Thursday, June 25, 2009

"Buy Zinc" (Not Really)

From an April '08 post, "Buy Tin":
That was the cryptic message from a reformed metals trader this afternoon. No rationale, no investment thesis, just "buy tin".

I couldn't help thinking of the Barney Miller episode "Child Stealers".
Time traveler "Adam Boyer" comes back from 2057 and is hounded by Harris for stock tips:
[Harris, acting on a tip from a "twinkie" claiming to be a Sociology Professor from Columbia University who's traveled back in time from the year 2057 (played by the great character actor Richard Libertini), calls his broker to transfer his assets from gold bullion to the financial standard of the future--Zinc!!]:

", no blue chips, either...I was thinking about Zinc! (pause) Yeah, Zinc! What's it goin for these days? (writing the figure on a notepad)...Thirty seven and a half cents---a POUND?? (The "Professor" gives Harris an encouraging nod)...Yeah, well, I might be willin' to spring for a coupla TONS!
Today, Money Morning Australia's headline is "Look for Zinc to Bounce":
...The breakout in April of an oblique resistance level gave some momentum to the price action after a period of consolidation. This oblique resistance cleared is actually the slope that goes through lower high points posted since the historical high of November 2006 (point A on the chart).

As expected, the price action reached the following resistance level identified around $1,630. This level corresponds to the previous low posted in last August. The price action peaked even higher, at $1,672.5 on June 12. Two weeks later, a correction has driven the price to $1,508 (10% lower)....MORE

With the exception of copper I have not been following the base metals preferring instead the relative tranquility of the lard/grease/tallow complex*.

Any losses suffered as a result of this post should be blamed on Adam Boyer and/or Money Morning Australia.

*See "Volatility Getting You Down, Bunky?":

Maybe it's time you looked into the tallow market.
The tallow/grease/lard complex has been traded for five thousand years:

2992 B.C.
Honey I'm home!
Hi dear, anything new in tallow?
Nope. Same ol', same ol'.

2008 A.D.

Here's a long term forecast for tallow:

Figure 1: Tallow and Crude Oil Prices: New Zealand Dollars per Litre...