This market is essentially an ADHD addled teenager fresh off of getting bombed on PCP.
ERX was down more than 3%. Now, with little to no improvement in the oil markets, ERX is for no real reason down only a few hundredths of a percentage.
Random other positions in my holdings skipped unexpectedly up, for no real rhyme or reason, while volatility is cropping up in surprising ways.
Meanwhile, Congress is no closer to coming to an agreement, and so any decisive relief that may be experienced remains out of sight. Until those things are known, disagreement of the outcome will keep prices jerking up and down in choppy swings. However, it’s equally as dangerous to bet these swings will continue as it is to bet on the wrong direction.
This is not an easily traded situation. You want to play all points of the field, while shirking the crowded positions.
To make matters more unstable, there are riots and unrest cropping up all over the planet. The Middle East is obvious, but now Europe is on the cusp of crisis, there are reports of massive shortages in developing countries, and the whole world seems on the verge of a complete restructuring of global leadership.
The second biggest danger right now, aside from all out rebellion and warfare, is the damage that is being done to food supplies and basic materials. There is no way, judging by the reactions of governments to these developments, that investment in critical infrastructure is being made. Take for instance Argentina. They’ve been waging war against the big grain exporters, like Bunge.
Watch closely as losses are forced on the grain exporters, forcing them to shut down operations, which will both drive prices up higher while paving the way for a future shortage. I would not be surprised if riots started cropping up in Argentina in the next year or two, or in some similar country in the South Americas, as they have in the Middle East.
All in all, these are interesting times we live in friends. Watch your back, and be safe.
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ag should be our biggest winner by the q3, then beyond. we will experience the worst harvest yet, this year.
Grains look toppy here though again, Cain.
Been in and and out of JGG playing them though, instead of the single grain ETFs.
The softs (except for OJ) all look like they have put in short-term bottoms for now.