I really don't understand why markets are so focused on Europe at the moment. It's all a big con. Did you know that the U.S. doesn't depend on Europe for trade and that it is fact the other way round. The U.S. imports 10% more than it sells to Europe, but nevertheless US imports of Euro goods have been steadily rising since 2008.
The only problem I see is slower manufacturing and a rise in bad loans from 300 billion to 600 billion or so internally in China itself. But they have 3 trillion in policy ammunition to respond to these challenges, which bodes well for future commodity prices as they ease monetary policy.
JP Morgan (had a sell on commods since May) and Goldman Sachs just put out a buy.
Goldman Sachs said in a report Dec. 1 that the world is likely to avoid a recession and maintained its "overweight" allocation to commodities, predicting a 15 percent return in the next 12 months. That is still the bank's view, Sophie Bullock, a London-based spokeswoman for Goldman, said in an e-mail response to questions on Dec. 15.
"We are cautiously positive on commodities, and that view hasn't changed," said Sudakshina Unnikrishnan, an analyst at Barclays Capital in London. A close balance between supply and demand across raw materials "could drive a strong price rebound in early 2012," the bank said in a report this month.
All that matters to me is what the people with the money and power to trade against you are going to do...
KZL Price at posting:
28.5¢ Sentiment: Buy Disclosure: Held
