Katusa, page-20

Morning Guys,

Thanks for the Cu inventory chart. I hadn't looked at that in a while.

In an interview on RealVision, some months ago now, Simon Hunt who is an expert in China and Cu demand/ supply forecast this weakness in Cu prices (and other base metals).

From his network of contacts throughout China, he surmised that China was cracking down on its shadow banking system in an effort to purge the financial system of excessive leverage well ahead of a major Communist Party anniversary in a few years. The aim being, that they want their economy humming at that point in time.

Cu is used as collateral in a lot of debt transactions in China and thus, when the debt is unwound, the Cu is sold. This, in part, could be the reason why there has been such a steady decline in Cu inventory:



Simon also stated a very positive LT view for Cu from a Chinese centric perspective due to the fact that what we have seen so far in terms of infrastructure build out has only incorporated 21% of the Chinese population resident in Tier 1 cities. The next phase of Chinese policy is to incorporate development for the remaining 79% of the population.

And then there is India, et al and as per Goehring and Rosenberg's research:

http://gorozen.com/

... they are about to enter their acceleration phase in the "S-curve" of their development.

An investment in MOD/ MTR is currently very frustrating and somewhat boring for a "junior" but as per Jesse Livermore, it is the "sitting" (patience) that will, IMO, fully reward investors here.

Cheers
John