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That's The Way the Commodity Cookie crumbles!


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Alaron Energies is one of the most comprehensive websites dedicated to energies trading. With up-to-the-minute news, commentary, market pricing and weather information, it stands as an invaluable tool for trading energy contracts. Signup today for your COMPLIMENTARY TRIAL to the site, and you'll receieve complimentary research from Phil Flynn, one of the energy market's leading analysts.

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Gold Prices plunge! Silver melts down! The world runs and hides in an aversion to risk!

Inflation fears have investors fleeing the very markets that historically have acted as a hedge against inflation. Yet the new Ben Bernanke led FED is promising to stop inflation in a single bound. Will the fed and their interest rate increase actually stop the commodity rally? The Fed has raised interest rates time after time yet the commodities have continued to rise. Could this sell-off be the best opportunity to buy futures for some time?

Let's face it the real reason commodity prices have been raising has little to do with what interest rates are lately; growth in China is the key. China, and to some extent India, have been a driving force in commodities. And recent reports show that China and India's demand for commodities is not slowing down. The fed tells us our fate is in the data and let's face it the recent data shows inflation pressure and even some times a little core!

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The China-Driven Fuel Shortage 139 Times Bigger Than Oil...
China's creating a pandemic shortage of this essential fuel so severe that spot prices have already doubled and suppliers are scrambling to get "online." And yet, China's about to increase imports by 1,761% to support the "largest buildout" in the history of energy...

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What is that I see in The Consumer Price Index?! Inflation, rising prices, inflation! Oh my goodness, where are the gouging police! Gougers are springing up everywhere! Gougers here, gougers there and perhaps gougers every where, a disturbing fact showed up in yesterdays Consumer Price index that core consumer prices were rising once again. But equally disturbing is that prices were actually rising. Of course we all know that energy prices have been rising which according to some politicians in Washington is being caused by greedy oil company executives who choose to put profit ahead of the consumers and the economy out of self-interest. But if you look at the breakdown of which prices rose in yesterdays report it seems this penchant for greed is spreading. Perhaps it isn't oil companies that are gouging the public it is other as well. In fact the most disturbing part of the increase in consumer prices came in the core rate, which of course excludes food and energy. The core rate rose because we saw a higher than expected jump in shelter cost which means rent. The gain in rents rose 0.6% and is a big deal because that section of the report accounts for almost one quarter of the Consumer Price Index.

It seems obvious that owners of rental properties have learned this evil practice of raising prices by the immoral and outlandish actions of the big oil companies. It seems many of those who are renting properties raised prices at the same time should prove beyond a shadow of a doubt that there must be some type of collusion going on! Maybe even an evil cabal! How else could we explain this type of rent rising heard mentality.

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Now before I was enlightened by the anti-gouging politicians in Washington I used to try to point out the fact that as we look around at all the other things we bought over the years has actually had gone up more in price more than a barrel of oil and a gallon of gas. The most common comparison is a cup of coffee. (Remember when coffee was a dime?) In fact when I tried to point out that when you adjust for inflation that gas and oil was actually more expensive in the eighties. But I was rebuffed in that argument by the gouging police who said, it does not matter if the price of coffee has gone up, you don't need coffee to survive but you need oil to heat your home. Yet now that the big oil executives have now taught the owners of homes and rental properties to raise prices now the poor consumers might not even have homes. When will the gouging stop? We need congress to call up all the owners of property and then explain this increase in cost. Oh sure they will try to blame it on rising interest rates and rising energy costs but we know the real reason. It is because they are gouging the unsuspecting public! And if Old Mcgouger had a farm it would be here a gouge, there a gouge, everywhere a gouge gouge….

Of Course the energy complex did not only have the CPI to deal with but also the Weekly Department of Energy Report as well. There was no doubt that another big build in gasoline supply was bearish but a surprise draw in the crude supply caught some trader's eye. Some pointed to an increase in refinery runs to the late session rebound in crude. Some pointed to the big surge higher in natural gas. Yet perhaps the rebound had more to do with the market being too oversold on macro economic rate increase worries.

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And maybe the market should be worried about the big economic picture when it comes to energy but perhaps they are worried about the wrong thing. Maybe they should not be focusing so much on rising rates and signs we might seer another demand surge from China. China's Industrial production exploded in May to the highest rate in two years. It seems steps the Chinese have taken to slow demand have not worked. Now perhaps they will be inclined to take more drastic steps but what those are remain to be seen. In the mean time this strong data should have some reporting agencies upwardly revising there demand forecasts.

And if they are raising demand Forecasts for oil perhaps they should be for metals as well. Copper flew back. Gold could follow. In fact the old saying is buy when there is blood on the streets and the commodity blood has been flowing. As the money runs out of futures it's a good opportunity to run back in. The Truth is that for the foreseeable future the demand for commodities is on an upward surge.

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Recieve a COMPLIMENTARY Trial to Alaron Energies and get research from Phil Flynn!

Alaron Energies is one of the most comprehensive websites dedicated to energies trading. With up-to-the-minute news, commentary, market pricing and weather information, it stands as an invaluable tool for trading energy contracts. Signup today for your COMPLIMENTARY TRIAL to the site, and you'll receieve complimentary research from Phil Flynn, one of the energy market's leading analysts.

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About the author


Phil Flynn is Energy Analyst and General Market Analyst with PFGBEST (www.pfgbest.com). Phil is one of the world’s leading energy market analysts, providing individual investors, professional traders and institutions with up-to-the-minute investment and risk management insight into global petroleum, gasoline and energy markets. Phil’s market commentary, fundamental and technical analysis, and long-term forecasts are sought by industry executives, traders and global media.

Because he has been available to media around the clock, even during some of the most turbulent market periods in history, and because he has built a solid reputation for accuracy in his market analysis and forecasts, through thousands of interviews and broadcast appearances for more than a decade, Phil Flynn has become a headline-making name even as he continues to provide expert advice and customer care to his proprietary trading account clients.

Media highlights include: CNN, CNBC, Bloomberg, ABC, CBS with Katie Couric, NBC’s “Today Show” and “Nightly News with Tom Brokaw”, FOX’s “O’Reilly Factor”, PBS’s “The Newshour with Jim Lehrer” and “Nightly Business Report”, MSNBC’s “The News with Brian Williams”, Wall Street Journal Report, The Wall Street Journal, Business Week, Investor’s Business Daily, The New York Times, The Los Angeles Times, Chicago Tribune, Associated Press, The Toronto Globe & Mail, Houston Chronicle, Futures Magazine, National Public Radio’s Marketplace, a chat with the President of the United States, and many more venues.

You can read Phil’s daily market analysis and blogs at www.pfgbest.com.

PFGBEST is among the largest non-clearing U.S. Futures Commission Merchants, with customers, affiliates and brokerage offices in more than 80 countries. The company is a leader in sustainable investing through diversified products including managed funds, futures, forex, options, full-service and discount brokerage, trader education, market research, and direct online futures trading through its BESTDirect™ platform, and numerous other platforms and applications.

Phil’s commitment to and experience in futures trading is documented in two books, The Mind of a Trader (Financial Times/Pitman,1997), and Trading Online (publisher, date), both by Alpesh B. Patel. Phil is a lifelong resident of Illinois. He attended Daley College in Chicago before beginning his career on the trading floor of the Chicago Mercantile Exchange.

Phil Flynn
Phone: 800.935.6487
Email:pflynn@pfgbest.com

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