silver-bullet

Commodities: Bubble or Not?

BTW for all who wants to bet against Soros and Buffett, you should have very VERY LARGE short positions on oil, commodities, precious metals and agriculture. And large long positions on financials and the US dollar.

Commodities: Bubble or Not?

e2800 - Forget what others says, since you are an econ major let's talk about supply and demand.

A bubble is defined as an inordinate increase in price of an item where there is EXCESS supply.

With that in mind, please point us to newer and larger oil wells, please show me where the extra grains and wheat and commodities are? We simply do not have enough supply (we as in the world) of any of these commodities. The manufacturing facilities oil rigs and mines are decades old, and few, if not none, are built in the recent past. These facilities take years to be in full production. So, please, know your facts and not let your emotions run wild.

I'll tell you what a bubble is:
- The US dollar
- Financial stocks and bonds
- Housing
- World consumption - Lead by USA

I dare say gas will be at $8/gal in 2009. When that happens, all commodities will shot way, way up.

If things get bad (gas line, riots etc.) we may all see world war III - that will be the inclination of our political leaders. This will make going into Iraq seem like a walk in the park.

Do not forget: China, India, Russia, USA all have nuclear capabilities. It WILL be a fight for survival.

There is no bubble