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VRS - who has written 36706 posts on Opalesque Commodities Briefing.


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What’s Behind the Current Global Commodity Price Slump?

Posted on 01 September 2014

As the year 2014 got underway, it looked as if commodities in general, and energy, in particular, were headed for a boom year. And with an accelerating economic recovery, U.S. Treasury interest yields surprisingly dropping to post-recession lows, along with deteriorating geopolitical turbulence, the first quarter did not disappoint.

How to Simplify Commodities

Posted on 01 September 2014

Investors have long known that adding a dash of commodities to their portfolios can be beneficial to their wealth. The only problem has been implementing this strategy. It’s difficult to know which commodities are a good bet, and broad commodities-focused indexes are inadequate. Investors also worry that futures prices don’t always track the spot market.

Australia: Rich in Commodities but not Oil

Posted on 01 September 2014

Australia is rich in commodities, including fossil fuel and uranium reserves. It is one of the few countries belonging to the Organization for Economic Cooperation and Development (OECD) that is a significant net energy exporter, sending nearly 70 percent of its total energy production (excluding energy imports) overseas, according to data from Australia’s Bureau of Resource and Energy Economics (BREE).

OPEC Oil Output Hits One-Year High in August on Nigeria

Posted on 01 September 2014

OPEC crude oil production increased to a one-year high in August, led by surging output in Nigeria, a Bloomberg survey showed. Production by the 12-member Organization of Petroleum Exporting Countries rose by 891,000 barrels a day to 31.033 million, according to the survey of oil companies, producers and analysts. Last month’s total was revised 80,000 barrels a day lower to 30.142 million because of changes to the Nigerian and Iranian estimates.

Speculators Turn More Bullish on Oil Before Labor Day

Posted on 01 September 2014

Hedge funds increased bullish positions on crude oil for the first time in more than a month, benefiting from a rally before the Labor Day holiday weekend.

How the US found an extraordinary solution to oil supply risk

Posted on 01 September 2014

A new report from the US Energy Information Administration highlights the extraordinary rise in US liquid fuel production over the past few years and how it has helped off-set unplanned supply disruptions which are running at the highest level since the Iraq-Kuwait war some 24 years ago.

When Will The Peak Oil Crisis Begin?

Posted on 01 September 2014

For those following the world oil production situation, it has been clear for some time that the only factor keeping global crude output from moving lower is the continuing increase in U.S. shale oil production, mostly from Texas and North Dakota. Needless to say, once the fabled “peak” comes oil and gasoline prices are certain to move higher, triggering a series of economic events – most of which will not be good for the global economy.

Why The Energy Markets May Be At A Turning Point

Posted on 01 September 2014

The U.S. energy markets tumbled this summer due to a bearish combination of unusually mild weather, the strengthening U.S. dollar, and rising supplies. West Texas crude oil dropped by approximately 14 percent and Henry Hub natural gas fell just over 20 percent.

Hedge Funds Cut Gold Bull Bets to Lowest Since June

Posted on 01 September 2014

After gold’s rally in the first half of the year beat gains for commodities, equities and Treasuries, bullion is back to being out of favor with investors. Hedge funds cut their bullish gold bets for the fourth week in five, sending holdings to a two-month low, U.S. government data show. Open interest in New York futures is the smallest in five years, and assets in global exchange-traded products backed by the metal in August posted the biggest monthly drop since May.

Africa’s Biggest Fund Manager Favors Platinum Equities Over Gold

Posted on 01 September 2014

Africa’s biggest fund manager favors South African platinum equities over those of gold, betting against the price performance of the metals and the share performance of the companies that mine them..

Gold’s Headwinds Now Starting To Fade - Look For Higher Prices Ahead

Posted on 01 September 2014

Positive seasonal factors are now in effect for precious metals and this should help push prices higher in the period ahead. A stronger dollar continues to limit gold and silver price gains, however, a dovish Federal Reserve could cause the dollar rally to reverse course. Safe haven demand remains strong and this too could boost demand precious metals this fall.

Top 20 largest gold reserves by country

Posted on 01 September 2014

After a long bull move gold is at a crossroads. Depending on who you talk to, the 15-year bull market in gold has ended or is taking a breather preparing for its next leg up. The massive inflation predicted from the enormous liquidity poured into the system by central banks around the world has not arrived so gold has pulled back from its 2011 high. Gold is the most followed and globally traded commodity. But not just by retail investors watching late night TV. While there is no more gold [...]

Artificially low Silver prices and monetary policy gone wrong

Posted on 01 September 2014

The purpose of a taboo is to avoid destruction. Those who do not respect the taboos of a culture endanger the cultural identity. Therefore, disregarding the taboos produces self-destruction and/or destruction.

How ETFs Define “Quality”

Posted on 01 September 2014

The ETF industry has a new favorite product: “Quality” ETFs, which focus on stocks that should hold up better in a downturn. How to tell them apart. “Quality stock investing” is the latest marketing meme in ETFs. But for some investors, it’s a joke: How do you define “quality”?

Best And Worst ETFs Of The Week Amid Summer Send-Off

Posted on 01 September 2014

The markets managed to finally hurdle the psychologically significant 2,000 mark in the S&P 500 Index this week. The broad large-cap index remained largely flat, however, after Monday’s strong leap forward.

London Metal Exchange to push for reform after US judge dismisses suits

Posted on 01 September 2014

The end of class action lawsuits in the United States against the London Metal Exchange will open the way for a long-promised reform of the aluminium warehousing issue and allow the bourse to focus on its expansion in Asia, according to brokers.

World’s first digital currency from Ecuador central bank

Posted on 01 September 2014

Ecuador is planning to create what it calls the world’s first digital currency issued by a central bank which some analysts believe could be a first step toward abandoning the country’s existing currency the US dollar.

Poll: 44% across UK oppose currency union with iScotland

Posted on 01 September 2014

More than 40% of people from across Britain do not believe there should be a currency union if Scotland becomes independent, according to a poll. The Springboard UK poll for the Sunday Express carried out in England, Wales and Scotland found 44% of those asked the question “If Scotland votes for independence should there be a currency union?” replied with “No”.

China’s national carbon market to start in 2016 -official

Posted on 01 September 2014

China plans to roll out its national market for carbon permit trading in 2016, an official said Sunday, adding that the government is close to finalising rules for what will be the world’s biggest emissions trading scheme.

Carbon prices to average EUR23 in the 2020, analysts say

Posted on 01 September 2014

Thomson Reuters predicts without emissions trading scheme reform and 2030 climate targets EU Allowances may remain at €14. EU carbon prices are set to more than treble to an average of around €23 a tonne during the 2020s, according to a new analysis.

Global recovery continues at varying speeds, equity the best bet: Bank J Safra Sarasin

Posted on 01 September 2014

As the global economic recovery is continuing at varying speeds equities remain the most attractive asset class mid-term, a report by Bank J. Safra Sarasin said. The US leads the global cycle with growth significantly higher than in Euroland.

Major banks’ first-half commodity revenue climbs 21 percent

Posted on 29 August 2014

Commodities revenue at the top 10 investment banks climbed by about a fifth in the first half of the year as a cold winter boosted business in U.S. power and gas and some investors returned to the sector, a consultancy said.

A Look At Various Commodities And Weather

Posted on 29 August 2014

In a world captivated, or should I say “cap-sized”, by the exasperating events in Gaza, Ferguson, Ukraine and now most recently by ISIS, it’s almost not worth talking about where the opportunities have been and where they might be in the financial markets. There are far greater concerns about the nature and safety of our planet.

Oil and gas investment boom ‘fading fast’

Posted on 29 August 2014

The boom in oil and gas investment that insulated Australia from the Global Financial Crisis is fading fast and there are few signs of new projects on the horizon, EnergyQuest says.

A New American Oil Bonanza

Posted on 29 August 2014

Whenever overseas turmoil has pushed energy prices higher in the past, John and Beth Hughes have curbed their driving by eating at home more and shopping locally. But the current crises in Ukraine and Iraq did not stop them from making the two-hour drive to San Antonio to visit the Alamo, have a chicken fried steak lunch, and buy fish for their tank before driving home to Corpus Christi.

Falling Oil Prices Could Force Venezuela to Veer off the Chávez Formula

Posted on 29 August 2014

Venezuela’s embattled Nicolás Maduro has spent most of his 19-month presidency fighting to avoid changing any of the economic policies he inherited from his predecessor, the late Hugo Chávez. Maduro has repeatedly told his countrymen that Chávez’s socialist blueprint is working in spite of mounting shortages, soaring inflation, and two maxi-devaluations in the past two years. Now falling oil prices may force his hand.

OPEC oil output rises in August as Libyan recovery holds

Posted on 29 August 2014

OPEC’s oil production has risen in August from July, a Reuters survey found on Thursday, as a recovery in Libyan supply held up and Angola and Iran boosted supplies, outweighing a further decline in Iraq.

Iraq and Libya spark oil production fears

Posted on 29 August 2014

The world fears an oil crisis will occur if the security situation in oil-producing countries does not improve, especially in Iraq and Libya, two prominent producing countries. Everyone is concerned and is expecting the suspension of the Iraqi oil supply at any time now. If an Iraqi oil disaster occurs — especially if production allocated for export is halted — oil prices will easily hit an average of $130 per barrel and will only cease to fluctuate when Iraq regains calm and stability.

Global green energy growth threatened by policy uncertainty, IEA warns

Posted on 29 August 2014

Global green energy expansion may stall unless governments can put in place more stable and long-term policies, the International Energy Agency (IEA) warned.

IEA expects $1.7 trillion in clean-energy investments through 2020

Posted on 29 August 2014

Investments in new clean-energy capacity will total $USUS1.61 trillion ($1.72 trillion) through 2020 even as the expansion of renewables is expected to slow, the International Energy Agency said.

Global renewable energy expansion to slow to 2020: IEA

Posted on 29 August 2014

Growth in global renewable energy capacity will slow to 2020 if uncertain government policies continue to threaten investment, the International Energy Agency (IEA) said on Thursday.

Top 20 largest gold reserves by country

Posted on 29 August 2014

After a long bull move gold is at a crossroads. Depending on who you talk to, the 15-year bull market in gold has ended or is taking a breather preparing for its next leg up. The massive inflation predicted from the enormous liquidity poured into the system by central banks around the world has not arrived so gold has pulled back from its 2011 high.

Check Out Silver For A View On Gold

Posted on 29 August 2014

For gold traders, the last few months have been challenging to say the least, with the precious metal lurching higher and lower driven by fear, the US Dollar, a singular lack of any inflation and seasonal supply and demand. At times like this it can help to look at related or associated markets for an alternative view.

Gold demand: Not so hot, not so cold

Posted on 29 August 2014

As pointed out by the Fed Chairman Janet Yellen, how much slack there is in the U.S. labour market is still up for debate. The Fed uses a Labour Market Conditions Index, which consists of 19 factors. The undertone is that the underuse of the labour force is still big although a few Fed governors have been saying that the interest rates will rise sooner than expected.

Let’s talk diamonds

Posted on 29 August 2014

Let’s talk diamonds for a change. Often it seems that gold gets all the fun when I write and speak about precious metals and minerals. But Vancouver-based Lucara Diamond, which we own in both our Gold and Precious Metals Fund (USERX) and World Precious Minerals Fund (UNWPX), has been turning heads here at U.S. Global Investors lately for a number of reasons, the most notable being that it continues to report stellar returns.

Silver Pricing Change Takes Effect; Other Metals to Follow

Posted on 29 August 2014

With the launch in mid-August of a new system to arrive at the price for silver, precious metals investors are dealing with the first in a series of changes in how the market prices of silver, gold, platinum and palladium are reached.

Industrial Metals on the Mend

Posted on 29 August 2014

A rise in the global population, growth in the Chinese economy, urbanization of other Asian countries and the increasing requirements of developed countries have created an unprecedented demand for industrial or base metals given their usage in a wide variety of applications in the construction and manufacturing businesses.

Goldman Sachs sees nickel price rally continuing into 2015

Posted on 29 August 2014

US investment bank Goldman Sachs said the refined nickel market has shifted from a major surplus in 2013 to a much smaller surplus in 2014, according to a research note Thursday, adding that prices are likely to continue to rally into 2015.

Zinc, nickel prices to ‘move dramatically higher’ - Scotiabank

Posted on 29 August 2014

Scotiabank’s Metal & Mineral Index rallied strong in July as base metal prices jumped higher across a broad front—“pushed up in part by exuberance over better-than-expected results for China’s economy”, observed Scotiabank economist Patricia Mohr in an analysis published Wednesday.

Gold ETFs Lose Predictive Power

Posted on 29 August 2014

During the height of gold’s bull run, market observers frequently complained that exchange traded products backed by physical holdings of bullion, including the SPDR Gold Shares, were criticized for being the tail wagging the dog of the gold market.

3 Reasons Market Vectors Gold Miners ETF (GDX) Could Fall

Posted on 29 August 2014

A week or so ago, I wrote an article that listed three reasons to buy Market Vectors Gold Miners ETF . It’s important to understand that gold went on an unprecedented bull run from the early 2000s through late 2011, but it has largely been in decline since. Further, gold has historically been an underperforming asset as compared to the stock market.

Investing In Natural Gas? Eye ETFs, Seasonality

Posted on 29 August 2014

Investing in natural gas sounds like a winner: demand keeps rising, fracking promises to meet that demand, and prices have jumped in the past several years. Meanwhile it’s touted as an alternative to coal, and to a lesser extent, oil. There’s a lot to like.

4 Currency ETFs To Watch Right Now

Posted on 29 August 2014

The U.S. dollar is breaking out and that means a number of currency exchange-traded funds are seeing significant moves right now. Currency ETFs provide a way to access the foreign exchange (forex) market, while using the stock market to do it.

Commodities trading the latest move by Shanghai to talk up free trade zone

Posted on 29 August 2014

Commodities exchanges the latest idea for city’s free trade zone, and part of its plan to establish itself as a hub for international commerce. In the latest attempt to raise the profile of its Hong Kong-style free port, Shanghai has unveiled ambitious plans to create a clutch of international commodity trading platforms in its free-trade zone (FTZ).

Egypt in talks with Chicago Merc to build biggest commodities exchange in MENA

Posted on 29 August 2014

Egypt plans to get benefit from the Chicago Mercantile Exchange (CME)’s wide expertise, seeking to establish its first and biggest commodities exchange in the Middle East. Egypt’s Minister of Supply Khaled Hanafy announced Wednesday that his country, represented in officials from the Armed Forces, Cabinet and Arab Contractors Company, will start a number of meetings with CME chairman and board members.

The dollar’s sterling work

Posted on 29 August 2014

A forthcoming paper in the Journal of Development Economics looks at the dollar’s ascendancy to global reserve currency. Barry Eichengreen, of the University of California, Berkeley, and two economists from the ECB up-end the conventional history of when the dollar became top dog.

Bitcoin Grows As New Businesses Start Accepting Currency

Posted on 29 August 2014

Bitcoin, an alternative digital currency which is used to purchase goods and services online, is showing staying power, Reuters reported on Thursday, August 28. Though virtually unknown only a few years ago, the electronic currency is now catching on among more and more online vendors, including Expedia, America’s largest online travel agent, and Overstock, an online retailer.

Chile set to pass Latin America’s second carbon tax

Posted on 29 August 2014

Chile is set to approve a carbon tax next week, making it the second country after Mexico in Latin America to put a price on polluting. The carbon tax will go before the House of Representatives in the first week of September, as part of a broader package of tax reforms. If approved, Chile will start charging US$5 per tonne of CO2 from 2017, around $2 more than in Mexico.

Commodity Prices Inch Down in July: Scotiabank

Posted on 28 August 2014

Scotiabank’s Commodity Price Index edged down by 0.3% month-over-month (m/m) in July, as oil prices lost momentum, partly due to an easing of concern over geopolitical supply risks in Libya and Iraq. “On a more positive note, a cyclical recovery in base metal prices is getting underway, with dramatically higher zinc and nickel prices expected in 2015,” said Patricia Mohr, Scotiabank’s Vice President of Economics and Commodity Market Specialist.

Is the Commodity Data Center Around the Corner?

Posted on 28 August 2014

The data center is changing. We have new methods of cooling, optimizing the data center and even the utilization of green energy through next-generation geothermal technologies. The insides of the data center and what goes into the rack has been changing as well. New platforms around consolidation, server technology and cloud computing are all impacting how we process and utilize resources.

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