11 replies to this topic

[dougie]

What gives? Lumber prices soaring through the roof. Oil on fire. Copper banging  the pot.

Everywhere you turn there are massive shortages of nearly everything except vaccines.

 

It seems to me we are never going to see the low prices of many important commodities ever. Is that a foolish thought? Are we entering a really dangerous perod of time here?

 

[stubaby]

Could be dougie, but most likely not structural (yet), just supply shortages caused by lockdowns meeting repressed demand returning with some overshoot on the upside.  Think of this period as the opposite "mirror image" of March 2020 - it didn't last and neither will this extreme.

[dougie]

Could be dougie, but most likely not structural (yet), just supply shortages caused by lockdowns meeting repressed demand returning with some overshoot on the upside.  Think of this period as the opposite "mirror image" of March 2020 - it didn't last and neither will this extreme.

i hope you are right but i doubt prices come down to where they were.

[senorBS]

What gives? Lumber prices soaring through the roof. Oil on fire. Copper banging  the pot.

Everywhere you turn there are massive shortages of nearly everything except vaccines.

 

It seems to me we are never going to see the low prices of many important commodities ever. Is that a foolish thought? Are we entering a really dangerous perod of time here?

 

hard to say longer term, some will depend on whether we keep on with this incredibly easy monetary policy/fiscal spending madness - that causes distortions as well. Then there is the psychological part where an "inflation mindset" can take hold and that can be hard to break "if" we get there as Studaby alluded to. I thought Tudor Jones comments past few days on the importance of what the Fed says about policy may be more important "this time" than we think. Certainly interesting times and I do think we are likely entering a much more "dangerous" time than we've seen for a while, hard for me seeing that gold/miners do not do well over the next few years (of course with big swings), we see

 

Senor

[linrom1]

 

What gives? Lumber prices soaring through the roof. Oil on fire. Copper banging  the pot.

Everywhere you turn there are massive shortages of nearly everything except vaccines.

 

It seems to me we are never going to see the low prices of many important commodities ever. Is that a foolish thought? Are we entering a really dangerous perod of time here?

 

hard to say longer term, some will depend on whether we keep on with this incredibly easy monetary policy/fiscal spending madness - that causes distortions as well. Then there is the psychological part where an "inflation mindset" can take hold and that can be hard to break "if" we get there as Studaby alluded to. I thought Tudor Jones comments past few days on the importance of what the Fed says about policy may be more important "this time" than we think. Certainly interesting times and I do think we are likely entering a much more "dangerous" time than we've seen for a while, hard for me seeing that gold/miners do not do well over the next few years (of course with big swings), we see

 

Senor

 

Well there were heavy sellers on his comments. It makes one wonder if that was PTJ?

[senorBS]

haven't even mentioned wage inflation which has gained traction as well

 

Dharma and I have mentioned the coming "stagflation" for years, well its no longer "coming", it is here. I lived through the stagflation of the later 70's and early 80's when Volker raised rates to 13-14%! I remember being a rookie stockbroker at EF Hutton (are you "listening" lol) cold calling in 1982 with AAA rated Calif munis at 13% - hard to believe that ever happened isn't it?

 

Senor

Edited by senorBS, 16 June 2021 - 10:31 AM.

[senorBS]

and now we have China introducing more price controls - the history of these are not good

 

China to strengthen commodity price controls in five-year plan | Reuters

 

Senor

[senorBS]

I copied this from a poster I respect a LOT on another board I frequent, he says very well exactly how I feel:

 

"in the answer to a question just asked Powell said, IMO quite seriously, that the real problem might be that "inflation soon could be quite low"

THIS is what they are afraid of that the inflation shock will lead to real deflation.

They can't permit actual deflation so this is the reason the printing/bond manipulation/rates environment will have to be as it is now. The excuse will always be there to move the fight of inflation into some outer year.

If they fight inflation for real, the US political system as it exists now might not actually survive the experience in its current incarnation.

Nor might the political systems around much of the world."

 

Dharma's "Hotel California" playin for the Fed in the background....

 

Senor

Edited by senorBS, 16 June 2021 - 06:58 PM.

[senorBS]

and another on point comment from that same poster about today's Fed meeting:

 

 

"I think that as people sleep on this tonight they will wake up and realize what the Fed is really saying is "We have to talk about stuff like responsible adults, but we will NEVER, EVER raise rates" because as each year goes by the sheer volume of debt being added to the economy makes the explosion all the larger.

I don't think they can even modestly taper QE anymore without having a significant impact on the economy, especially in the 2H of this year as the Transfer payments/payment moratoriums end.

they are admitting that inflation can be 3 or 4% and they will excuse it."

 

Got gold/miners/silver?

 

Senor

[dougie]

haven't even mentioned wage inflation which has gained traction as well

 

Dharma and I have mentioned the coming "stagflation" for years, well its no longer "coming", it is here. I lived through the stagflation of the later 70's and early 80's when Volker raised rates to 13-14%! I remember being a rookie stockbroker at EF Hutton (are you "listening" lol) cold calling in 1982 with AAA rated Calif munis at 13% - hard to believe that ever happened isn't it?

 

Senor

13%. wasnt NYC 20% at one point? fortunes were made