sorgmot

Commodity Outlook Breeds Skepticism - Except, Of Course, For Gold

Hypothesis: 2009 is 1939 all over again. The future near term is the 1940's sans World War III.

In the early 1930's, the DJIA took a very large down leg to 1933 which was followed by progressively higher up legs to 2000.

In the early 2000's, the DJIA took medium down leg while the NASD tool a very large down leg from 5000 to 1000.

Conclusion: The DJIA is full of government protected monopoles and Cartel members while the NASD is full fo companies that face real competitions and real market forces.

Some interesting sidelights:

1. Gold took off like a shot in 2000 and rose 3 times in value to 2008.

2, The long downward trends in USA bond interest rates that started in 1980 ended in 2002.

3. The US $ began falling against other currencies in the 2000 to 2008 years.

4. The USA money supply and total debt outstanding exploded upward from 2000 to 2008 accompanied by an unbelievable growth of the debt to equity ratio.

5. USA and international real estate and stock and non government debt markets around the world fell in amounts up to 60% in 2008.

6. Due to heavy debt loads on assets built up over the years from 1980 through 2007 aggregate equity of persons and companies went negative in 2008.

7. Everyone wants to thank the USA federal reserve for the loss of all net equity on planet earth weil in advance of 12/21/2015 as forecast by Nostradomus and mid American astronomers even before him.

Our bets are made in consequence of these facts which will impact the coming time domain.

Good luck.

Jim Rogers Still Bullish on Commodities, Bearish on the Fed

The US$ is cascading downward against the Yen and should reach 50 Yen in 2012. The US$ is ending its uptick against the Euro and should hit should hit one half Euro in 2012.

There will be endless declines in the US$ against those two currencies as long as the USA governments take over all economic business decision making in the USA.

Guess who; just won World War II?

Good Luck.

Gold's Relative Appeal

The league of lawyers has retaken the USA Governments at all levels. Lawyers are not known for their management ability. They are known for raising costs and diverting profits to them selves. That is what regulation is all about.

The Fidelity Select Funds and the Fidelity foreign market funds are all down 50% to 75% from their 2007 peaks. What does they tell us? All savers and investors are ruined and they have also lost any hope of future success with their investments and they can not pay their bills as they come due. The investors must keep on selling assets and declare bankruptcy.

The lawyers will explode the money supply, explode the government payroll, dnd explode the number of regulations to keep more lawyers busy and rich.

Of course, these actions will drive the vast majority of citizens into poverty.

Non USA countries made big mistakes by holding leveraged US $ denominated investments. In the future, they will stay clear of these and sell US $ investments and dollars too.

Does this screen play hold water? If so, what would be a logical investment program for the next decade?

Good luck.




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Second Worst Month For Commodities Ever

Douglas Adams, Hitchhikers Guide to the Galaxy say the answer is 42.

The long credit cycle would be at about 1938 now.

The big difference is that the British pound was then under pressure as is the USA dollar now. The pound settled to one fifth of its former value against the US dollar (that is pound at one US dollar)and has only recovered to 2 US dollars since the US doller has strarted to fall against foreign currencies and gold.

All that doesn't give a precise US dollar to gold ratio so why not go for 42 times 32 or 1250 per ounze.

And look for the dollar to keep on declining against gold and the currencies of countries that are not borrowing credit from abroad using their own currencies.

Bespoke's Commodity Snapshot (6/10/08)

Thanks for the charts. They are very useful in predicting mining company profits, all else being equal. The gold chart shows that that metal was being sold for $ 650 per oz. in the summer of 2007 and is now selling for $ 900 per oz. $ 250 per oz. more to the bottom line.

The Barrick president says the cost is $400 per oz. so profits should double in 2008 versus 2007. Perhaps, the stock value will double too.

See your investment adviser and always diversify your portfolio. This is not a recommendation to buy or sell any stock shares.

Bill Gross: Understated Inflation Means Commodities, Emerging Markets Should Outperform

"By the rude bridge that arched the flood, here the embattled farmer stood and fired the shot heard round the world."

Concord, Mass. USA 1776.

Many men with many rifles ended royal governments around the world and replaced them with massively costly and totally overbearing elected governments throughout the 18 and 19 hundreds.

The consequences are upon mankind as the 21st century begins.
The costs of running governments which do nothing but miss allocate resources for wars and roads and space shots and money printing and and set up a multitude of regulations and set up cartels and etc are now reducing real per capita wealth even as most countries chop their populations by one method or another. One child laws in China, abortion in the USA for examples.

The USA, led by lawyers who now control the three branches of its governments from town to federal level and who enrich themselves by taking money from the corporations they ease into monopoly power positions with permit power and other means.

Hey, but the good news is that bad governments always crash and burn while the poor inherit the earth and plod on. The western Roman empire crashed and never rose again while a new religion arose. The eastern Roman empire crashed and a new religion arose. The British empire crashed in World War I. The Russian and Germain governments spent the 1900's crashing and burning over and over.

The individual is alway self educated and will learn what works. Thanks to Bill Gross and others who let the real situation be known.

Where's the Bursting Commodities Bubble?

To see more charts and charts with longer histories, click on our site and then click on commodities, and then click on Moore. Most commodities have exploded upward in US dollar terms starting in 2003.

We believe that commodities are in limited supple due to mining limits and world-wide mining cartels. Also, mining costs are up due to fuel and other costs. Since copper has gone up 100 times in US dollars from its 4 cents per pound low in 1932, other commodities can do the same. That would put the CRB higher than it is now.