Wheat, sugar, coffee, cocoa, corn, gold, silver - whatever speculators can get their hands on with fiat money (ex natural gas which is in a personal nightmare), it's time to bid it up to the moon.
Cotton hit an all time high Thursday, even higher than the speculative fever reached in summer 2008 in all things commodities (before they crashed), before a frantic retreat Friday as Bernanke creates a Wild Wild West atmosphere in all soft and hard commodities. Thankfully, as long as you don't eat, use energy or (now) clothe yourself you should see no ill effects. As long as we all live like Ghandi we should be safe from the loss of purchasing power (that are only happening in our imagination - per government).
Much like in late 2007 to early 2008, we will soon have to worry about the impact of input costs to our dear corporations. The lag effect is generally 2-4 quarters so about this time next year, the 'success' of Bernanke should be crimping profit margins for commodity users. On the plus side, they can just cut more jobs to offset those rising costs and maintain profit margins... aka "success" at the Fed. (Click to enlarge)
Via AP: (my comments in parenthesis)
- Cotton for December delivery fell 5 cents to settle at $1.0987 a pound after hitting a record $1.1980 a pound.
- It was the highest level for cotton since cash prices paid to farmers during the Civil War when blockades prevented shipments from leaving the South, said Sharon Johnson, a senior cotton analyst at Penson/FCG. "As long as I've been involved in this I've never seen anything like this," said Johnson, who has worked in the cotton market since the mid-1980s. (one positive about this era of central bankers gone mad the past few decades is we get to see history made all the time)
- In the past three months, cotton has rallied from a low of 73.01 cents a pound after adverse weather in Pakistan, India and China delayed or reduced the size of crops there. Traders also have taken advantage of the dollar, which has grown weaker recently against other currencies. Since commodities like cotton and oil are priced in dollars, traders can buy more product by using foreign currencies.