Greg's Note: Nothing good lasts forever. That's one of the truest idioms we preach to ourselves, yet when the good times start to fade, we are often shocked and surprised. So when we're going through a period of success and abundance, for some reason we forget how things always seem to even out. We expect the good times to keep on rolling. Resource Trader Alert's Kevin Kerr explains to us that the good times are coming to an end, and American are going to have to deal with their grief. Did you see this coming? And are you prepared to deal with rising costs and less resource abundance? Let us know at greg@whiskeyandgunpowder.com. Whiskey & Gunpowder
The world keeps turning and the resources get used up. It's really quite simple. Despite that fact, the debates rage over Peak Oil, Peak Food and peak everything else. It's about as sensible as rearranging deck chairs on the Titanic. So the "experts" continue to debate whether or not resources are running low. But the evidence is pretty clear, at least to this trader. In the past year, we have seen the oil and agriculture markets explode. And this could be just the beginning of the rally, not the end, as some would have you believe. Personally, I think we are about halfway to the new top for many commodities. That means $200 oil (easily) and gold at $1,500-2,000. The agriculture markets have even further to go, in my opinion. ~~~~~~~~~~~~~Special~~~~~~~~~~~~~ Collect More Than $6,000 If you act right now, you can collect more than $6,000 by simply cancelling your Agora Financial subscriptions. This is a private invitation that is only being shared with Agora Financial subscribers. But if you act quickly, we'll pay you to cancel your subscription. Sound crazy? It won't after you click here… ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Key commodities are becoming more and more scarce. So we can expect to see more suffering in the poorest countries first. Then the economic impact will work its way up the food chain (no pun intended). The facts are fairly grim if we look at them closely. There is going to be less of everything. Yet there will be more people who want those things. Let's face it — wars have been fought over far less. In her famous book, On Death and Dying, Elisabeth Kubler-Ross describes the stages of grief:
In my opinion, the American public is going through the stages of grief right now. Rising prices are just a market-based signal that we are losing our economic and resource abundance. As the American dream fades away, it's like a death in the family. Right now, I think we are between the stages of denial and anger. Ask yourself these questions: What do you think when you pull up to the fuel pump and have to pay $4 for a gallon of regular gas, or nearly $5 for a gallon of diesel? Or how about when you go to the supermarket and have to pay $4 for a gallon of "store brand" milk, or the same price for a loaf of "store brand" bread? Are your emotions between disbelief and anger? Are you saying to yourself, "Hey, what the heck is going on?" (I'm cleaning it up a bit because this is a family-friendly publication.) I think folks mistakenly thought prosperity would go on forever. Dinner is always fun until the waiter brings the check. Or as my colleague Byron King once said, "It's easy to look rich as long as you don't ever pay the bills." No sector has recently hit Americans in the wallet harder than energy. But even with those dramatic price increases, major changes are still not happening. We have seen a very small decrease in gasoline usage - only about 1% or so. But while some travel may be down as costs have gone up, the numbers are not really dramatic. No, I am not pointing fingers. I live here too. If I looked at my own lifestyle, I couldn't say that I am making radical adjustments, either. We still like to drive our big SUVs. We still drive alone to work. Most people rarely take public transportation (if there is any). And we love to run our air conditioners full blast while watching the documentaries on global warming and dying polar bears on our 62-inch plasma TVs. ~~~~~~~~~~~~~Special~~~~~~~~~~~~~ Oil Supply Cannot Keep Up With Demand Just like every nearly every other resource in the country, the oil price is rising and the demand has yet to budge. Oil prices could soon reach $150 per barrel with gas at $6 a gallon. What factors are keeping the supply so low? Click here to find out… ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Yes, we like to grumble when we fill up those big SUVs, mostly because it's easier to complain than make the tough changes that are needed. We feel entitled to keep living as we do. Hey, after all, we've earned it. Right? Rather than make difficult choices, we are in that denial stage and buy the line from the government and media that all is well. The facts and the fiction often get mixed up when discussing the issue of "Peak Everything." Take the surging price of crude oil. Some people (including a lot of politicians) want to blame the traders and speculators. Other people blame farmers and corn-based ethanol. A lot of people blame OPEC. The list of culprits goes on ad infinitum. The fact remains that it's not just one reason or another that we are in this energy disaster; it's actually all of these reasons and others. It's a culmination of many years of poor energy policy, shortsighted planning (if you can even call it planning) and an overdose of arrogance that only superpowers can have. It's like a football team saying, "We're No. 1 and will always be that way." So the team stops training hard. Players quit working out and coming to practice. The coaches just relax and forget about recruiting or developing new talent. Nobody designs new plays or bothers to scout the opponents to see what they are up to. And then the team expects to go out into the world and bring home the trophy every year. "Hey, we deserve it. Right?" Or go back to the analogy of the Titanic. The ship was state-of-the art. It was not "supposed" to be able to sink. But now as the water rushes in and the ship is dropping lower and lower into the sea, the cold water is hitting us all in the face. Now our lawmakers are scrambling to plug the holes, and it's not working. The smart people (or maybe they were just lucky) are already in the lifeboats. Only time will tell if the United States can actually move into the acceptance stage. But in the meantime, commodities will continue to dwindle. Regards, P.S.: While the supply of our resources continue to dwindle, the price for our most precious commodities will be sure to rise. Right now, many traders and speculators are becoming rich during this commodity bull market. So why are so many investors still sitting on the sideline? Don't sit back and watch everyone else get rich when you could be too. Click here to find out how you can play this boom… |
Whiskey & Gunpowder Special Reports New "Backlash" Set to Rocket Oil Past $150...and Send Gas Soaring to Over $6 per Gallon The 10 Shocking Reasons for China's Pollution Problem Geothermal Energy: Investment in the Future Here's One Coal Stock That's Set to Skyrocket Investing in Exchange Traded Funds The Real Story Behind the True Gold Bull Market If someone forwarded you this copy, please look here to start your own subscription. Wanna let us know what you thought of today's issue? Now you can... click on this link. Whiskey & Gunpowder is a free e-mail service brought to you by a team of rebellious brigands. If you have not already done so, please click here to confirm your subscription. This will help us ensure you get every Whiskey & Gunpowder without interruption. Are you having trouble receiving your Whiskey & Gunpowder? You can ensure its arrival in your mailbox here. Please note: we sent this e-mail to lemmetry@gmail.com because you subscribed to this service. To end your Whiskey & Gunpowder e-mail subscription, click here. Nothing in this e-mail should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investment advice.We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of a printed-only publication prior to following an initial recommendation. Any investments recommended in this letter should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company. © 2008 Agora Financial, LLC. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This newsletter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the World Wide Web), in whole or in part, is strictly prohibited without the express written permission of Agora Financial, LLC. 808 Saint Paul Street, Baltimore MD 21202. |
