Category: Analysis

This great article shows the current commodities supercycle. Commodities are generally moving in a very wide “channel” supported by inflation with roughly 25 years cycle. The current cycle should be modified by 2008 crisis results for better understanding. It appears that the overall commodities prices are falling right now, as explained by the supercycle theory. …

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Unlike the status of oil, which is pretty clear right now, the status of gold is more complex. Gold demand is governed by exchange rate uncertainty and monetary inflation. We see conflicting trends of uncertainty and deflation, with rapidly changing monetary policies, which causes unpredictable results. We have seen a rally fueled almost entirely by …

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We are probably witnessing the biggest word-wide deflation after the big depression of 30s. This article explains how US QE excess liquidity could cause such worldwide deflation. Will be interesting to see if ECB QE and Abenomics can handle it, and how the Chinese government will regulate overproduction and speculative bubbles resulting.

The USO structure shows that buying ETF not necessarily reflects option prices due to contango. There is more than one ETF per asset, but liquidity may be more important than performance in some cases. Occasionally it is useful to buy mining companies/EFT/MLP instead of buying the commodities. The mining companies typically have much higher volatility. …

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This is an art we are planning to master eventually “Magic formula”

This article compares in depth oil inventories build-up of today and 2012.

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