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Commodity Bubble Pops! The Next Bubble! Two Best Market Accessments to Read & Onion Humor!

Recs

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August 16, 2008 – Comments (6) | RELATED TICKERS: SKF , SRS , DUG

"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)

20 Recs 20 May 27, 2008 – Comments (27) | RELATED TICKERS: GLD , OIH , SLV

"The Goldman Sachs Commodity Index plunged a record -20.9% over the past 35 days as of Monday.  "

Comstock Partners, Inc. Stay The Course August 14, 08 

It is important to make a current accessment and re-evaluate your over all investment plan.  Many fools were hoping to ride the Commodity bubble, the real estate bubble or "BRIC story", but the circumstances have changed. The last bubble has been taken out, it will not reinflate unless there is a greater war.   

But lets take a look at one of my favorite historical examples here for the need to identify the change in circumstance in a timely manner here:

http://www.youtube.com/watch?v=nY0ClsW1QX4

http://www.youtube.com/v/nY0ClsW1QX4&hl=en&fs=1"> name="allowFullScreen" value="true">http://www.youtube.com/v/nY0ClsW1QX4&hl=en&fs=1" type="application/x-shockwave-flash" allowfullscreen="true" width="425" height="344">

The attack on the DeathStar did not go as planned. The rebels had followed a similiar attack plan, that had been previously attempted and proved to be a "sucess" (ref Star Wars).  This time the rebels borought in their entire fleet for the attack. However, the fully operationial DeathStar's shield had not been taken, down and the rebel fleet walked into a trap. Like Fools piling on to the BRIC story, Commodity Bubble etc, "buy and hold" etc.... following a previously successful investment plan requires vigallence and flexibility to changing circumstances at hand.

When Goldman Sach made the call for "$200 a Barrel oil" all Fools should have heard "break off the attack, all craft pull up!...it's a trap!". GS does not provide free advice, it is not a charity. GS' employees are the highest paid people on the planet, possibly in the history of the world?. The average GS' BONUS in 2006 was $300k? (sorry I could not give a reference)

The financial markets are a carnivorous game, when one of the biggest sharks tells the little fish for "free advice" you should proceed with caution, as for me, I think "IT'S A TRAP!"

"The commodity bubble has popped. The investors who love to chase bubbles are out of luck. The last bubble has popped. It is unlikely to recover until the recession is over. If we avoid war, the commodity sector will deflate. There are no more bubbles. Gary North, 14 Aug 08

I think we have an alternative energy and building infustructor bubble at some point. The government needs to redistribute wealth to those that write the checks for re-election. This bubble is being built, promoted and sold now. First solar, wind farms etc.. T Boone Pickens nonstop rambling about wind farms and energy independence  and others are being promoted heavily by the corperate media. "We have to be energy independent!"

Okay! How about stop selling SUVs and allow electric cars and create decent public transpertation first! CHEERS!

I think it will get a lot stupider at some point. Like Jimmy Carter putting solar panels on the White House (Ronald Regan took them down), all that stuff/BS promotion is coming. Anything to provide "panem et circenses" for the masses and wealth transfer to the classes. 

Here is itulip discussing the next bubble (thanks to lquadland10 for the find):

http://www.youtube.com/v/kqOOnbMMemE&hl=en&fs=1"> name="allowFullScreen" value="true">http://www.youtube.com/v/kqOOnbMMemE&hl=en&fs=1" type="application/x-shockwave-flash" allowfullscreen="true" width="425" height="344">

FYI - (Onion Humor) Recession-Plagued Nation Demands New Bubble To Invest In

WASHINGTON—"Every American family deserves a false sense of security," said one analyst, hoping to persuade Congress to back an unviable short-term solution.July 14, 2008 | Issue 44•29 News 

My call is cover your commodity longs unless you are anticipating a greater war.  Many people think there will be a greater war. I cannot imagine these moron NEOCONs want to push the envelope of American tollerance of an even greater war with Iran. But we did fight in Vietnam for 3-4 years for pure stupidity, with no real national interests at stake. Wars start and continue over pure and total stupidity though out history.  Place your bets accordingly, "demand destruction" or "greater war".

NOTE:  General Wesley Clark (Retired) memoir

'Oh, it's worse than that,' he said, holding up a memo on his desk. 'Here's the paper from the Office of the Secretary of Defense [then Donald Rumsfeld] outlining the strategy. We're going to take out seven countries in five years.' And he named them, starting with Iraq and Syria and ending with Iran."

 FYI- Onion Humor:

Violence Must Only Be Used To Make Hundreds Of Millions Of DollarsBy Jackie Chan
August 13, 2008 | Issue 44•33

Two Reports that are worth your time: 

1. By Comstock Partners, Inc: Stay The Course 14 Aug 08

(hat tip to Gary North for providing this great report)

2. By Seeking Alpha: The Great Consumer Crash of 2009
(Hat tip to dwot for finding this great report)

3. You should understand the Georgia/Russia situation. Here is a decent write up:

Blowback From Bear-Baiting

by Patrick J. Buchanan (08/15/08) "Saakashvili's decision to use the Olympic Games to cover Georgia's invasion of its breakaway" province must rank in stupidity with Nasser's decision to close the Straits of Tiran to Israeli ships.

6 Comments – Post Your Own

#1) On August 16, 2008 at 10:24 PM, abitare (36.90) wrote:

Here is the link to itulips and the next asset bubble here:

http://www.youtube.com/v/kqOOnbMMemE&hl=en&fs=1

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#2) On August 16, 2008 at 11:00 PM, abitare (36.90) wrote:

FYI  - Mish Shedlock 16 Aug:Gold, Silver and the Great Unwind

What's happening with gold should be no real surprise. Although I have stated many times that gold is money and gold should do well in deflation, and we are in deflation (see The Future Is Frugality and Implications of the Slowing Global Eonomy for the deflation case), in the initial stages of deflation, leverage in everything is reduced by force.

There are thousands of hedge funds, pension plans, and individuals over-leveraged in a massive bet against the US dollar and US assets in general. Many themes of the past 7 years are now being unwound. And one would expect leverage to be forced out in deflation as credit simply dries up. I call this the great unwind.

The Great Unwind

Short US Dollar - Long Commodities Short US Dollar - Long Foreign Equities Short Financials - Long Gold Short US Equities - Long Foreign Equities

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#3) On August 17, 2008 at 12:05 AM, dwot (66.58) wrote:

When the heck you change your name?

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#4) On August 17, 2008 at 5:44 AM, wrote:

Ares--

This is an excellent post, and your links were very helpful to me in increasing my understanding in this little gambling game called Wall Street.  Thank you very much.  I learn a lot reading everyone of your posts.

The only question I have for you is this.  Isn't it possible that IF Obama win the election the commodity bubble may not completely pop?  This isn't the dot com bust.  Commodities did and still are making a lot of money.  IF, a big IF, the government under Obama decides to move towards a temporary increased reliance on ethanol to reduce our dependance on petro (oil); couldn't both sub industries such as  agriculture and oil win? Couldn't alternative energy also win?  In turn couldn't commodities also win?

I feel better owning a companies stock such as Google and Potash; instead of Citibank because the other two companies are making money and citibank is throwing it away.  I've been burned; I may go down in flames, But no one wins if the financial center bankrupts America besides the people that caused this mess in the begining.  That will not sit well at all with the American population.  Heads will roll.

andrew

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#5) On August 17, 2008 at 11:49 AM, lquadland10 (< 20) wrote:

Just one small question, if the dollar does tank and the banks fail then will gs be right with $200.00 barrel oil? To me it seems that GS is the company that is running the country. Could this be the way they are doing it to establish the North American Union with the Amero as the currency? I just watch who is running the Treasury right now and Paulson is from GS the new guy they brought in is from GS Cramer is from GS and if you follow the money it leads to GS. Then follow the money from GS to the next higher up. To what country. If WW III breaks out who will benefit? Industrial Military complex and GS and Banks.  What is the real truth? Will we ever know.

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#6) On August 18, 2008 at 11:41 AM, abitare (36.90) wrote:

If your goal were to make money, you would put all of your money in your career. You would bet the farm on your specialized endeavors in which you have better information than 80% of the other people in your market, who in turn have better information than 80% of investors generally. If you want to make money, if you want to get rich, if you want to look back on your life and say "I made a bundle," you must invest all of your time, and all of your money, and all of your hopes, and all of your energies in your career.

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