COMMODOTIES --- BOOM OR BUBBLE ?

[whiteheron]

That is the question
There seems to be two schools if thought

One that we are in for a prolonged period of high commodoty prices ( industrialisation of China / India , increasing demand / reducing stocks , difficulty in finding / bringing on stream new supplies etc etc etc )

Another that the current boom is just a part of the periodical boom / bust commodities cycle ( currently being at the top of the cycle )

I have a great interest in what the true position is as I am heavily invested in Australian commodity stocks (mining and resource )

My opinion is that we are part way through a major commodities boom that is likely to last for a decade or more , obviously with some volitility on the way , but no major bust period/s

Your comments will be most appreciated

As always , time will tell , but I am confident of a major bull run

[Halebop]

I favour the longer term strength of commodities (10 years +) based on growth from China and to lesser extents India, Asia and Latin America.

This won't reduce the volatility of commodities though and share price appreciation will only exaggerate the inevitable short term dips. Additionally, China is still a command economy and can chose to make "freaky" decisions to the detriment of markets.

I can't see their growing economies having different results to the similar growth cycles of say Japan in the 40s through to the 80s or America's various growth spurts before then (they did follow a more defined boom and bust cycle numerous times but didn't have various banking and stability safe-guards either).

Interesting to watch whichever way the cards fall.