[[wysiwyg_imageupload:1065:]]By Jeff Rubin
Just as the fiscal crisis sweeping through the major oil-consuming nations of the world is cutting funding for green energy, one of the most expensive yet least efficient of green fuels, corn-based ethanol, has been given another year of generous taxpayer support in the US.
The promotion of corn-based ethanol has been America’s principal policy response to its growing dependence on ever more costly foreign oil. Fuelled by a federal tax credit of 45 cents per gallon and a crippling 54 cent per gallon tariff against competing Brazilian sugar-based ethanol, American ethanol production has grown exponentially over the course of the last decade to around 12 billion gallons per year in 2010. And it’s targeted to grow to as much as 36 billion gallons by 2022. Food inflation, particularly with respect to corn prices, has moved in step. Thanks in large measure to ethanol demand, US corn prices are up some 40 per cent this year.
[[wysiwyg_imageupload:1065:]]By Jeff Rubin
[[wysiwyg_imageupload:1058:]]By Gary Dorsch
In 2009, China spent $89-billion for imports of crude oil, $50-billion on iron ore, and $30-billion on copper. However, even before the final tally for 2010’s import bill is calculated, Beijing understands that the era of cheap commodities is over, and that if continues to target economic growth of 9% or more, it’ll have to pay a heavy price. Beijing has been backed into a corner, by the US Treasury, and its powerful allies at Japan’s ministry of finance, and must soon decide how to navigate its economy in the year ahead. The threat of hyper-inflation looms on the horizon.
By Stewart Thomson
1. Golden Crystal. Whether you buy breakouts (difficult) or price weakness (best), it is important to keep your charts simple and clear. Here's the Gold Bullion Chart at around 3am this morning.
2. Notice the focus on the "here and now", which is the $1370 to $1390 price range. The actual range is more like 1372 to 1392, but it is important to always focus on your failure to analyse, rather than your ability to analyse.
[[wysiwyg_imageupload:1024:]]By Jeb Handwerger
What is so rare as a day in June, the poet asks? The answer..a sector in play, on a perfect day. The rare earth sector is experiencing an explosion of investment interest as China continues to place restrictions on Rare Earth Oxides (REO).
Resource investors are drooling over the potential price explosion like Homer does for donuts. Every year around this time a new craze emerges to capture the imagination. We lived through "hula hoops", "beanie babies" and "cabbage patch kids". Now rare earths have become the latest "must have" for the holidays.
[[wysiwyg_imageupload:1006:]]By Gary Dorsch
Exactly two-years ago, - the world's commodity and stock markets were caught in the grips of a death spiral. As revelations of the extreme magnitude of the sub-prime mortgage debt crisis began to surface, banks began cutting off funding to companies and other borrowers, despite efforts by governments and central banks to unlock jammed credit markets. Global cross-border lending by banks shrank $5-trillion in the last nine months of 2008, the sharpest fall ever recorded.
[[wysiwyg_imageupload:982:]]By David Coffin
It doesn’t matter if you’re naughty or nice; Santa has been coming early to resource investors everywhere this year. A somewhat ironic combination of fear buying in precious metals and fearless buying in most everything else has generated gains across the sector this month.
In fact, the gains were good enough to have us checking the numbers on many development stories to make sure we were not wearing rose coloured glasses. We were mildly surprised to find that many stories looked, if not cheap, then at least like they still had headroom. That is a testament to just how good metal price moves were this month.
By Global Intelligence
SITUATION: In early 2009, Russia inaugurated its first liquefied natural gas (LNG) plant for East Asia at Sakhalin. After ramping up to three times its initial capacity, it will supply roughly 5% of world LNG. It is currently expected that Japan will receive two-thirds of initial exports with the rest going to South Korea and North America.
By Steve Saville
Our view is, and has always been, that the rapid economic growth occurring in countries such as China and India is NOT the primary driver of the long-term bull market in commodities that is often referred to as the "commodity supercycle". Instead, we see the bull market as mostly an effect of inflation, where inflation is defined as an expansion of the money supply. One of the consequences of inflation is a reduction in the value of money relative to some of the things that money can buy.
By ETF Tudor
With its array of natural resources, supply of commodities and enviable banking system, Canada remains relatively appealing and poses an opportunity for investors.
By Black Swan Capital
Hopefully you know by now. In fact, it would have been nice to know a month ago ... or better yet six months ago (or even better yet two years ago!) ...
That's when copper started up. And today it's challenging record highs after screaming higher so far this month. (The previous peak was early 2008.)