Gigem77

Short-Term Correction in the Commodities Bull Market

First you say, "... smart investors should take advantage of currently depressed prices to aggressively accumulate shares in select precious metals and energy companies."
Then you add, "The next few months might continue to be painful for commodities." So which is it? If commodity prices are to remain "painful" for months, then why buy now?

And at the end we see that you have no disclosures, apparently not long any of the things you advise others to aggressively buy. That speaks volumes about your confidence in your own analysis.

De-leveraging, redemptions and writeoffs are not done. Unless and until some big buyers come back to the commodity sector, prices will remain moribund. Who might these big buyers be?

Inflation has two components, money supply and the velocity of that money. You correctly note the increase in supply but completely neglect the velocity. Wages can't grow as unemployment rises and productivity falters. Americans are being forced to clean up their individual balance sheets, paying off or defaulting on debt and and reducing spending. Retail investors aren't going to be the buyers.

Which Inflation Is It Anyway?

The money supply is expanding. M2 hit a new record in the latest reporting period. So where are you getting your information?

www.prudentbear.com/in...

M2 (narrow) “money” supply surged $48.7bn to a record $7.747 TN (week of 7/21). Narrow “money” has expanded $284bn y-t-d, or 6.8% annualized, with a y-o-y rise of $468bn, or 6.4%. For the week, Currency increased $2.4bn, and Demand & Checkable Deposits jumped $16.1bn. Savings Deposits rose $11.8bn, and Small Denominated Deposits added $3.2bn. Retail Money Funds jumped $15.2bn.