04/24/2016 - Forced Inflation (1 Of The 4 Financial Repression Pillars) Ahead: Rising Commodity Prices
Commodity Trader: “The stupid FED and other Central Bankers around the world acting in unison to artificially raise inflation so that they can hopefully get out of the mess they got themselves into with this low/negative rate. Call me crazy, and I am not a ‘conspiracy theorist’ – but what is happening has absolutely no ‘reasonable’ explanation. So I have to think outside the box… The FED and other Central Banks have already destroyed the equity and other macro-financial markets… it is now turn for the commodities markets… How about the fact that the main drag on the inflation figures has been what? What? FOOD & ENERGY… So is it so crazy to think that Central Bankers all got together in early 2016 and came up with the following equation??? ARTIFICIALLY RAISE COMMODITY VALUATIONS = HIGHER ARTIFICIAL INFLATION = CLAMORING FOR RATES TO BE RAISED.”
Dr. Albert Friedberg*: “Value considerations have also moved us to establish a long position in a variety of commodities. The value factor here is the proximity of prices to their marginal cost and the concomitant impact on supplies. Slight changes in demand are likely to bring about relatively sustained increases in prices in at least some commodities. Rather than patiently holding on to a group of commodities, a sort of basket approach, we have asked Covenant to select them on the basis of momentum and have given them authority to raise exposure to about 20% of assets. We are quite confident that their time-tested technical abilities will make an excellent contribution if and when our value proposition plays out.”
