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Old 10-29-2007, 03:46 PM   #21
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You are looking in the rear-view mirror, RM. And China and India need not buy directly from the US to goose our economy.

A small, tangential example: China used to be a huge exporter of coal. They now import a little, net. At the same time, India and elsewhere are ramping up demand. The pac rim used to get its coal from Australia, Indonesia and China/India. Now they are tapping out Aus and Indo and competing with European buyers for South African coal. In response, European buyers are starting to buy up every ton of Appalachian coal they can get. And Korean and Japanese buyers have been running test loads of coal from the Powder River Basin to the West Coast so they can load the stuff on ships and bring it to their powerplants.

No doubt there are lots of other examples, and more to come with the USD having been bitch-slapped.
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Old 10-29-2007, 03:53 PM   #22
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Good points. I would go further on the depreciation of the dollar. Any country that doesn't peg themselves to it artificially (China) will inevitably see a change in it's consumption of U.S. goods.
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Old 10-29-2007, 04:10 PM   #23
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You are looking in the rear-view mirror, RM. And China and India need not buy directly from the US to goose our economy.

A small, tangential example: China used to be a huge exporter of coal. They now import a little, net. At the same time, India and elsewhere are ramping up demand. The pac rim used to get its coal from Australia, Indonesia and China/India. Now they are tapping out Aus and Indo and competing with European buyers for South African coal. In response, European buyers are starting to buy up every ton of Appalachian coal they can get. And Korean and Japanese buyers have been running test loads of coal from the Powder River Basin to the West Coast so they can load the stuff on ships and bring it to their powerplants.

No doubt there are lots of other examples, and more to come with the USD having been bitch-slapped.
Objects may be larger than they appear but they are not larger than they are. None of the latest coal statistics in the US appear to back up what you are saying, at least to any degree that would offset a recession in the United States caused by a slowdown in housing and automotive industries.

Coal News and Markets (Archive)

Also I do not view a dramatic drop in a currency as favorable to an economy. Indeed, strong economies almost always experience currency gains as China and Canada are doing now. It will be interesting to see the results in the foreign exchange markets if the Fed cuts interest rates a half percentage point tomorrow instead of a 1/4 point.
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Old 10-29-2007, 04:20 PM   #24
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Objects may be larger than they appear but they are not larger than they are. None of the latest coal statistics in the US appear to back up what you are saying, at least to any degree that would offset a recession in the United States caused by a slowdown in housing and automotive industries.

Coal News and Markets (Archive)

Also I do not view a dramatic drop in a currency as favorable to an economy. Indeed, strong economies almost always experience currency gains as China and Canada are doing now. It will be interesting to see the results in the foreign exchange markets if the Fed cuts interest rates a half percentage point tomorrow instead of a 1/4 point.
*Sigh* I will stop trying to teach pigs to sing any day now, I am sure.

Again, you are looking in the rearview mirror. I have the (mis)fortune to follow the coal industry very closely. The US market has been in the crapper for over a year, no doubt. But everywhere else in the world is on fire. Central App coal prices are around $50 right now. Spot coal in South Africa and Australia today hit record prices of over $80 USD a ton. Coal for delivery next year in Europe went over $119/ton USD. You don't think that someone will look to exploit that large a price differential? I do, especially when most Central App miners are thrilled with a per-ton margin of $10 a ton, let alone $30 or $50.

And this story will in all likelihood play out in many, many other industries. Will it be enough to turn the light s back on for the US? I dunno, but between the Fed cuts and export demand, it will be at least a strong offset to the mortgage/credit woes that are rippling through the economy.
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Old 10-29-2007, 04:46 PM   #25
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*Sigh* I will stop trying to teach pigs to sing any day now, I am sure.

Again, you are looking in the rearview mirror. I have the (mis)fortune to follow the coal industry very closely. The US market has been in the crapper for over a year, no doubt. But everywhere else in the world is on fire. Central App coal prices are around $50 right now. Spot coal in South Africa and Australia today hit record prices of over $80 USD a ton. Coal for delivery next year in Europe went over $119/ton USD. You don't think that someone will look to exploit that large a price differential? I do, especially when most Central App miners are thrilled with a per-ton margin of $10 a ton, let alone $30 or $50.

And this story will in all likelihood play out in many, many other industries. Will it be enough to turn the light s back on for the US? I dunno, but between the Fed cuts and export demand, it will be at least a strong offset to the mortgage/credit woes that are rippling through the economy.
.

And how do you propose to get it there? There is for the next 2 years a finite amount of shipping capability. Shipping if you can get a boat for ocean commmodities is now $80-100 per ton. That is why US prices are not going up. I know you know it is almost impossible to get ships for shipment of commodities such as coal and the spot rates on shipping is exploding. That is why the prices in Europe are up, there can be no competition. As the cost per ton to ship to Europe increases the cost per ton in Europe demanded by the coal producers will go up by a like amount as long as there is demand for their product.

The idea that the coal industry could help forstall a recession is illogical to me, and I do not need to be compared to a pig thank you very much.
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Old 10-29-2007, 04:54 PM   #26
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If oil stays near or heads well above 100 a barrel, and we have gasoline near 5 dollars a barrel next spring I would say a better than 80% chance we head into a recession in the summer months. I keep hearing oh the price is not a problem yea right when the people hit a 100 dollars a fillup for 20 gallons there will be a price to pay economically.

Oh and the reason prices spiked again today was about mexico see link

Business and Financial News - New York Times

That oil field is crashing bigtime and it could be a dry area within 2 years!
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Old 10-29-2007, 05:15 PM   #27
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if we have gasoline near 5 dollars a barrel next spring
I know you mis-spoke and meant $5/gal, but still, I had momentary visions of buying a gas guzzling antique muscle car (convertible) from the 50's or 60's and driving around burning up some of that cheap petro.......!

BTW, gas will indeed be going to $5/gal, and higher, in the next several years. Consumption/person must decrease as supplies shrink and the population of oil consumers worldwide grows. And higher prices are the only way to reduce consumption.

It ain't gona be pretty. But the days of cheap natural resources (not just oil), ours for the plucking, are over. Populations continue to grow. Somethings gotta give.......
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Old 10-29-2007, 05:28 PM   #28
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It ain't gona be pretty. But the days of cheap natural resources (not just oil), ours for the plucking, are over. Populations continue to grow. Somethings gotta give.......
Yes; a recession might postpone the adjustment, but there are going to be big changes in daily life here in the US over the next decade or so. We can only pay for so much of this with debt and funny money. So I think we may be buying less of a lot of "discretionary things." Like gasoline.

Ha
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Old 10-29-2007, 05:36 PM   #29
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In the long run expensive gas may not hurt us all that much. It might lead to a boon to the smaller car industry. If one were to buy a car that could get 50 mpg you could afford at no cost the same lifestyle as when you had $2.50 gas and a 25 MPG car. Would become a preference of choosing mileage over acceleeration and size.

However, that would be in the long run, the short run a continuation of this runup in energy and decline in the US dollar will be a big negative and throw Fed plan's for saving the banks with cheap rates to the wind.
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Old 10-29-2007, 08:10 PM   #30
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.

And how do you propose to get it there? There is for the next 2 years a finite amount of shipping capability. Shipping if you can get a boat for ocean commmodities is now $80-100 per ton. That is why US prices are not going up. I know you know it is almost impossible to get ships for shipment of commodities such as coal and the spot rates on shipping is exploding. That is why the prices in Europe are up, there can be no competition. As the cost per ton to ship to Europe increases the cost per ton in Europe demanded by the coal producers will go up by a like amount as long as there is demand for their product.

The idea that the coal industry could help forstall a recession is illogical to me, and I do not need to be compared to a pig thank you very much.
I'm not expecting arias, but could you at least try a few scales?

As I have repeatedly said, I am using the coal industry as an example, not as the great economic engine that will power the economy forward. You must have known that, but for some reason choose to play games. Oink to you, too.

As for the coal industry, freight costs depend on the distance, and Rochards BAy (S Africa) is a lot further from Rotterdam than Norfolk. Domestic coal prices haven't moved much because the customers are mostly US utilities and the US coal industry isn't really set up to export.

And we haven't even talked about met coal. Wooee, is price going up there all over the world.
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Old 10-29-2007, 09:20 PM   #31
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BTW, gas will indeed be going to $5/gal, and higher, in the next several years. Consumption/person must decrease as supplies shrink and the population of oil consumers worldwide grows. And higher prices are the only way to reduce consumption.
Has anyone seen a study comparing the price of oil to the change in the value of the U.S. dollar? I'm aware that the price of gasoline has nowhere near kept up with U.S. inflation, but I wonder if its price is being further inflated by the dropping dollar.

In other words the price of oil isn't going up-- the value of the dollar is going down. No difference to someone at the gas pump but a big difference to GDP.

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I'm not expecting arias, but could you at least try a few scales?
There's no end to this. You're either contending with the proverbial Wall of Worry, or else you're being trolled. You'll be right two-thirds of the time and he'll be right the other half...
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Old 10-29-2007, 09:33 PM   #32
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And we haven't even talked about met coal. Wooee, is price going up there all over the world.
So what do you think -- time for me to get back into FDG?
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Old 10-29-2007, 11:32 PM   #33
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There's no end to this. You're either contending with the proverbial Wall of Worry, or else you're being trolled. You'll be right two-thirds of the time and he'll be right the other half...
Well I'll just go away as I surely do not need the aggravation of posting here but if Brewer is going to claim that the BRICK countries will provide the support to stop a recession and COAL is the example given as a possibility of how it will fostall a recession, I think it is valid to question that logic. To claim it was a type of transaction that in total could in similar ways jump start the US economy is a totally disconnected and illogical arguement. Brewer claimed that people would try to exploit the price differential which I know is impossible from the US. I have reread the posts and I do not see where anything he says other than "I say so and you are a off tune pig looking at a rear-view mirror" that is backing his claim I have never heard elsewhere that the BRICK countries will help pull forward the US from having a recession.

But apparently I am not intellectually gifted enough to understand the finer salient points made so I will have to leave for the http\\singingpigs\arial.com forum to grasp an understanding of the interconnections between the Chinese coal market and other derivative instruments in providing the new lynchpin of the US economy.

Cheers.......
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Old 10-30-2007, 04:42 AM   #34
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There's no end to this. You're either contending with the proverbial Wall of Worry, or else you're being trolled. You'll be right two-thirds of the time and he'll be right the other half...
Not only can he not sing, but he has not even a trace of a sense of humor.
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Old 10-30-2007, 04:44 AM   #35
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So what do you think -- time for me to get back into FDG?
Hard to tell because it has run quite a bit already. The entire coal world is about wtting itself in anticipation of the upcoming contract talks between the producers and buyers for the year startring 4/1 because the miners know they have the buyers by the short hairs and they are prepared to yank petty hard. You'd have to figure out how much of a 30 or 40% increase in met coal prices is baked into FDG's stock.
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Old 10-30-2007, 05:12 PM   #36
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Warren Buffett feels there is a "fairly significant" chance the US is heading for a recession next year as well. I rebalanced early. My international funds had grown to almost 45% of my portfolio due to growth so I sold off half of them and will leave them in MM until early next year.


Warren Buffett Sees "Fairly Significant" Chance U.S. Going Into Recession - Warren Buffett Watch - MSNBC.com
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Old 10-30-2007, 05:28 PM   #37
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Warren Buffett feels there is a "fairly significant" chance the US is heading for a recession next year as well.
Oh, great. Another piglet songwriter. Maybe Brewer can teach him how to sing.
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Old 10-30-2007, 05:37 PM   #38
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R. Kiyosucki's latest summary: "The economy is sinking into a recession ...". case closed
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Old 10-30-2007, 05:43 PM   #39
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That's ok, I just sold all my stocks, gave back my college degree, and bought five rental houses with no money down...
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Old 10-31-2007, 11:00 AM   #40
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That's ok, I just sold all my stocks, gave back my college degree, and bought five rental houses with no money down...
ROTFLMAO
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