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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (31569)	5/19/2005 1:49:58 PM
From: Valuepro	Respond to of 306849

mishedlo, "What commodities boom? There was a boom in oil and metals. Grains and other stuff are near historic lows and coffee etc is just going up and down." Right. I was too broad with that when I meant raw materials and energy. "Now your assumption is that the commodities boom will contine. Will it?" I very strongly believe so, at least in regards to raw materials and energy. Many writes are starting to call this time the beginnings of the raw materials Super Cycle. A super cycle, as opposed to a mere recovery/bull run, is one which can last decades. "Perhaps oil continues but if Housing heads into a slump demand for copper and metals etc will drop." Not by too much, and only in the U.S.. China is now the world's largest consumer of copper, cement, steel and other building materials and moving up the ladder in regards to other resources as well - 2nd largest consumer of oil now. "and if China slows significantly as well there might be some real surprises in store for commodity bulls." Yeah, so true. But, China and India today are where the U.S. was, economically speaking, soon after the dawn of the Industrial Revolution. They are well on their way to becoming the world's centers of economic power, and here is the danger for us: There are not enough raw materials on the planet to sustain growth in China (forget India for the moment) without severe repercussions to the rest of us. The U.S. is a paper economy these days with no hope for a health change. We have a service based economy running on debt and living with an historically proven unsustainable trade deficit (as held against GDP). We are making less and less of our own goods and becoming increasing dependent on those overseas producers who make what we need. The world is exporting it's manufacturing to China (and India). No significant slow down is on the horizon. Here are a few selections from recent news about China's economy. quote.bloomberg.com bloomberg.com biz.yahoo.com english.peopledaily.com.cn english.peopledaily.com.cn