POSCO's Hiccup in the Global Growth Story
New evidence is starting to emerge that China is stalling for the near-term, but I see decoupling as ultimately inevitable, and continue to believe that China and other economies that were in a position of strength before the crisis unfolded will lead the way out of the crisis. When paper fails, hard assets are the place to be. I'm not saying steel and aluminum are necessarily the best places to be within the hard assets space, but as belwhethers they are crucial barometers of economic strength or weakness. I see near-term declines in prices for iron ore and coking coal when they are re-negotiated next year, and some continued weakness in copper prices, steel, and aluminum.... which is why I advocate a focus on precious metals for the time being. One can always shift pm gains back to base metals and related finished products once the China growth engine starts rumbling again.