You Ain’t Seen Nothin’ Yet
PAIN
UPDATE: Back in 2007, there were food shortages and gas lines, all thanks to “global growth,” embodied with all of its joys and splendor— throwing the working man (you) into idle sewer pipes and cavernous manholes. Now, we have a different scenario.
Post unwind, central banks have flooded the system with “banana money,” as in “Banana Republic” style fiscal policy, not to be confused with the egregiously overpriced retailer. If you see the highs of 2007—just north of 450— on the chart featured above (CRB Index), consider the following:
- “Global growth” can regain 2007 levels, with no problem.
- Due to the crash of commodity prices, during most of ‘08, capacity is not nearly what it was in ‘07. In other words, mines were shut down and rigs were stacked. In order to get capacity utilization back to the 2007 highs, it will take some time. No one thought we’d recover this fast, including the mining/oil & gas giants.
- The creation of fiat currency is habitual (think drug addict); policy will not change. “They” do not care about “your” quality of life, only preserving “the game.”
Bottom line: Barring some sort of sincere intervention to buoy the dollar (rise in rates), the CRB index is not even close to the top. We can take out 450, no problem, sending your grocery and electricity bills through the roof, yet again. At this stage, the ball is already rolling towards that direction, major props to Jakegint for seeing it early. With my money, I will hedge out my egregious monthly tomato expenses with an oversized portion of basic material stocks, over the coming weeks, months and possibly years.
Titans
That was just rude.
There’s no genuine demand, so you’d better hope the dollar keeps tanking.
That’s patently false. Go check OPEC demand revision for 2010 then get back to me.
OPEC projects an increase. Kind of talking their book. Worldwide crude and coal inventories speak a different language about energy demand. There is an awful lot of product to chew through before we come to OPEC’s conclusion.
On the other hand, I agree with Fadel that oil prices are completely disconnected from supply/demand. This proves your final idea, but shits on OPEC’s analysis.
Whatever, the point is that prices are going higher whether they should or not. I thought that was a line that would hold. Clearly I was wrong.
fuck.
fuck.
fuck.
this country is going to fuck in a hand basket. fuck you for pointing it out. since this chart is not exactly uncommon knowledge right now and is in fact the hottest trend foisted upon the internet over the past weekend…
fuck.
fuck.
fuck.
now, since everyone is on board with the idea – will the relationship shift and oil increases push the dollar down, or will the dollar decline continue to force oil up? it matters since i look to udn as my guide for market direction. i really don’t want to start looking at something as broken as uso for a guide. like dxy and udn were so much better. one thing is clear – this market is not going down again anytime soon.
Nice. For a non chart-muncher.
How long do you give this paradigm before it shifts again?
Fly, come join me in my sweat lodge of pain.
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LMAO Sweat lodge of pain……..those dumb ass hippies!
No idea. I don’t fight markets anymore. I stopped doing that on the day I stopped being a market piker, more than a decade ago.
fair enough. tomorrow might be my day to stop fighting. i am sure i will sleep better.
Fucking retarded behaviour fighting markets. Either be rich or right, take your pick.
I chose mine a while ago. Leave being right to the poor fuckheads. They can write their stuff on SeekingAlpha and get their satisfaction from the morons that follow them.
Looks to me like a return to the 50-day suggests a few days of a weak stock
market.
I don’t your point Fly. Wat is it about the chart that has your interest… is it the fall and the gradual winding back.
Sorry.
The chart is breaking out, J.
BHP, anyone? (I want an Ozzie list)
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Jake:
Yes BHP is a good buy, however you need to also consider that the currency is flying and there are suggestions which i think are right that it could reach 1.10 US… it’s 92 cents now and was 61 cents at the lows of the crash.
So the A-dollar could put a brake on their profit’s.
Think to buy commod stocks where the currency is US dollar or there are ADRs.
BHP has an ADR of course which would take some of the sting away from the currency appreciation.
Brecking out… More like rolling ovaH.
I will further my thoughts in post.
about time – welcome to our world Fly.
BTW, we rally through October….true story.
yuk;; sorry about the gam spell check.
“The Reuters-CRB Index (CCI) was originally designed to provide dynamic representation of broad trends in overall commodity prices. In order to ensure that it continued to fulfill that role, its components and formula have been periodically adjusted to reflect changes in market structure and activity.
… a minimum of two delivery months must be used to calculate the current price,
… It currently is made up of 19 commodities … sorted into 4 groups, each with different weightings. These groups are petroleum based products, which based on their importance to global trade, always make up 33% of the weightings” – seleted quote from Wikipedia
http://en.wikipedia.org/wiki/Reuters-CRB_Index
Long UYM
ATI was one of the stars of the last commodities rally. I know tech, not commodities. So, I’ll ask the panel. What do you guys think on ATI right here and for the next two years.
Thanks for the props, Pops.
Back to my sweat-lodge to speak to my ancestors.
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Load the fuck up on CBIS at the opening bell and get yo smoke on…
http://tinyurl.com/yj32yq4
Great find Jake, gotta get me some.
Not a bad post for someone who spent his day karaoke-ing.
Anton:
Did you notice he also used a chart? This could be the start of a technical Le Fly. A technically based Le Fly could simply end up owing the entire market without leverage.
Good morning.
I show a long term chart of crude. I personally do not think the crude bubble comes back any time soon same as after the 1980 oil bubble. I guess crude could retrace 50 % + after the crash, something very normal, that means crude moves to $90 to $100 the next few weeks or so. After that it should deflate to the long term trend line. The blue and green lines are drawn from me, the red lines were already in this chart.
http://x11.xanga.com/d0bf773331235256989003/w204467766.gif
Give me my fiat currency bubble NOW. I want stock and real estate prices to soar immediately.
Da Flea be channelling Jimmah Rogers, aka Señor Commodity.
Oil went up over 79.00 in Asia this morning–(if you’re considering joining the PPT, Fly posted a new screen on there for stocks to review for buys as commodities move up)
I’m just still amazed that Fly posted a chart without his usual commentary.
Somebody must have phished Fly’s logon details.
Charts and a distinct lack of cursing confirms that there is an imposter at work here.
Fly ran out of crayons?
I promised not to curse until dow 10,500.
As for the chart:
No tech analysis on it: therefore, it is acceptable.
Good point
Jed, did 9 minutes on the treadmill yesterday.
Nothing matters except for boys in ballons and Jeff Lewis.
Jazz