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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: carranza2 who wrote (20807)	8/5/2007 2:01:52 PM
From: abuelita	Read Replies (1) \| Respond to of 217616

thanks for your reply.

To: carranza2 who wrote (20807)	8/6/2007 12:23:05 AM
From: elmatador	Respond to of 217616

asset class that has so far remained immune to the turmoil caused by fears of a US credit market meltdown – commodities four-year rally in commodity prices is a consequence of the global liquidity glut looks misplaced. The fact that commodities have continued to rally suggests supply and demand, rather than liquidity, have been the key driver.” ELMAT: In short: decoupling. Hangover are for the ones who partied in carry trade. View of the day: Commodities Adam Cole, RBC Capital Markets Published: August 2 2007 17:40 \| Last updated: August 2 2007 17:40 There is one asset class that has so far remained immune to the turmoil caused by fears of a US credit market meltdown – commodities, says Adam Cole, senior currency strategist at RBC Capital Markets. He says that since mid-July, equity, foreign exchange and fixed-income markets have been driven wholly by the ebb and flow of market appetite for risk. By contrast, “commodity price movements have remained both uncorrelated with bonds, equities and FX and in many cases have pushed to cyclical highs”. Mr Cole suggests there are two potentially key implications of the ongoing independence of commodity price movements. First, the widespread perception that a large part of the four-year rally in commodity prices is a consequence of the global liquidity glut looks misplaced. “It is precisely because of concerns over receding liquidity that equities have fallen, credit spreads widened and the FX carry trade unwound. The fact that commodities have continued to rally suggests supply and demand, rather than liquidity, have been the key driver.” Second, he says, the global economy may be less vulnerable than traditional barometers such as falling equities and widening credit spreads suggest. “If current worries on financial market liquidity really extended to real economic variables, commodities should already be falling with other cyclical asset classes.”