is pinching pennies. Plus, don’t worry, they won’t gang up on us and raise prices in unison; there are laws against that.

The last reason, and the one we can most rely on, is the “oh-so generous” American government. The National Inflation Association reported that “food stamp usage in the US has now increased for 14 consecutive months. There are 39.4 million Americans now using food stamps, up 22.4% from last year. The US government is now paying out more to Americans in benefits than it collects in taxes.” If Washington coughed up over $182 billion to bailout AIG, it sure is not going to let its citizens starve.

But Americans shouldn’t stop caring just because we’re off the hook – food security is a serious problem in many other parts of the world today. Starvation and social unrest caused by rising food prices have become common in developing countries such as Egypt, Haiti, Mexico, Morocco, Nepal, and Yemen, where there are no capitalistic market structures and stable governments in place. Food is also subject to elastic demands in these countries, as people must spend nearly 80% of their income in purchasing it. So when food prices go up, they have to choose between food and shelter. Not, as in the States, between food and a new car.

The UN World Food Program and the UN Food and Agriculture Organization have already taken crisis response, supply response, and policy support actions in response to global food security issues. Americans can help by donating to one of the food crisis related organizations. But most importantly, don’t take our full stomachs for granted – before throwing away the leftovers next time, remember that there are starving children in Africa. 

Monday, November 8, 2010

Happy No More


McDonald’s Happy Meals just got less happy in San Francisco.

On November 2, San Francisco’s Board of Supervisors passed the law that bans toy giveaways with unhealthy restaurant meals for kids, effective December 1. Movie characters, Barbie dolls, Lego pieces, and Hot Wheel cars will be replaced with plain ol’ crayons (if the kids are lucky) unless the kid’s meal has less than 600 calories, contain fruits and vegetables, and include beverages without excess fat or sugar.

The law is designed to promote healthier eating habits and lower the disturbingly high obesity rate among children. Even though the law applies to all restaurants, it is not surprising that McDonalds, having had its Happy Meal Toys since 1979, is the most outraged. “We are extremely disappointed with today’s decision. It’s not what our customers want, nor is it something they asked for,” McDonald’s spokeswoman Danya Proud said in a statement.

While I am supportive of the intentions of the law, I don’t think that restaurants should be the ones to get punished. McDonalds is not to blame for children’s bad eating habits – they’re only doing business. Children are not to blame for their own bad eating habits – they don’t even know what a calorie is yet. Parents are to blame – they’re the ones that determine their children’s eating habits. If parents don’t buy their kids Happy Meals, the kids won’t have Happy Meals. 

So where is the law that bans parents-who-take-their-kids-to-McDonalds? 

Monday, November 1, 2010

Prop 19: Just Say Yes

Proposition 19 has the potential to end marijuana prohibition in California tomorrow. After almost 100 years, it’s about time.

If passed, Prop 19, or the Regulate, Control and Tax Cannabis Act of 2010, would make lawful the possession and sharing of one ounce of marijuana outside the home, personal cultivation of a small marijuana garden, and possession of its harvest in the home. However, prohibitions against driving and working under the influence and furnishing marijuana to minors would be maintained.

In his piece on The Huffington Post, Russ Belville lists 19 reasons why six distinct groups in California should vote yes on Prop 19. These six groups are:
  •          Concerned parents
  •          Law enforcers
  •          Medical marijuana patients
  •          The business community
  •          Latinos and African-Americans
  •          People of all political ideologies

If Belville hasn’t convinced you, multibillionaire investor George Soros, former police chief Joseph McNamara, the California American Civil Liberties Union, and former US Surgeon General Dr. Joycelyn Elders are just a few other active proponents for Prop 19.

Furthermore, according to the National Household Survey on Drug Abuse, the percentage of reported past month use of marijuana increased in all age groups since the 1980s. Why keep a useless prohibitive measure if it has done nothing to reduce marijuana’s availability or use when its removal could generate economic, social, and political benefits?

Vote yes on Prop 19.