For Cottonpicken - a thread on the CWB

[chaffmeister]

CP remains unconvinced.

Unfortunately, the CWB is but a seller of grain. It is not a merchandiser. If it were, it could separate pricing and cash dealings/movement. Sell to Indonesia – or anyone else – and replace it with paper if that fit with its long term view of the market. But it can’t. Or won’t.

CP – you’re right. It’s not really about picking tops. But it’s more than market direction, understanding and opportunity. It’s about taking market intelligence and using it day-to-day.
Something Charlie has been talking about forever.

CP - you seem to have missed another question I asked in another thread – so I’ll ask it again.

I know a guy who worked for a multinational company. One year, through some brilliant trading, he made gobs of money for them. But instead of a big bonus, after reviewing/auditing his year, they thanked him for the huge profits and fired him. Seems he took on too much risk for the company’s appetite.

Sincere question, CP: Does that make any sense to you?

[cottonpicken]

Charlie missed the market direction as bad as most here.

A multinational company fires a guy whos making oodles of money for them but they dont like the risk?

Isnt it possible the multinational is wrong?

Its sort of like people who buy bonds.They think its a nice "safe" way to invest.Not even noticing that inflation is eating up more than their return and they are losing money.

Question to you chaff-what do you think the rate of inflation is?

Did i dodge some other obscure question?

[TOM4CWB]

C.P.;

The issue here...in my small mind... is RISK.

Is the risk higher... to price our grain...than to sell it cash?

Long term studies... say it is less risky... to sell the cash on a disciplined program.

Certainly that is the case... in the exceptionally volatile market we have today.

1.7t US Bucks... of Chinese influence... can bounce this market... from here to kingdom come!

And they are NOT going to allow their people to starve with the show piece Olympics shining a huge spotlight on them.

India is not a lot different.

Weather patterns... in Western Canada... have NOT been favourable for much of the CDN prairie.

I have had great Uncles... who in the 1960's made millions... and lost them just as quickly...

History does repeat itself... that is for sure.. how do today's circumstances... change the application of these historical economic and social human activities?

That is a study that will unlock many secrets.... about the future!

But who can predict he weather?

That is the fundamental... that will ultimately drive this market... especially this year!

[agstar77]

Without rain ,early this spring there ,will be some free land on the market.

[chaffmeister]

Response to Cottonpicken:

CP said: "Charlie missed the market direction as bad as most here".

Charlie didn’t miss the market direction, nor did anyone else here on this site. I never read one post that said this market should be shorted. Many said they were pulling the trigger on selling product they had and/or were going to produce, but there’s a huge difference between that and shorting the market.

And you don’t seem to understand that.

You also don’t get that the market intelligence that you’ve gathered is as worthless as tits on a bull if you don’t employ it properly for your own business purposes. From my perspective, most of the guys on this site accept what you've been saying as one more piece of information to be used in determining the best time for them to sell.

For what it’s worth, you’ve chided me for not adding my market view to this site. As you put it, I could “help a lot of people”. Simply put, why would I add more of the same commentary when you were already saying it? Yes, that’s right. I agree with pretty much everything you put on here. What I disagree with is your almost total disregard to the appropriate use the information. In fact you’ve been making the mistake of chiding others for actually acting on this information. And chiding the likes of Charlie (and me) for trying help connect the dots from market intelligence to market action.

CP asks: A multinational company fires a guy whos making oodles of money for them but they dont like the risk? Isnt it possible the multinational is wrong?

The answer is no, they’re not wrong. It’s their money and assets that are at risk – that makes them right. They get to determine the amount of risk they are willing to take – not any individual trader. Companies that don’t manage risk are pretty well all gone now.

Remember that old trading adage? “Risk not thy whole wad.” It’s good advice.


CP said: Its sort of like people who buy bonds.They think its a nice "safe" way to invest.Not even noticing that inflation is eating up more than their return and they are losing money.

It’s not at all like that. Big companies got big by (1) understanding the underlying factors in the market, (2) exploiting their position in the markets, knowing what they know, and (3) managing risk.


CP asked: Question to you chaff-what do you think the rate of inflation is?

Do you want a definition? You know, like “the decrease in purchasing power”.

Or do you want my thoughts on what the rate of inflation is right now? Are you talking core inflation? Inflation as reported by central banks using a CPI (basket of goods concept)? Or something else?

Which country? (Or province?) I assume Canada, but not perfectly clear because I suspect this is not a simple little question, rather a way to test me and my market knowledge – so you can judge me.

Last reports out of the EU have inflation pegged at 3.3% (roughly – again, it depends on the country).
Last thing I saw on the US had it pegged at 3.% (I think) - but this could be old now since I haven’t looked lately.
Last I looked, Canada’s rate of inflation (change in the CPI) was about 2.2%

Is this what you’re looking for? If not, please clarify.


CP asked: Did i dodge some other obscure question?

Nope. I think we're good for now.

[cottonpicken]

Thats what i thought.I was wondering how much you really know.The inflation question was the proof i needed.

[chaffmeister]

If I failed so miserably, please tell us what it was you were asking for. Or what your answer would be.

(Remember, I did ask "Are you talking core inflation? Inflation as reported by central banks using a CPI (basket of goods concept)? <b>Or something else?</b>)

You can't just say I failed - you have to prove it. It's a credibility thing. (not mine - yours.)

[cottonpicken]

Inflation=m3-gdp

If you believe the government numbers i got some real nice beach front arizona property for you.

Now take a guess why the us government stopped reporting m3.

[chaffmeister]

Yup, I guess you got me real good.

I said “decrease in purchasing power”.

I could have said inflation is a rise in the general level of prices over time. (Pretty pedestrian I know, but correct nonetheless.)

Or I could have said the rate of inflation is the percentage rate of change of a price index (Oh yeah – that is what I said.)

I could have just as easily said inflation comes from too much money chasing goods and services. (Does this one sound familiar? It should. Note it says “comes from”.)

Or how about an increase in consumer prices or decrease in purchasing power of money (my original answer), caused by an increase in available currency and credit beyond the proportion of available goods and services (kind of what you were referring to). (This one kind of brings all the others together doesn’t it? Note again – it says “caused by”.)

Basically its cause and effect. When money supply (M3) is increased disproportionately to goods and services (GDP), you get a decline in purchasing power – or an increase in consumer prices. Inflation. Hence my answer.

What I would NOT have given as an answer to your question “what do you think the <b>rate</b> of inflation is?” would be “inflation=M3-GDP”, which actually refers to the <b>cause</b> of inflation, not the rate.

Now if you had asked, “what do you think b>causes</b> inflation?”, we’d be having a different debate.

But you didn’t.

I’m not going to debate whether govt reports are valid or not – that wasn’t the question.


CP ALSO ASKED: Now take a guess why the us government stopped reporting m3.

CHAFF: If you insist. Conspiracy theorists say that the US govt is manipulating the markets to boost (maintain) confidence (at just about any cost) because bad news can’t be handled by the masses. They adhere to the idea that the govt stopped reporting broad money supply estimates so that the public won’t know just how badly they’re manipulating the markets.

Good enough? (I should know better than to ask. Of course you won't think so.)

I know – you won’t like the reference to “conspiracy theorists” but it is a plan that can’t be proven, so by definition it must be a conspiracy theory.




What a waste of time…

[TOM4CWB]

Chaff...

The issues that are frustrating, and annoy folks... the subcurrents that are working below the surface messages main stream media promotes...

These are a huge influence today in investment paterns.

Good to see the bounce back in markets today...