While China continues to make asset driven economic decisions and now looks like a traction control experiment where the economy is like a car that is driving on ice that doesn't yet know it, QE2 ignited the bunsen burner for commodity price speculation. Last I checked, Ben Bernanke has decided to continue on with QE2 but has decided that QE3 is probably a bad idea because the true positive impact of additional money coming into the economy would be more than offset by inflation. In my opinion he's making the right call, but this call is likely going to put downward pressure on commodities and other assets.

QE, of course, only happens when interest rates hit the zero bound, so it’s impossible to disentangle the effects of QE from the effects of G3 interest rates all coming down to 1% or lower. But the effect of all these investment flows is clear: if you look at commodities as an asset class, total commodity assets under management have risen from just over $150 billion at the end of 2008 to over $400 billion today.

As I mentioned in my previous post on silver, I think the price adjustment in silver will be on-going as several relationships revert […]

The silver market has been even more spectacular on the way down as it was on the way up. Since I claimed that silver was in a blowoff top on April 25, silver has lost 25% of its value. However, due to long-term fundamentals as well as shorter-term technical considerations, we believe it is time to begin scaling back into silver long positions.

About one month ago, I wrote about the overvaluation in the rare earth stocks. Even though many disagreed with the prediction that this sector was at or near a top, all of these stocks have dropped, some significantly in the past 4 weeks.

For those who think gold and silver bulls are perpetually long gold and silver no matter the present condition of the precious metals markets, that is a patently false notion. In light of the recent steep silver correction, an asset that periodically has steep corrections every year (the majority of which are induced and engineered by corrupt bankers), this does not a bursting bubble make.

Commodity prices took a beating today. This Bloomberg headline sums it up well: Commodities Sink Most Since 2008 as Stocks Fall. But […]

With rising global demand for food comes escalating cash flows that enable farmers to purchase additional fertilizers to further boost yields. Dundee Securities Senior Analyst Richard Kelertas follows junior potash explorers that have been red hot for much of the past six months. In this exclusive interview with The Energy Report, Richard shares some names that he believes could develop into bumper-crop multiples for investors.

With metals and commodities on a long-term bull-market run, investors have recently turned their attention to copper. The red metal's price recently has fallen due to mixed economic data. Copper's use as an industrial metal -- it's widely used in buildings, electronics, appliances and automobiles -- makes it sensitive to economic growth prospects.

The headlines on Japan are still uninspiring: “Japan sinking: Coast lowered by March quake, cities face daily floods at high tide” is what the Globe and Mail is going with on Monday morning. However, one analyst believes that the country’s Fukushima nuclear crisis and the global nuclear power industry will gradually stabilize, and that should be good news for patient investors who want to scoop up cheap uranium stocks right now. Greg Barnes, an analyst at TD Newcrest, raised his recommendation on Cameco Corp. (CCJ) to “buy” from “hold,” even as he trimmed his 12-month price target on the stock to $37 from $42

It might be time to pull out the Mercedes commercial from several years ago where the tagline stated, "Perception is not always reality." Trading this week in the precious and base metals clearly personifies this statement. Copper prices were rebounding on Monday, helped initially by a weaker U.S. dollar and a decline in Shanghai stockpiles to a five-month low. CPI and import data from China due out on Tuesday should give the market a sense of demand and will likely provide the direction of trade. Thus far, global data has led to the conclusion that overall demand has slowed.

While some of the silver and gold miners have not been trading in a tight relationship to the precious metals themselves, copper miner Freeport McMoRan (FCX) has been pretty steadily with the price of copper. This chart shows how FCX has traded against copper over the past two years. Although the chart presents the entire two years, I color-coded certain points on the chart to present some additional perspective on how FCX has been trading in specific timeframes.