RE: Hobbers fact free storyHi Guys!
I just want to share one bit of info that may shed light on the whole issue. Molybdenum is strictly an over-the-counter market. There are no Moly futures traded in any of the major commodity pits. It trades entirely on the true supply/demand fundamentals.
While all the other base metals were selling off this week, Moly actually rallied from where it was trading just a couple of weeks ago. Moly is mostly used in alloys for heavy machinery as a way to strengthen steel, and also in pipelines. If there was a real slowdown on the horizon for base metals, then I would expect moly demand would also be slowing. It is not.
So I take all of the day to day action for copper, zinc, etc. as mostly noise, as traders scramble from one position to another and try to win an edge in the market. The fact is that above ground inventories are slim, and should remain so. That will drive the market in the long run, and a few hedge funds and futures traders can only make a difference in the short term.
Most of the investors in copper plays seem to be nervous these days, and the producers are down across the board. But I suspect the consumers of copper look at the thin supplies and sweat bullets everyday. I question the complacency of any analysts that are quick to suggest that copper will correct sharply lower as long as we have such limited supplies. And I do not buy the theory for one minute that hedge funds have accumulated physical copper and stored it in warehouses to dump sometime later. That is the biggest crock of sh*t that ever went around the market and I challenge anyone to prove up the existance of even one significant inventory of physical copper owned by a fund anywhere in the world. Paper copper yes, but last time I checked, no one has figured out how to make wiring out of paper copper.
cheers!
COACH247