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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Elizabeth Andrews who wrote (10528)	3/20/2004 12:01:12 PM
From: Steve Lokness	Read Replies (2) \| Respond to of 110194

Elizabeth: <<This is a fundamental change in the market that will persist for a long time.>> But there is huge demand from the housing sector! Not only does housing remain astonishingly strong, but the size of the houses continues to increase. Why do parents with children gone need a 5 thousand foot home? These houses are not homes they are trophies. In recessions in the past it was often housing which pulled us out as interest rates declined. This time interest rates remained low and consequently housing strong all through the recession. If housing crashes and this then pulls the plug from those spending their home equity on WalMart crap and SUV's - what happens to our economy AND what happens to the demand for commodities? steve

To: Elizabeth Andrews who wrote (10528)	3/20/2004 5:53:13 PM
From: Raymond Duray	Read Replies (2) \| Respond to of 110194

Re: This, in my view, is not a normal base metal cycle, Correct, this is the first post-industrial metal cycle in the U.S. TTBOMK, there is only one plant in America still producing steel from iron ore. The balance are mini-mills and hybrids. With the Chinese bidding the price of scrap steel to a very high price, there is a huge and long-term bind on the mini-mills. In a post I read earlier, one developer of light commercial buildings just stated that his builder was quoting "miscellaneous iron" at a 500% premium over the price one year ago! This is astonishing to me. Whatever is happening in the steel industry today isn't even remotely close to normal. Re: This is a fundamental change in the market that will persist for a long time. So, how long is permanent?