asiablues's blog

China is decades ahead of the global curve when it comes to understanding the strategic importance of rare earths. But with demand set to double to 225,000 tons by 2015, not accounting for the burgeoning green energy industry, nobody's immune to the coming supply shortfall, including China.

What you have is a contest where you are trying to find the proverbial dog with the least flees on it, and at these levels, I am not sure the euro is the winner in this currency contest.

Despite the recent price surge in crude oil this week--thanks mostly to a Fed's QE2-induced weak dollar, the fact is that crude inventory levels are actually sitting at the highest in 2010. This, plus other market factors coud pressuure crude prices to trade back down around the $75 to $85 range.

The latest dismal GDP data probably will cement an official kick-off of Fed's QE2 on Nov. 3. However, as more quantitative easing could further dilute the value of the dollar, pushing up the commodity prices, the system could be pushed beyond its limit into a possible “demand-pull stagflation” scenario.

Democrats--"sadly enough"--would get a shot at still retaining the majority, which would mean the monetary and fiscal policy will most likely stay on its current course. Meanwhile, the 0.25% interest rate hike effective Oct. 20 by the PBoC is "meaningless," because of skyrocketing property prices, and the cost of living inflation has gone up much more than the official figure.

Some scary developments in Iceland including a 41% inflation in the past three years, 63% of mortgage is underwater, and 40% of homeowners are insolvent make me wonder how far behind is the United States?

Geithner’s strong dollar comments, China's surprise rate hike, and worries about the U.S. mortgage market led a flight by investors into U.S. Treasuries. Some analysts believe that there may be a currency accord right before the G20 meeting. However, from all indications, China and Geithner appear to be acting under totally separate agendas however “coordinated” they might seem.

Due to the abundance of inventory and supply, crude has remained range-bound, and started to decouple and underperformed other commodities, as well as equities. While high stocks level traps crude, the dollar weakness, on the other hand, has prompted some OPEC members to support $100 oil.

It is clear that companies just aren't ramping up hiring fast enough to reduce the unemployment rate, now 9.6 percent. So where will the U.S. find jobs? Contrary to President Obama's belief, an analysis of the Industry Life Cycle and Supply Chain will show that green tech and manufacturing are unlikely the answers to unemployment.

Eric Schmidt, Google CEO, claims that Android is making money and envisions a potential $10 billion market. However, despite the impressive Android number, keep in mind that the free open source means zero revenue for Google. So in order to evaluate if Android will be the next big revenue stream for Google, one needs to get past the initial excitement arising out of the handsets growth projection.

The rush back into commodities after the jobs report indicates that this inflation trade still has some major support and legs by investors.

In an exclusive interview with CNBC on Monday, Oct. 4, Jim Rogers talks about commodities, bond and the currency market.

Last week the shorts were all lined up for another bearish inventory report for Petroleum products from the EIA, but lo and behold, miracles do actually occur.

The U.S. SEC denied the application by China's Dagong credit rating firm of NRSRO status citing concern with cross boarder supervision. Dagong immediately issued an angry rebuff calling the SEC’s decision discriminatory, and that Dagong aims to enter the U.S. market to protect China's interests as the largest creditor there.

As of June 2010, China's netizenship climbed to 420 million, more than the population of the entire United States. Some believe the growth rate of China’s internet users will slow along with its economy. Now, McKinsey Quarterly just released a new forecast this week that Asia’s internet users will reach more than 1.1 billion and $80+ billion by 2015.