Urbane Gorilla!

Wake Up Copper Consuming Dragon

I highly doubt we'll have a rate cut. Bernanke and Paulson need to save those last two points for when and if we have another major downturn. Look what happened to Japan. They've had an effective zero-percent rate for awhile.. It did them no good. There is chatter about it and the number of people expecting a rate drop has gone from 4% to 12% (I heard that on CNBC...) I suspect that BandP will milk the financial problems as long as possible and apply bandaids on the bleeding. This seems to mollify the public as we have a very short memory 'and' we really would like to see a turnaround. Sooner or later the economy will correct. And any rate cuts they apply will have to be painfully stripped back later. However, no-one really knows.

The hint of a rate cut is not moving anything.

What we have had for awhile is a rotating market. Imagine watching the 'Discovery Channel." You have an alligator with 'Financials written on its stomach and 'Commodities' on its back. It has a grip on the careless gnu (the market) and is performing its death-roll. So every few days the market changes from commodities to financials as it shreds everyone's portfolio to pieces.

And if you've lost money on PCU and FCX, then you are in very good company. Look at the chart for CGMFX, run by Ken Heebner... He has beat the market by a mile over the last few years.. I think one year this fund returned 80%. And anyone that bought into the 'go long commodities and short the financials' has suffered as well.

One other thing to know is that China has stockpiled a lot of materials, and copper is one of them. Google 'seekingalpha +copper _China' and you'll pull up some interesting stuff. Eventually, China will begin buying again. I just picked up some SSW (Seaspan) a container company. I listened to an interview of the CEO.. He said that since July, containers have been picking up. To me, that and the Baltic Dry Index are indicative of a beginning of a turnaround. I depend a lot on charts... And even if you are a fundamentalist, (or a beginner) I'd learn some basic stuff, such as can be found on Investopedia.com.

By the way, it isn't as sexy, but it's probably time to buy consumer non-discretionaries like P&G, Campbells, Hershys, McDonalds and etc.. Again, Look at the chart and you'll see what I mean. I've just sold FRED (Fred Meyers) after a 5% run and it is pulling back a bit. when the daily stochastic moves past 20%, I'll buy it back again... Nice chart.. Moves straight from the lower left to the upper right ....

Have fun! jegan ;-)