What's going on?

Deere & Co. posted better-than-expected earnings late last week, as the company�s agricultural equipment became a must-have for a congested industry.

What does this mean?

Crop prices have been booming lately, and Deere has reaped the rewards: farmers have been spending more on its machinery to meet demand, bringing the company�s quarterly revenue and profit ahead of expectations by 11% and 16% respectively. And while that boom has started to taper off a little, it hasn�t dampened Deere�s optimism: the company hiked its earnings forecast for the rest of the year.

Why should I care?

For markets: Bellwethers work both ways.

Deere is considered an economic bellwether, with investors using its updates for clues about the state of the US economy. But it works the other way too, in that a weakening economy weighs on the manufacturer�s stock. Poor Deere: Goldman Sachs just lowered its US economic growth forecast, while Invesco�s broad index of commodities � which has moved almost in lockstep with Deere�s stock since October 2020 � has been on the decline. Investors, then, might be feeling a bit nervous about adding more of its stock to their portfolios.

Zooming out: Little investor on the prairie.

And you thought your mid-pandemic purchases got weird: the US government estimates that around 30% of the country�s farmland is now owned by those who don�t actually farm themselves, with Bill Gates becoming the biggest landlord last year. Farmland rental offers a steady income, after all, and the land itself is likely to keep rising in value as it becomes more and more limited a resource.