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why would you want to invest in anything about commodities other thanmaybe gold. The commercials are in this business. What would you dowith 50,000 bushels of wheat other than pay storage on it? The sameeven for copper and as far as that goes, you get too far into silver,it also piles up to quite a weight. The world gets the idea thatinvestment and speculation are the same.
I do believe thereare wealthy people that do invest in commodities. But, they havehistory on their side in that if something is selling at a ridculouslylow price they buy it and store it. Cotton in 2002 (?) at 29 cents wasby far the lowest inflation adjusted price in history. A man with moneyand a place to put the stuff could have leveraged such an acquisitionby 50% and made 100% in a matter of months. Even at todays prices, Ithink cotton is a buy. I have often wondered why it declined as it didand my only conclusion was that wealthy people in south Asia had toliquidate their holdings and it flooded the market. There was dryweather in the cotton regions of the US and bumper crops didn't createthis bubble.
Who do you think really wants this stuff in acredit crunch? The time to buy anything is when you don't hear theworld out there bulling it. Jimmy Rogers gets a lot of credit, but thewhole commodity complex was selling at or below cost of production inthe late 1990's. Farmers went broke on 5 cent cotton in the early partof the 1900's. The 29 cent price was an inflation adjusted 1.75 centsper pound from 1905. Oil was about an inflation adjusted $2 a barrelwhen it was $12 as compared to 1967. It was $3 without a cartel backthen. Copper was 75 cents, a depression price when adjusted toinflation. Soybeans hit $4 interday, a price they hit in 1948. Coppermines were closing and the stripper wells in Texas were shut in andtaken out of production. I think we are looking at a peak incommodities short term and maybe long term.
I do believe thereare wealthy people that do invest in commodities. But, they havehistory on their side in that if something is selling at a ridculouslylow price they buy it and store it. Cotton in 2002 (?) at 29 cents wasby far the lowest inflation adjusted price in history. A man with moneyand a place to put the stuff could have leveraged such an acquisitionby 50% and made 100% in a matter of months. Even at todays prices, Ithink cotton is a buy. I have often wondered why it declined as it didand my only conclusion was that wealthy people in south Asia had toliquidate their holdings and it flooded the market. There was dryweather in the cotton regions of the US and bumper crops didn't createthis bubble.
Who do you think really wants this stuff in acredit crunch? The time to buy anything is when you don't hear theworld out there bulling it. Jimmy Rogers gets a lot of credit, but thewhole commodity complex was selling at or below cost of production inthe late 1990's. Farmers went broke on 5 cent cotton in the early partof the 1900's. The 29 cent price was an inflation adjusted 1.75 centsper pound from 1905. Oil was about an inflation adjusted $2 a barrelwhen it was $12 as compared to 1967. It was $3 without a cartel backthen. Copper was 75 cents, a depression price when adjusted toinflation. Soybeans hit $4 interday, a price they hit in 1948. Coppermines were closing and the stripper wells in Texas were shut in andtaken out of production. I think we are looking at a peak incommodities short term and maybe long term.
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