[drew]

$this->bbcode_second_pass_quote('Aaron', 'T')his exponential growth game is similar to "pyramid" schemes, & only works as long as new money flows in from the bottom.

[MikeB]

HOuses in our neck of the woods have not been selling.

My neighbor has been trying to sell his old colonial for well over a year.


Every time I drive by, there's "NEW" price on it!


"New and improved price!" :P

[deafskeptic]

According to the Charlotte version of Creative Loafing, Mecklenburg County leads the state in foreclosures (printed a month or so ago) and the <a href="http://www.charlotte.com/mld/charlotte/news/ special_packages/foreclosure">local paper</a> states that mortage fraud has been a growing problem ifor low income residents in Charlotte. Things are going to get interesting in this town known for it's banks.

[Kingcoal]

I agree that there will be corrections, but this isn't the first housing bubble and it probably won't be the last. The dollar has been "crashing" since the inception of the Federal Reserve. It's the game that has been played over and over since the dollar has been a fiat currency, first inside of US borders, then also internationally. Much of the rest of the world follows suit; housing bubbles are not just an American phenomenon, many other countries have their own real estate asset bubbles to deal with.

[ReserveGrowthRulz]

$this->bbcode_second_pass_quote('Kingcoal', 'I') agree that there will be corrections, but this isn't the first housing bubble and it probably won't be the last. The dollar has been "crashing" since the inception of the Federal Reserve. It's the game that has been played over and over since the dollar has been a fiat currency, first inside of US borders, then also internationally. Much of the rest of the world follows suit; housing bubbles are not just an American phenomenon, many other countries have their own real estate asset bubbles to deal with.

[Marklar]

$this->bbcode_second_pass_quote('', '
')Please! You are sounding WAY too rational. If you aren't stockpiling gasoline and bullets and gold in your basement you don't fit in around and must be NUTS!

[azreal60]

Saying there have been things happening on a smaller scale since the inception of fiat currency is like saying that since the time the ocean existed there have been waves. That doesn't mean the tsunami has any less power. Never in history has so much money been tied up in our homes. And by tied up, I mean not just one loan, but 2 or more loans are on our homes nowadays. And if we suddenly can't pay that, it Will be like a house of cards.

Don't get me wrong, I get your point that things like this have happened in the past. The difference is, things where alot less complex when they where happening. Each time society reaches a new order of complexity, damage to the fundementals reaches a new and frightening peak. After all, the higher you climb, the farther you have to fall.

[DesertBear2]

$this->bbcode_second_pass_quote('ReserveGrowthRulz', '
')Please! You are sounding WAY too rational. If you aren't stockpiling gasoline and bullets and gold in your basement you don't fit in around and must be NUTS!

[markam]

$this->bbcode_second_pass_quote('DesertBear2', '
')What is the best way to go about storing gasoline in the basement?

[rogerhb]

$this->bbcode_second_pass_quote('DesertBear2', '')$this->bbcode_second_pass_quote('ReserveGrowthRulz', '
')Please! You are sounding WAY too rational. If you aren't stockpiling gasoline and bullets and gold in your basement you don't fit in around and must be NUTS!

[The_Virginian]

"Stabil" drops in sealed DOT approved containers.

your gas should be good up to a year. If you live in a huricaine or other natural disaster zone, having 10 gallons or more on hand is a bright idea.

[JoeCoal]

$this->bbcode_second_pass_quote('Marklar', '')$this->bbcode_second_pass_quote('', '
')Please! You are sounding WAY too rational. If you aren't stockpiling gasoline and bullets and gold in your basement you don't fit in around and must be NUTS!

[deafskeptic]

Let's not forget the grenades and fireworks. That way you'd go out in style.

[JohnDenver]

For the benefit of those of you who aren't old timers, Stephen Roach is the Chief Economist at Morgan Stanley. He's been trotted out endlessly* on this forum as key mainstream source suggesting that the economy is about to go down the toilet any second now.

So I guess you doomer commodity bulls are going to have to suck it up, and swallow a bitter pill here. Roach says its a bubble, just like the dotcoms:

$this->bbcode_second_pass_quote('', 'M')organ Stanley's Chief Economist Stephen Roach has just come out with a report on the current commodity bull run. The report suggests that there might be a bubble in commodities and that prices resemble patterns seen during the dotcom boom.

[Doly]

If there's something I've figured out in my recent study of the economy, is that the economists are totally baffled by what's going on lately. An article in the Guardian summed it up beautifully: commodities are going up, stocks are going up and the housing market is going up... and all that is not supposed to happen at once.

We are in uncharted territory here, and your guess is as good as mine on what happens next.

[Heineken]

I don't see how commodities can be compared to dot-com stocks of the late 1990s; most of the latter consisted entirely of air.

Roach is viewing the commodities crunch in the usual economist way, i.e., the market will fix the problem. I don't see how that is possible as long as Chindia continues to follow the path of the US. The demand for commodities from these new markets is virtually infinite. The supply, of course, is not. Although prices will fluctuate, I see commodities as strong from here on out, collapsing only with a general economic cataclysm. It's a new paradigm.

[dub_scratch]

Roach thinks there is a lot of speculation in the commodities markets these days, thus the bubble. If it were supply issues causing this bull run then there is no quick price relief in the cards. Commodities take a long time for the markets to respond by bringing on new supplies.

As a soft-lander/optimist, I really hope that oil prices do not veer off their upward trend. Energy efficiency, conservation, cultural adaptation & alternative energy are all dependent on oil prices going up in incremental fashion. The past three years of oil price rise has been about as perfect of an adjustment period as I could have imagined, and I have made my own transition from doomer to soft-lander/optimist because of it. The last thing I would like to see is an oil price crash that will stimulate the American public's unhealthy relationship with cars & energy squandering. If oil prices were to go down and stay low, I may go right back to the doomer camp.

[Chaparral]

He can't be talking about corn. I'm long C-Z07 and the deliveries just keep coming hot and heavy inspite of the high prices. Export inspections continue to either hit the high end of estimates or exceed everyone's expectations.

He can't be talking soybeans. The deliveries of those continue to meet and even exceed expectations now and then.

Is he talking about the meats? Lean hogs? Feeders? Pork Bellies? Those have been in the doldrums for a while now. The commercials have very high net long positons.

He can't be talking HU-M06. The commercials are easing out of their short positons according to the last COT report and that is for May 9th data where the stuff spent part of the week below two bucks a gallon.

Is he talking about lead or nickel? Those went up inspite of copper and aluminum taking a dump.

Is he talking about cotton? The stuff is priced quite low compared to where it's been in recent months.

Is he talking about Platinum? Gold and silver gimp along after Monday's correction yet platinum shows a gain. What about Rhodium and Palladium? I think someone is planning on building a lot of three-way cats or cracking towers with those.

Is this Roach guy one of those who only thinks of gold and silver when he thinks of commodities?


Here's a question fer ya: Why is money flowing into US Treasury bond futures today?

[Heineken]

Here's the thing: Any meaningful drop in the price of oil (and some other commodities) will just spur demand, causing prices to rise again. No way out of this, not with 200,000 new mouths every day, spare capacities razor thin, and ongoing industrialization of Asia.