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PeakOil is You

The Financial Bubbles (merged)

Discussions about the economic and financial ramifications of PEAK OIL

Re: Stephen Roach: Commodities are a bubble

Unread postby the_red_pill » Thu 18 May 2006, 15:27:09

There are worse places to put money right now, in my opinion, like gas guzzling SUVs and McMansions. What commodities is he talking about??? Gold will ALWAYS have value, as long as there are humans around.

Morgan Stanley is like many of these others who predict one thing and then something completely opposite happens. Look at this idiot on MSNBC last week who said "19 stocks to buy for the new DOW high!" What new DOW high? 3% correction in past few days.

I think this guy also is missing the point on other things going in the world that drive up at least gold/silver in the long term. China is not the only reason: look at the tumbling US dollar and our incredible debt. Look at the instability of the middle east. One little attack in Iran and I will having to push people out of the way on my bike path b/c everyone will be cycling with $10/gal gas.

Is it possible? Maybe....so is a huge correction. That is what investing is all about, taking risk. I think there is much more risk right now in the stock market , so my bets on gold. But you believe what you want, JD.
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Re: Stephen Roach: Commodities are a bubble

Unread postby ThePostman » Thu 18 May 2006, 23:43:52

$this->bbcode_second_pass_quote('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.

I see commodities as strong from here on out, collapsing only with a general economic cataclysm. It's a new paradigm.


True, commodities can't be compared to stocks, especially the pre-bubble Nasdaq of Spring 2K. Commodities are rising due to a number of reasons, most notably inflation concerns. The drop last week was due to the perception that Fed Chairman Bernake (SP?) is done raising interests rates. Hold the phone, late June (next fed meeting) they now say he may go another quarter point. Also, there is an increasing interest in commodoties by fund managers looking to make it a portfolio base for the hedge factor. Big fund managers move a TON of money so it's not surprising to see this now in a time of rising interest rates and dollar devaluation.

On a side note, I'll take just about anything BUT gold, post PO. 80% of all extracted gold is used for jewelry, not exactly a base need in a post PO world. I know it would be used as a currency but there are much better, multifunctional metals that can be used for that purpose. Silver, copper, lead, aluminum... and so on have much more functional uses aside from rarity and ornamental use. Hopefully it wont come to that since I don't know a good metallurgist in my local area. Hmmm, viable post PO occupation?
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Re: Stephen Roach: Commodities are a bubble

Unread postby Heineken » Fri 19 May 2006, 10:08:10

Gold has held its value as currency and jewelry for thousands of years, Postman . . . I can't imagine aluminum or lead as jewelry or currency. Copper and silver, definitely---but worth less than gold.
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Re: Stephen Roach: Commodities are a bubble

Unread postby azreal60 » Fri 19 May 2006, 10:34:57

JD, I thought you had given up on peak oil? Didn't you retire your blog recently or something? Not that I don't welcome your presence, but this flip flopping is concerning. =)

As for commodities bubble, sure, I could buy it. I don't really think the high price right now is wholey supply/demand based. Our market is too buy on rumors sell on blah. But I would say you would be suprised at the under the surface, how much of it is no longer based on rumors, and how much is based on actual numbers. And that is getting worse every day. When it comes out, we'll be long past peak, and people will be like, but how did I not see this coming. LOL
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Re: Stephen Roach: Commodities are a bubble

Unread postby OilsNotWell » Fri 19 May 2006, 17:43:41

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What's the next Financial Bubble?

Unread postby mmasters » Wed 20 Sep 2006, 15:45:20

So we had the dot com bubble followed by the real estate bubble. Now that the real estate bubble is in its last throes, what will be the next financial bubble be?





[Edited to make clear the kind of bubble that is being referred to is a "financial" one]
Last edited by mmasters on Wed 20 Sep 2006, 23:25:37, edited 2 times in total.
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Re: What's the next Bubble?

Unread postby NEOPO » Wed 20 Sep 2006, 15:56:42

population.
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Re: What's the next Bubble?

Unread postby gego » Wed 20 Sep 2006, 16:02:31

The choices are bonds, stocks, commodities, currencies, and real estate.

I think you can forget bonds as they had their big bull run from the early 1980's until very recently and after 2008 it looks to me like interest rates can only go up, inversly depressing bond prices.

Since the real estate bubble has taken values to extreme excess I think it needs some long resting time, so I wouldn't look for reinflation of that bubble.

If stocks pulled back over the next year, then they may be prime for a final blow off, but nothing like the dot.com bubble.

Commodities have been in a bull run that many think is very young, so this is the best guess for the next big bubble.

In the currency area, I think that the US $ could surprise everyone over the next several years by gaining against major world currencies; this looks more like a trading swing than a new bubble.
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Re: What's the next Bubble?

Unread postby RonMN » Wed 20 Sep 2006, 16:27:09

My best guess is there will either be no more bubbles...or there will be a stock market bubble.

I don't see commodities as being a bubble, since a commodity is a usable, tangable asset they will be priced accordingly (especially when the supply of all commodities start shrinking).

What's a loaf of bread worth when 100 starving people are bidding for it? You see? It's not a bubble.

<edit> If you want to be VERY specific, I think biofuels could be a massive bubble that hasn't even begun yet. As real shortages begin & climate change rears it's ugly head further...I think biofuels will be billed as "our saviour"...and it's likely to get almost as big as "Big Oil" before the pin pops that bubble.
Last edited by RonMN on Wed 20 Sep 2006, 19:26:45, edited 1 time in total.
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Re: What's the next Bubble?

Unread postby pogoliamo » Wed 20 Sep 2006, 16:40:50

Over the next years there will be no bubble. Commodities will drop significantly, but dont hold your breath for 250$ gold or 30$ oil. Nobody will be so stupid to sell you on that prices anymore. Some shares may perform well, again, no tenbaggers anymore. An so on...

Many say: "healthcare", I am not sure, it is too obvious, but nevetheless it is worth considering it.

Maybe the best is to keep your money in cash in bank account. If there is deflation you may even get your reward. If there is a sudden opportunity you wont miss it.

What we will see in the next year will no bubbles anymore. The key words is Volatility. Rates are high and this will make the prices difficult to fix and generate more risk and uncertainity. In general greater swings in prices are benefiting those experienced in trading.

But one of the best investments is and will ever be your health, education and mental peace. If you can spend money and improve that you should never regret it. ;)

Whatever you do with your money be careful, we are in danger zone because of the global disbalances, stay away from hot places like China, Ireland, Turkey, Japan.

my 2 cents
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Re: What's the next Bubble?

Unread postby pogoliamo » Wed 20 Sep 2006, 17:22:38

$this->bbcode_second_pass_quote('pstarr', '
')Investment? Rural Cohousing-Community Development with above eminities and collective commons, livestock, structures, and equipment including barns, kitchen, shop, childcare, tractors, etc.


pstarr, you're romantic person you know that? What has investment to do your rural property hobby? And it is irresponsible to say what you did since some people may suffer after following your advice.
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Re: What's the next Bubble?

Unread postby gego » Wed 20 Sep 2006, 18:56:54

$this->bbcode_second_pass_quote('NEOPO', 'p')opulation.


I think that is a continuing bubble that has been expanding for quite some time now. It is just that it has not been pricked yet.

When I read the thread, I was just thinking of financial bubbles. Where will all the newly printed money (that must be printed to keep the economy going) flow. Roger Babson, back in the 1920's described he normal order of flow, but I can't find where I stored that book where he identified the pattern.
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Re: What's the next Bubble?

Unread postby Colorado-Valley » Wed 20 Sep 2006, 20:23:24

I'm going with styrofoam bunkhouses for farm plantations.

It's kind of like co-housing, except you work for room and board.
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Re: What's the next Bubble?

Unread postby PeakOilPrincess » Wed 20 Sep 2006, 20:30:46

$this->bbcode_second_pass_quote('mmasters', 'S')o we had the dot com bubble followed by the real estate bubble. Now that the real estate bubble is in its last throes, what's the next bubble going to be?



I would say energy. The corn to ethanol scam is attracting a lot of money right now. But what happens when the taxpayer subsidies end?


And I read that speculation played a big role in the recent run-up of record oil prices.


There is a lot of money to be made in Peak Oil if you time it right :roll:
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Re: What's the next Bubble?

Unread postby Heineken » Wed 20 Sep 2006, 21:12:20

The next bubble will be the same one that's just burst: oil and NG.
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Re: What's the next Bubble?

Unread postby mmasters » Wed 20 Sep 2006, 23:06:31

$this->bbcode_second_pass_quote('gego', '
')When I read the thread, I was just thinking of financial bubbles.


Yeah...what I had intended for the subject of the thread. Seems most get it though I'll edit the main post so it's more specific.
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Re: What's the next Financial Bubble?

Unread postby BW » Wed 20 Sep 2006, 23:25:11

Food, or the lack of due to global warming.
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Re: What's the next Financial Bubble?

Unread postby jupiters_release » Thu 21 Sep 2006, 01:20:28

$this->bbcode_second_pass_quote('mmasters', 'S')o we had the dot com bubble followed by the real estate bubble. Now that the real estate bubble is in its last throes, what will be the next financial bubble be?


Real Estate in the major cities has been on a plateau for the past year can you really say the bubbles burst yet as the prices had been skyrocketing in the years prior?

'Next bubble' assumes we live in a cyclical economy which was definitely the case but I can't see that continuing with the end of cheap energy as been discussed here enough.
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