jepittman

Expert Commodity Picks for 2009: Jim Rogers and Marc Faber

In my opinion getting into bed financially with the Russians can be hazardous to one's financial virginity. If you want exposure to Russia do it through a diversified emerging markets fund (such as EEM, an emerging markets ETF).

I admire your courage to invest during these fearful times. I believe you will do well. Stay diversified and stay with quality and you should be up nicely in a year. More in two years, IMO.

Good luck.


On Jan 05 12:45 AM Coal Monster wrote:

> I think commodity stocks are stupid cheap right now, so cheap I canceled
> my cd and invested all my money into the market and so far have bought
> Peabody Energy(BTU), Consol Energy(CNX), US Steel(X), and Dryships(DRYS).
>
>
> I'm confident that coal will pay off in the long-run, especially
> with the China demand, however, I know it would be wise to add natural
> gas to my portfolio, and I'm waiting on the sidelines to buy Chesapeake
> Energy at a lower price(I'm hoping the DOW will go below 8500 in
> the next two weeks).
>
> However, I am considering investing in the Russian natural gas company--Gazprom(OGZPY...
> which is a monopoly, but I'm not sure if investing in something the
> Russian Gov't partly owns would be a good idea...what do you guys
> think?

Expert Commodity Picks for 2009: Jim Rogers and Marc Faber

Good farmers with good credit should have no trouble getting crop loans. There is a lot of very bad information out there concerning credit availability.

Incidently I find it amusing that Rogers and Faber pound the 'inflation is coming back' issue because of money creation but can't bring themselves to say the US stock market will benefit from such an occurance. There is no way all the dollars being created do not find their way into US financial assets. It won't just happen with commodities.

OPEC Targets Higher Oil Prices: Who Wins and Who Loses

OPEC has a very spotty track record sticking to lower production quotas. The temptation to pump a few extra barrels is ever present. Also, the global economy is still several months away from a meaningful recovery.

The American consumer has largely made the shift to higher milage cars and has learned how to eliminate frivolus driving. Any hike in gas prices will be met with the newly learned reponses of reduced driving and a continuing shift to hybrid cars.

While it is entirely possible we could see $75 a barrel oil again as the global economy inevitably recovers, a near term return to $100+ is a longshot at best.

10 Predictions for the Global Economy

I can agree with with your points. However there is nothing here the market has not already seen and in my view largely discounted. If this had been written a year ago it would be far more valuable.

Focusing on Commodity ETFs: Hyperinflation Seems Inevitable

Hyperinflation is no more inevitable than deflation. Both are conditions determined by the supply of money which is controlled by the Federal Reserve. There have always been cycles of inflation an deflation but prolonged destructive hyperinflation or deflation are caused by protracted errors in monetary policy. Many believe such is happening now but the evidence is that the Fed is increasing the money supply to offset declining prices. As prices stabilize and begin to rise again the Fed should act to reduce the money supply. The hyperinflation you seem to forsee depends on a negligent monetary policy. That is not inevitable although it could happen.

Stay Away from Commodities at the Beginning of Economic Downturns

Unemployment is a lagging ecomic indicator. Unemployment has been trending up for a year and has recently risen at an increasing rate. If you look at the 2001-2003 chart most commodities bottomed near the midpoint of the recession and had sharp price rises well before the recession ended. The action is similar in the other recessions. As the author suggests it may still be early but history tells us an upward move will begin well before the economy bottoms and the moves are often violent. Our current unemployment rate is 6.4%. The consensus estimates I have seen for the peak run from 7.5% to 10%. If you are in the 10% camp it is early. If you are in the under 8% camp it is getting close.


On Nov 07 01:52 PM paultaut wrote:

> the question then appears to be whether we are at the beginning or
> towards the end of the Recession.
>
> I submit that it is closer to the beginning since most of the current
> malaise has been Financially driven not consumer driven. The employment
> rate is only in the second month of the normal type of contraction
> seen.
>
> I would hazard a guess that a monthly decline or two above 400,000
> will be seen before the late stage can possibly be envisioned. <br/>
>
> Besides, who has heralded that the US is officially in a recession,
> YET?