July 24, 2007
The sub prime mortgage market continues to head south, the U.S dollar continues its nose dive, the GDP in China continues at its torrid pace all while Canada benefits from rising commodity prices. Little is known about the accelerated pace of mining financings over the past 18 months but something very interesting is going on. Junior mining companies with credible management and resources in the ground are spiking higher in share value while a sense of complacency is overhanging non resource based blue chip equities. The general market has been awakened to the prospects of satisfying China and the Indian sub continent's overwhelming appetite for raw materials. Bay Street analysts have been proven wrong again by their suspicion of a temporary blip in upward metals prices. This bull market appears to have legs.
I anticipate more manufacturers in the U.S to be beaten up by in the short term. Interest rates must rise if the U.S administration intends to appeal to the saturated Asians whom are reaching their fill of U.S dollar denominated U.S debt. The consumer is destined to hit the wall when faced with unmanageable monthly payments. Keep you eyes pealed for the "Plan B" that could potentially become your savior.
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