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Hudson, South Dakota | ..........there is some hope left out here in this THANKSGIVING season.............
This is my concern that ownership is going from funds to commercials. A lot of analysts would have us believing that there is little forward coverage on corn by end users. I tend to not believe this at all. The concern I have is end users being rather well covered which they should considering the profits that can be had at these corn levels. With end users having a lot of forward coverage down here, futures will have a very difficult time rationing any demand because the end user won't care if futures double in price as their paper is locked at six or lower. This means basis will have to do the rationing. This is the exact same scenario we were faced with in 1996 when basis was positive and all time highs were achieved in the futures. I wouldn't be shocked at all to see basis here locally be a buck over the board regardless of the board price in the next eight months.
It appears to me that we're sitting on a ticking time bomb with regards to corn. I wouldn't be shocked at all to see a parabolic move much like in 1996. I tend to believe this will paint the gov't into a rather tight corner. All we need now to light the fuse is exactly what happened back in 1996: China to come in with the great grain robbery they had back then
http://community.agriculture.com/t5/Marketing/Floor-Talk-November-2...
And from MT............
couple of interesting things to chew on..........first is this game of chicken that is happening in the EU with the ECB, IMF, blah blah blah whatever.........it appears that its a stalemate or chicken.......but is the stalemate between countries in the EU.......or a stalemate between the EU and the US???????? QE3 anyone, QE3 Euro style??????
also VIX has been impressively soft the last several trading days.........typically news and moves like we have seen and headline risk that is, protection would be at a premium by now..........NOPE.........which means there is a TONNNNNNNNNNN of cash setting on the side lines...........A TON..........no need for protection if its in cold hard cash..........
its always darkest before dawn............
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http://community.agriculture.com/t5/Marketing/QE3-but-and-the-VIX/t...
Just some words of hope as we pause to give thanks to the one who provides to you and yours HAPPY THANKSGIVING................DOUG | |
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For the BEARS and BULLS in hiding........
