Free Republic

[snip]What the commodity markets are telling us is that we’re living in a finite world, in which the rapid growth of emerging economies is placing pressure on limited supplies of raw materials, pushing up their prices. And America is, for the most part, just a bystander in this story. Some background: The last time the prices of oil and other commodities were this high, two and a half years ago, many commentators dismissed the price spike as an aberration driven by speculators. And they claimed vindication when commodity prices plunged in the second half of 2008. But that price collapse...

Within 4-5 months, if not sooner, the surge in costs at the wholesale level for food and for metals is going to be reflected in the retail side. When that occurs, consumers across the nation, both personal and business, are going to learn firsthand just how “tame” inflation is. Keep in mind this will be against a backdrop where wages are flat and the unemployment and underemployment remain stubbornly high. More of that income going to essentials leaves less for discretionary purchases. That is just simple math... ...So we have a day here today in which the commodity sector is...

DESPITE THE BURST OF POPULARITY for gold in the past year and the increase in the commodity's price, one investor who has followed the space for more than 15 years thinks prices still have room to rise. Mark Johnson, co-portfolio manager of the USAA Precious Metals and Minerals Fund (USAGX), says investors can get more bang for their buck by putting their money in gold miners than in investing in the commodity itself. Johnson's fund ranked first in its category over the past 10 years, according to Morningstar. We spoke with him last week about what metals companies he likes...

~snip~ Few voice a vision of America's troubled future more forcefully or more controversially than Glenn Beck, a one-time radio disc jockey and now Tea Party champion and influential presenter on the Fox News Channel. His prescription for the country? It's a simple one: "God, gold and guns." "If you've been watching for any length of time and still haven't looked into buying gold, what's wrong with you?" he asks on his website. Beck's also a spokesman for Goldline, a California-based company that sells bullion and coins, a role that's drawn the ire of his political opponents. Beck may...

A single trader has gobbled up to four-fifths of the copper traded in London, stockpiling it in warehouses. The unknown buyer has been building up the dominant position since at least last week, putting a squeeze on the market. According to the rules of the London Metal Exchange, the trader must lend out copper if it holds between 50pc and 80pc of the total to maintain day-to-day liquidity in the market. The trader is currently lending at a 0.5pc premium to the cash price.

UGLY. That's the only way to describe the scene in the commodity world today, as a dismal night in China, and a strengthening greenback continue to make the speculative froth go away. A few notable moves, via FinViz: Silver is off 3.5% Soybean Oil is off over 4% Wheat is off over 2% Coffee is off over 3.6% Here's the key thing to know... prior to the big selloff that started Friday, speculators were universally positioned to be long these commodities (and short the dollar), and so there wasn't much direction for this to go, and not surprisingly, the selling...

SAN FRANCISCO (MarketWatch) — Gold futures sold off Friday on concerns China will soon take steps to rein in its inflation and move to increase interest rates. Gold for December delivery /quotes/comstock/21e!f:gc\z10 (GCZ10 1,368, -35.00, -2.49%) dropped $37.80, or 2.7%, to $1,365.50 an ounce on the Comex division of the New York Mercantile Exchange. That was gold’s largest one-day drop since early July. The contract earlier traded as low as $1,359.30 an ounce, according to FactSet Research. Gold had lost more than $30 overnight, but seemed to have recovered somewhat at the start of floor trading. Nervous investors, however, pulled...

Consumers itching for new jeans, pricey dress shirts or other cotton-heavy goods might want to pay especially close attention to this year’s holiday sales. Although the rising cost of cotton hasn’t hit shoppers yet, clothing companies have said prices will start climbing as early as January. Bad weather in cotton-producing regions of India and China, and flooding in Pakistan, resulted in poor harvests this season, driving cotton prices up nearly 80% since the summer. So far, most clothing makers haven’t passed that cost increase along to consumers. But in recent weeks, the parent companies of a variety of brands –...

The Dollar: Every Man For Himself by: Axel Merk November 11, 2010 The Federal Reserve’s (Fed’s) strategy of firing up its printing press may have the debasement of the U.S. dollar as its goal (see Fed Targets Weaker Dollar), but it’s important to note that the Fed does not act in a vacuum. In our humble opinion, Fed Chair Bernanke is wrong both on substance and politics – a potentially explosive mix. On substance, the Fed recently stated in the Federal Open Market Committee (FOMC) Minutes that businesses were holding back investments because of fiscal and regulatory uncertainties. In the...

Why Commodities Are Rallying As Currencies Decline By Eric Fry 11/10/10 Laguna Beach, California – Cotton…silver…palladium…nickel…corn. What do these things have in common? Answer: They are not a dollar bill. And neither are they a euro (EUR) or a renminbi (CNY) or a rupee (INR)…or any of the other currencies that central bankers around the world are aggressively debasing. “It’s not just our own Federal Reserve that wants to destroy its currency,” observes Chris Mayer, editor of Capital & Crisis. “It seems everybody is doing it. As Eric Sprott, a great investor hailing from the Great White North, recently noted...

Gold And Silver Continue To Soar As The World Loses Faith In Currencies by: The Housing Time Bomb November 10, 2010 Gold and silver continue to soar as the world continues to lose faith in currencies. When you look at the chart below why wouldn't they? As you can see above, our financing needs vs. GDP are now worse than Greece's. If it wasn't for the Fed buying Treasuries we probably would be seeing near double digit interest rates over here. Japan's debt issues are startling to say the least. What's crazy is their currency continues to soar despite their...

Yes Virginia, There Is Global Food Inflation by: Mercenary Trader November 10, 2010 In case you were skeptical (and apparently some still are) — a quick roundup on the food inflation front: 1) Dean Foods (DF) becomes another casualty of sky-rocketing input costs (hat tip TRB). From the conference call (upon which the stock got whacked): The negative effect of this volume softness was amplified by the dramatic increase in Class II butterfat costs in the quarter, which created additional pressure on gross profits. Class II butterfat averaged $2.12 per pound in the quarter, and increased 70% from the year-ago...

Copper Reaches 28-Month High At $4/Pound by: Tim Iacono November 09, 2010 Dr. Copper seems to like what he (or she) sees in the Federal Reserve’s new plan to print hundreds of billions more U.S. dollars over the next eight months, the metal with a PhD in economics rising to the $4 a pound mark for the first time since early in 2008. Though you wouldn’t know it from the above graphic, recall that commodity prices surged in early-2008 prior to the financial market collapse later in the year, metals reaching their highs in the spring (copper at about $4.25...

Gold And Silver Just Plunged Hard Joe Weisenthal Nov. 9, 2010, 1:49 PM Easy come... Gold is down big, and silver, which had been up 5%, is now flat on the day.[snip]

Your Mind Should Be Blown By Silver Joe Weisenthal Nov. 9, 2010, 12:45 PM Gold is getting crushed today, when priced in silver. This move is insane. Silver is up over 4%, compared to less than 1% in gold.From FinViz[snip]

At its Annual Meeting in Sao Paulo/Brazil the International Textile Manufacturing Federation (ITMF) expressed its concern about the soaring cotton prices and their negative implications for the international cotton textile value chain from fiber to retail. The ITMF stated that the textile industry all over the world is not in the position to absorb any longer cotton price increases of unprecedented dimensions recorded during the past months without risking its own existence. The ITMF calls upon the retail industry to change its business model to this new business environment of higher raw material prices. During the past 20 years the...

The Rise In Silver Is Breathtaking Joe Weisenthal Nov. 8, 2010, 1:13 PM Gold broke $1400 today, and that's getting the headlines... but the real story is in silver. This chart should take your breath way. And bear in mind that the dollar is higher today, which shows just how intensely the buying in the precious metals is right now.[snip]

GOLD $1400! Joe Weisenthal Nov. 8, 2010, 11:59 AM ALERT ALERT ALERT[snip]

Federal Reserve Inflating Bubbles Pushing Agri-Foods to New Highs Commodities / Agricultural Commodities Nov 06, 2010 - 06:09 AM By: Ned W Schmidt Readily acknowledged is that first action of new U.S. Congress should be to call for resignations of all members of the Board of Governors of the Federal Reserve System.. Their irresponsible acts to date have clearly violated their mandate to provide a healthy economic environment. With Federal Reserve Bubble III, manifesting itself in the inflated and unnatural values for non dollar currencies, distorting the global economic system, they must be removed immediately and most recent policy action...

Global Implications Of Copper's Dramatic Rise November 07, 2010 By: Chester Lau On October 13, the entire world held their breath as Florencio Ávalos emerged from a 53 cm width capsule that lifted him 622 meters – almost as high as two stacked Eiffel towers – from the depths of a San Jose copper mine. It had been almost three months since the 33 trapped miners had felt the chilly night air of Chile’s Atacama Desert. Watched by over 2000 journalists across the globe, the rest of the miners emerged to the surface one by one over the lengthy 22...