We are making history in the grains

Discussion in 'Commodity Futures' started by detective, Feb 25, 2008.

  1. This is watching financial history in the making. We are seeing dramatic moves in commodities, inflation is just ready to explode from all the liquidity thrown out there in the face of tight commodity supplies.

    As I mentioned before, when you have an ever growing supply of money, growing at double digit percentages annually with no growth in the supply of commodities, you have inflation and explosive moves in oil, grains, softs, metals, etc.

    On the grains....
    Shorting wheat here is financial suicide. I don't have the balls to go long after this kind of quick move but I definitely would not short here. When there is a supply squeeze, unlike a demand story, the price goes up very quickly. We have reached that marginal point and for a nearly inelastic good like grains, you can get huge jumps in price when supply is low. Just look at what happened in the 70s and look at some of those charts. You will not want to be short now.

    BUT, there will come a time this year where the grains will be so overextended from short covering, fear, and outright mania that a short will pay off huge. Still not close to that stage yet. I'm thinking $8 corn, $22 soybeans, and $16 wheat are levels where you could say things are getting a bit out of hand. I probably wouldn't touch the short side before those price points. Of the 3 big grains, when the time comes to short, soybeans will be the best to short, with corn being the worst.
  2. you should look at the price of sugar in the early 1970's and 1980's

    now those were some explosive moves both up and down

  3. AK100


    Anyone noticed how it's almost imposible to watch the news or a sports sprogram and not hear the word 'history' repeated over and over again.

    'The first player in history to make a touchdown in 2008'

    'History was made today as Nasa launched a space shuttle for the first time ever between 10am and 11am''

    Everything is just hyped, hyped, hyped, which is why I've given up watching most TV these days.
  4. LOL. Have you been watching the grain markets over the past 20 years? This is the most active those markets have been during that whole time. Fast moves that we haven't seen since the 1970s. The current grain market is not hype. This is the most bullish market since the 70s.

    Most people here just know about their stocks and think commodities are some weird asset that are overpriced and overhyped. Yeah, go Dow 36,000!
  5. How about a massive outside-down day on all of the charts today? Minneapolis removed price limits yesterday instead of waiting for (FND) First Notice Day, Friday the 29th, on the March-08 contract.
  6. AK100


    History was made today at 12.54 UK time as AK100 made his second EVER post within 2 hours of making the first :D :D :D :D
  7. pkts


    I admire anyone who is prepared to short grains right now. At least, for their cojones. Aren't you worried about getting locked limit up multiple days? This isn't like indices where its a truly 24 hour market with few gaps and lock moves. Short selling this market takes some courage!

    Besides, how do you know when it's gonna reverse? I remember back on Jan 23rd we locked limit down and then gapped higher in AH.
  8. kanellop


    Hello Detective.

    Before think anything else think that:

    With the Tight Stcoks/Usage Ratio for the Corn, Soybeans and Wheat exist and another Factor that can make the above Commodities to raise even more.

    Drought conditions in Major Areas of the World.

    Kind Regards,

    George Kanellopoulos.