SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : Mish's Global Economic Trend Analysis
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: gregor_us who wrote (4375)4/15/2004 7:33:46 AM
From: russwinter  Read Replies (1) of 116555
 
<I'm getting the impression even the veterans are clueless about what happens next. >

The "playbook" on this appears to believe that all this commodity inflation is merely USD related, and thus has been put to rest by this USD rally. There are several major flaws to this:

1. The USD strength is not sustainable as long as we run trillion buck twin deficits, and maintain sub two percent interest rates. The economic strength that accounts for the temporary pop in the USD is artificial and hyper-stimulus induced. Once the heroin wears off (and it shouldn't be long), the patient (and USD) will be in real pain.

<secret supply upturn>

Well put!

2. There is a monster physical shortage factor that is getting worse by the day (*), especially in metals (focus on been mostly on gasoline). As the scant stockpiles get run down towards zero in the next several months (or even weeks)I wonder how the geniuses who run these playbooks wil react then?

(*) Yesterday's combined LME and Comex in copper was 362,813 MT, down a whopping 6,882 in one day. That's sixty days left at 6000 a day. There are no real signs of a slow-down whatsoever. FCX releases on Tuesday, April 20th, and I think the market is already discounting Grasberg at full production in May or June. Watch out if it's delayed.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News