start here

start here

The Daily IKN email digest, get all daily posts sent to you next day (& no ads)

I say things on Twitter

5/4/10

A copper rant

Here's a chart that got a bit busy with extra lines thrown in by your humble scribe.

click to enlarge

The Gold:Copper Ratio is one that Gary BiiWii sometimes features (cos he's smarter than most) and shows just how much of the red metal you can buy at any one time with a bunch of the shiny, expensive yellow metal.

The point here is that because copper has recently seen a correction from the $3.50/lb and above range down to the sub $3.30/lb range at the same time as a gold price which has surged quite nicely (and I'm happy about that), we're getting a lot of Doomsayers telling us how copper is indicating the imminent collapse of the world economy, we're all gonna die etc etc ad infinitum.

Yeah well, let 'em shrill. This chart shows that we're still very much inside normal price parameters for copper as related to real money and there's nothing much to read into the last couple of days. As for that demand collapse for copper, you ought to learn a bit of Spanish, cos then you could phone up and ask the guys over at ports in Chile and Peru just how many transport ships are queued up to take concentrate and cathode away from South America to the other side of the Pacific....I promise you that if you do, you won't be so worried about the lack of oomph in the US economy, or that Greece thingy, or whatevs.

Yep, just another bunch of anecdotal for you and in the end nothing more than an opinion. But it's also an opinion that got The IKN Weekly subscribers into Antares Minerals (ANM.v) at $1.42 and now sees the Casey sheep about to add to their (and my) net wealth thanks to the way-late reco at double the price yesterday.

For sure it took me most of 2009 to swallow the rebound in copper, admit I'd called the sector wrong and get bullish (yeah, your author is one of those weird people who doesn't have a problem in saying "i was wrong"...we're a dying breed, y'know). It's taken other people longer. But the funniest ones are those like King Douglas of Estancia that refuse to recognize plain facts in front of their eyes; copper is in demand, it's in a bull market and it's getting a whole heap of multi-billion dollar investment programs thrown at it from major miners who don't give a lickety-flip about a 20c correction. The blind, dogmatic copper bears who consider themselves market experts are wearing Emperor's New Clothes and, as in the Andersen tale, deserved to get fingers pointed at them and giggles directed at their pompous faces.

Small rant over. Mojitos served. The end.