Commodity Bubble Goes Pop! Gary North says "I have just read the most fearful speech I have ever read...by Gov Official"
"Like Vader I sense danger in the commodity bubble. I have closed most of my commodity longs. So it will go for the First Commodity Bears, who attacks the Commodity Bull. The first ones in will be killed (ref my MOS, MON, POT calls). The guy, who times it right here in CAPS will be a hero and Top Fool, the way the previous Top Fool arrived by underperforming all the homebuilders and residential real estate.
The commodity bubble might have more up side, but long commodities and short the US dollar is one of the most crowded trade in the world today.
But eventually the commodity bubble will be popped. The commodity bubble is the last bubble left by the reckless Central Banks monetary inflation and government overspending. When the commodity bubble pops, like the DeathStar explosion, you had better be clear."
abitarecatania (ref: The Upcoming Top Fool Will Be a Commodity BEAR)
Recs 20 May 27, 2008 – Comments (27) | RELATED TICKERS: GLD , OIH , SLV
ORTaking the Pulse of the CAPS Blogs: Commodities
By Christopher Barker May 29 May 08
Recession = reduced demand = reduced production = reduced consumption = reduction price of commodities
CRB Commodity Index Caps Biggest One-Day Decline Since March
By Millie Munshi
"Aug. 4 (Bloomberg) -- Plunging prices for cocoa, natural gas and sugar sent the Reuters/Jefferies CRB Index of 19 commodities to its biggest one-day decline since March.
The CRB index fell 3.4 percent to 401.98, which marks the largest slide since March 19. The gauge dropped to the lowest level since May 2 today, as did the UBS-Bloomberg Constant Maturity Commodity Index.
The CRB slid 10 percent in July, the most in any month since March 1980, when the U.S. economy was in a recession. A worsening global growth outlook and prospects for increased supply sent raw materials such as crude oil, soybeans and gasoline tumbling from records in the past month. "
I pay for Gary North. He posts four times a day. He has wisdom gained from time and experience, that I lack. He also does not sell anything but advice, which keeps his posts clean of an agenda. He was one of the few to point out the commodity bubble last year. Since I read/follow Peter Schiff and Marc Faber, this is NOT the "most fearful speech" I have read. Watch Dollar Collapse on youtube.com, if you want scary.
"THE MOST FEARFUL SPEECH I HAVE EVER READ"
"I have just read the most fearful speech I have ever read that was delivered by a high-level American official, who is in a position to know what he is talking about. No other speech comes close. I have been reading speecI have just read the most fearful speech I have ever read that was delivered by a high-level American officialhes for a living for over 40 years." Gary North 08 Aug 08.
Storms on the Horizon
Richard W. Fisher, of Dallas FED
Storms on the Horizon
Remarks before the Commonwealth Club of California
San Francisco, California
May 28, 2008
Couple of good quotes:
"We know from centuries of evidence in countless economies, from ancient Rome to today’s Zimbabwe, that running the printing press to pay off today’s bills leads to much worse problems later on. The inflation that results from the flood of money into the economy turns out to be far worse than the fiscal pain those countries hoped to avoid.
Earlier I mentioned the Fed’s dual mandate to manage growth and inflation. In the long run, growth cannot be sustained if markets are undermined by inflation. Stable prices go hand in hand with achieving sustainable economic growth. I have said many, many times that inflation is a sinister beast that, if uncaged, devours savings, erodes consumers’ purchasing power, decimates returns on capital, undermines the reliability of financial accounting, distracts the attention of corporate management, undercuts employment growth and real wages, and debases the currency.
Purging rampant inflation and a debased currency requires administering a harsh medicine. We have been there, and we know the cure that was wrought by the FOMC under Paul Volcker. Even the perception that the Fed is pursuing a cheap-money strategy to accommodate fiscal burdens, should it take root, is a paramount risk to the long-term welfare of the U.S. economy. The Federal Reserve will never let this happen. It is not an option. Ever. Period."
Read the rest here: