Freeport-McMoRan Copper & Gold, Inc. (NYSE:FCX)

CAPS Rating: 4 out of 5

Through its subsidiaries, the Company engages in the exploration, mining, and production of copper, gold, and silver. It also smelts and refines copper concentrates, and markets the refined copper products.


Player Avatar XMFSinchiruna (27.59) Submitted: 1/14/2008 10:16:14 PM : Outperform Start Price: $35.50 FCX Score: -57.51

As I've said elsewhere, I think that the prevailing assumption that prices for industrial metals like copper will soften in 2008 because of this recession are unfounded. First of all, it's not a recession... we're on the verge of an unprecedented DEPRESSION! All the ingredients are in place for completely rampant hyperinflation, and gold will respond in price accordingly. Gold will pass $1,000 before we know it, and after several unconvincing consolidations, it will resume its rise to $1,650 and beyond! Copper has come off its highs because analysts predict softening US industrial demand will lead the price lower. I do not subscribe to this. As the dollar plummets, the value of copper as denominated in dollars will rise just as gold will. Demand from the BRIC countries will be sufficient to keep the global copper shortage intact. Now FCX is not my favorite pick in this sector by any means. They have a host of labor problems because they underpay their workers in Indonesia, and their environmental record is attrocious. They have also had quite a run already, so I expect more junior and mid-tier producers to outperform the FCXs of the world through 2008 and beyond. BUT... FCX will still outperform any of the major US indeces for several years to come.

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