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| "So what's happening? The commodities smack-down appears to be based on concerns about liquidity, versus any truly fundamental economic news. The demise of OBL has nothing to do with it. It's just that, in a world economy that's driven by the policies of central banks, liquidity is everything and fundamentals are secondary."
Now that pretty well sums it up. The frightening part is that many farmers don't see the forest for the trees and believe that eventually fundamentals will trump the liquidity factor. That is super dangerous to fall victim to that scenario. Farmer's had better not forget to take a cookie or two off the tray as it goes around because the next time it does come around again, the tray might just be empty. The fundamentals have been the driving reason for specs to run these prices up for months on leverage, now the baby seems to be going out the window with the bath water with rising margin requirements.
I respect these situations that unfold much to our chagrin of our pocketbooks. We are not invincible so pulling the plug on some sales is the prudent thing to do when margins are raised when shrinking liquidity factors are at play.
Also, I just read an article referring to the Baltic freights which have never really recovered in freight costs. The article states that there in deed a slowdown happening across the globe. I'll reply to that in saying, the baltic freight index should never ever be a reason for your decision making in sales because the freight costs have come down because of these super panamax ships that are constantly coming on stream that will haul 3-5 x's the volumes as other older boats, thus putting pressure on the ability to raise rates even now that there are fewer ships hauling stuff around the globe. So when pundits refer to that index, it don't mean squat to me anymore.
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Business Insider Commod. Bull Mkt for Years
