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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (36020)	8/26/2005 4:13:50 PM
From: Perspective	Read Replies (4) \| Respond to of 116555

I disagree. Bubbles collapse all on their own. Tighter credit wasn't the primary motive force that burst the 2000 stock bubble; it collapsed under its own weight after consuming all available fuel to drive prices to unsustainable levels. Housing may have exhausted its fuel: lower interest rates, increasing homeownership, and novel mortgage finance schemes. BC

To: Knighty Tin who wrote (36020)	8/26/2005 6:02:55 PM
From: mishedlo	Respond to of 116555

Hi, this is Tim Hannagan and it is August 26th and the markets are closed- C O R N Monday’s crop condition report showed a 1% decline in our G-E category after the heavy week prior rains were expected to show an improvement. This effectively means the growing season is over. Thursday’s weekly export sales confirmed demand remains slow coming in at 318 m.t. sold last week 32% under the week prior and 47% below our four week average, even though were 20 cents cheaper on the month. Corn settled the week off about 6 cents as crop tours taking place surprised the industry by coming in with much higher corn and bean yield projections than the trade had expected. How was that after the sixth driest summer on record. Simply, the crop tours started in the west in Nebraska and east in Ohio and traveled I-80 to meet in Illinois. Well, I-80 traveled through northern Illinois, Indiana and Ohio. Through the middle of Iowa and Nebraska the best rains of the year were in those areas. It is central and southern Illinois and Indiana and all of Missouri. That got hit hardest from drought, also Wisconsin. This is why crop tours do not work. To visit each county through every county road would take months. It will take until the September 12th crop report to get a better feel for crop size and maybe even the October report when we are deep into the fields as harvest progresses. Funds are heavily short and should look to take some short profits ahead of month end next Wednesday. December has major support at 2.15 and resistance 2.27. B E A N Monday’s crop condition report came in up 1% in the G-E category disappointing prior trade estimates of 3 or 4% due to ample prior rains. Like corn, it suggests the growing season is ending. Thursday’s weekly export sales report showed 101 m.t. were sold last week off from 150 the week prior but 46% over our four week average with China in for the first time in a month. It is a slightly friendly demand note. After a nice short covering rally Monday and Tuesday beans like corn fell as crop tour results came in as a bearish surprise to the trade. Beans are down about 85 cents on the month, so funds are fat with profits and with month end next Wednesday watch out we could see short covering similar to what we saw this last Monday and Tuesday. Support is 5.94 on November with 5.78 as worst case scenario. Resistance is 6.26. W H E A T Monday’s crop progress report showed 59% of our spring wheat is now harvested with the winter crop in the bin leaving demand fundamentals as our primary pricing force. Thursday’s weekly export sales report showed 853 m.t. of wheat was sold last week up 82% from the week prior and 38% over our weak four week average. With wheat down over 20 cents on the month and 85% of our total U.S. production in, we expect demand to begin, but do not think one good week of sales does it. We are still a second or third port of origin for quality milling wheat in the world due to poor growing conditions and yearly low condition ratings while competitors continue to produce high quality tonnage with funds holding a near record short position, we might look for profit taking ahead of month end Wednesday. Support on December wheat is 3.20 and resistance 3.33.