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Politics : Politics for Pros- moderated
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To: LindyBill who wrote (282816)12/3/2008 2:11:00 PM
From: skinowski1 Recommendation  Read Replies (1) of 793600
 
People, on some level, must love to have once in a while a good scary bear market. We need to see contrasts - light as opposed to dark, good - to evil, and so on. Booms must be interrupted by busts. Periods of optimism and euphoria will be inevitably followed by times of fear and uncertainty.

At the same time we live in a world of physical realities. The total amount of (relatively) accessible oil is one such reality, and it appears to be limited. Similar limitations are less evident with regard to most other commodities.

The most important aspect of globalization is the migration of hundreds of millions of people from extremely poor regions of the world towards urban centers, where they become participants in the global economy. This increases the total amount of wealth in the world, which is wonderful. However, at the same time this creates new - well, let's call an ace an ace - Malthusian pressures on our supplies of commodities.

I think that the secular long-term picture for commodities in general remains bullish, by any measure. How far down prices may go as a result of this (large scale) bear market - that is hard to tell. I think in this respect energy prices are more likely than other commodities to surprise to the upside - because much of the demand appears to be rather fixed and probably not as flexible as many believe. Last summer we experienced panic buying - now, we have panic selling... and this too shall pass.
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