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

To: TheSlowLane who wrote (12189)	4/19/2004 2:09:21 PM
From: rubed	Respond to of 110194

I think what Faber was trying to say, but did not say very well, is that food commodities have a shorter cycle - you can increase supply very quickly in response to high prices. You can switch corn for soybeans in the next crop. It's a whole different story with metals obviously as it takes a long time to find deposits and develop them. And with oil, its getting a whole lot tougher to find it and you have incremental demand growth in China and India that is only increasing. rube

To: TheSlowLane who wrote (12189)	4/19/2004 2:45:44 PM
From: russwinter	Respond to of 110194

<highly unlikely that "massive additional supplies" will be produced anytime.> Absolutely correct, decent supply analysis seems to be in as short supply as metals themselves. Any bust in commodities will have to come (and quickly, not later) from the demand side of the equation. In Cu I figure the deficit is 5-12%, and that will have to disappear to get the market back into equilibrium. The ability to rely on remaining above ground stocks and inventories is in it's last hurrah. Any guesses as to when the "copper crisis" becomes headline financial news? May 19th, June 2nd, June 28th?