Bernanke Warns Economy Worsening - **Buy Commodities**

Discussion in 'Wall St. News' started by achilles28, Feb 14, 2008.

  1. Bernanke Warns Economy Worsening
    nThursday February 14, 1:44 pm ET

    WASHINGTON (AP) -- Federal Reserve Chairman Ben Bernanke told Congress Thursday the economy is deteriorating and signaled a readiness to keep on lowering a key interest rate to shore things up.

    Bernanke also told the Seate Banking Committee that the one-two punch of housing and credit crises has greatly strained the economy. And he forecast sluggish growth in the near term. Bernanke also noted that hiring has slowed and that people are likely to tighten their belts further because of high energy prices and plummeting home values...

    http://biz.yahoo.com/ap/080214/congress_recession_threat.html


    Given the Feds proclivity for overkill, I'd say commodities are good long term buy right now.
     
  2. Small move to the down side in fed fund futures. News was already priced in.
     
  3. Commodities are rallying across the board. Soft commodities are doing especially well.

    Time for the breakfast trade:

    Sugar
    Coffee
    Cocoa
    OJ
     
  4. It's deflationary and bearish for everything except treasuries. Don't get too bullish towards physical commodities at "these levels".
     
  5. 1,000% agreed. Inflation during growth is bullish for commodities, inflation during slowdown/recession is bearish commodities.
     
  6. thats a joke right





    /
     
  7. gold and oil.
     
  8. Its stagflation, dawg.

    Bernacke won't let the economy dip too far without cutting rates like crazy.

    = Overkill & inflationary in the long term.
     
  9. Inflation during slowdown is bullish commodities (although less pronounced than during economic expansion).

    What do you think causes inflation during a slowdown?

    Increasing commodity/product prices.

    Stagflation = price inflation + declining economic growth.

    A good example would be US mid-1970's.
     

  10. There is no safe place to hide if the sky is about fall, you will be crushed no matter what.

    What you should ask yourself should you worry in excess about things that are being aggressively handled and taken care of people who run our monetary policy ?

    If you do not have faith in them move to Sri Lanka or Sudan and start shacking up with villagers and baking cow dung patties.
     
    #10     Feb 14, 2008