FT Article.
"According to Wikipedia, compulsive hoarding is a disorder characterized by the excessive acquisition and inability or unwillingness to discard large quantities of objects that would seemingly qualify as useless or without value.
We’d like to make the case that China is suffering from this disorder and that we’re at the stage where a psychopharmacological intervention needs to be organised by China’s friends and family. If not China’s hoarding tendencies could destroy the world as we know it."
Explains why I was wrong on my 2010 "short copper" admonition.
Does this mean one should be looking to short copper?
Not neccesarily.
"Slowly, the truth on whether the global copper market is really tight is coming out. It illustrates just how large an involvement the financial institutions have become to the copper industry. It shows, too, that by throwing money at a market, prices can be driven higher. In the process, however, the delicate balance between supply and the industry’s requirements for a basic material used to produce a range of essential products is destroyed. In short, copper is becoming a financial asset in place of its historic role as an industrial metal.
I have told my students that I see the next counterparty financial crisis coming from the commodity makets (or Japan CDS). I thought it would be because a large commercial blew itself up (Exxon, BH Bilton). Maybe copper will be the new way that banks find to pull the pin.
Try not to be standing close by.
"According to Wikipedia, compulsive hoarding is a disorder characterized by the excessive acquisition and inability or unwillingness to discard large quantities of objects that would seemingly qualify as useless or without value.
We’d like to make the case that China is suffering from this disorder and that we’re at the stage where a psychopharmacological intervention needs to be organised by China’s friends and family. If not China’s hoarding tendencies could destroy the world as we know it."
Explains why I was wrong on my 2010 "short copper" admonition.
Does this mean one should be looking to short copper?
Not neccesarily.
"Slowly, the truth on whether the global copper market is really tight is coming out. It illustrates just how large an involvement the financial institutions have become to the copper industry. It shows, too, that by throwing money at a market, prices can be driven higher. In the process, however, the delicate balance between supply and the industry’s requirements for a basic material used to produce a range of essential products is destroyed. In short, copper is becoming a financial asset in place of its historic role as an industrial metal.
I have told my students that I see the next counterparty financial crisis coming from the commodity makets (or Japan CDS). I thought it would be because a large commercial blew itself up (Exxon, BH Bilton). Maybe copper will be the new way that banks find to pull the pin.
Try not to be standing close by.
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