On Aug. 2 MarketBeat had a link "Rich Bernstein says it’s time to sell commodities —
Pragmatic Capitalist" that shows how even high buck strategists can get things wrong:
Few people are more bullish about US equities than Richard Bernstein. The former Merrill Lynch Chief Equity Strategist is taking a fairly contrarian perspective on the global economy when he says that the bigger risks lie in emerging markets and not in the USA. In particular, Bernstein says that commodities are currently a sell due to their correlation with emerging market strength.....
I, of course, had to drop a comment:
7:34 pm August 2, 2011
Climateer wrote:
Bernstein is a sharp cookie but be careful selling ag commodities.
e.g. Corn was limit up today.
Anybody paying attention knew the USDA was doing the resurvey and could guess that yields weren't going to increase. Here's the latest, from the Des Moines Register:
The U.S. Department of Agriculture Thursday stroked the concerns of the grain markets by lowering its projected national corn yield from 158.7 bushels per acre to 153 bushels per acre.
That figure, reflecting poor April planting conditions, flooding on the Mississippi and Missouri Rivers and lately hot weather during pollination in Iowa and Illinois, would be slightly above the 152 bushels per acre corn yield last year but down from 164 bushels produced by farmers nationally in 2009.
The projected 2011 yields and production are likely to be a disappointment to end users such as livestock feeders and ethanol producers, who have counted an production of at last 13 billion bushels of corn this year to ease corn surpluses that are at 15-year lows.
“This means we’ll need extreme rationing in prices for corn in coming months,” said Des Moines commodity trader Don Roose of US Commodities, referring to expected high prices of corn through 2012....MORE
