Well, with the holiday weekend I found myself twice as busy as a normal weekend. Funny how that works isn't it? I also found myself feeling guilty for not having posted here. It felt like I was letting my few readers down, sorry. That is why I was hesitant to start a blog though, I didn't want another obligation. I have to tell myself that this is just entertainment for you and I, and it's ok to skip it once in awhile if I have nothing to say or no time to say it.
It's ok to miss a post, no one will die. It's ok to miss a post, no one will die. It's ok to miss a post, no one will die.
So the DOW broke 13,000 today. It did so while I was sleeping in and recovering form my long weekend. My response once I noticed was, well, meh. A quick check shows it floated past 13k with vapor think volume meaning to me, it didn't really break 13k so much as drift passed it. As I type this it's at 12,991.16 with a fair chance of crossing 13k again.
So many of the talking heads are trumpeting the great success, the wonderful moment. I smell a trap, but I've been out of the market for the most part since November-ish so I'm not too concerned. I do wish I could give more insight though. Being as I've been sitting on the sidelines for so long I'm just not up to date on the overall market. For my part I'm paying much closer attention to a very few things to see how 2012 is going to go.
1. Of course I'm following the Iran/US standoff with great interest. This is above all else the most important thing going right now. A war with Iran will chew up a lot of US treasure, cost more young people their lives, and run the price of oil up to insane levels... again. Most of you know I believe this standoff has nothing to do with nukes and everything to do with the dollar. We're out to defend dollar hegemony and Iran is the latest to try and dethrone us. If we screw this up... It's just not good is all. I could write a huge post about this issue as well and still not cover everything.
2. The Weather. The last few years have been rough for parts of the Mid West. This has affected everything from corn and wheat to cattle. If the weather starts to turn around I believe we'll see an increase in the price of beef as ranchers start to rebuild herds. Beef prices have been held back as these guys sold off even some of their best cows because they couldn't feed them.
Corn, Wheat, and Hay have all been climbing in price. If the weather stays sour it will only make things worse. This will of course drive up the price of food for everyone putting a further crimp in the overall economy. People are strained to breaking already, add higher food costs and it's going to hurt all sectors as folks make cuts to afford to eat.
This all depends on Iran as well of course. Even if the weather is perfect everywhere in the country but oil spikes, well, you can see how that's a problem. The bigger concern for me is if the Iran situation boils over AND the weather is bad. That leaves us all kinda gimpy.
3. Timberland. I've been watching the price of timberland for awhile now and it's been very interesting to me. While we saw some timberland trading hands through the worst of the depression (yeah, I do believe it was/is a depression. Call me crazy) prices haven't declined too badly. One of the reasons for this is because much of that land is held, free and clear, by some very large companies like Weyerhaeuser and PCL.
PCL holds pure timberland. The company doesn't MAKE anything instead focusing on tree farming. This to me is a pretty good play, holding timberland. It's a lot like farming except you can decide not to harvest a crop in a bad market. Can't do that with corn or beef really. The catch is taxes and the mortgage. No matter what you still have to pay your property tax and the note on the land. If, like PCL, you own the vast majority of your land outright you have a serious cushion in bad times.
Which brings us to why I'm paying so much attention to it. If a company like Plum Creek gets to the point that they need to start selling land to cover costs I'm going to get real nervous. When I start to notice the price of timberland overall declining it's bad.
4. Gold and Silver. The relation of gold to the dollar is a little looser than it used to be but it still gives us a little idea of how the big guys view the economy. It also gives us a gauge on how bad the little guy is getting shafted.
5. The DOW. While the DOW isn't a good gauge of the overall US economy to me, it is a good gauge of dollar strength. When the DOW is going up the dollar is likely going down. If the DOW fires it's way up, I suspect I'm going to see the dollar drop 2 or 3 times as much percentage wise. If the dollar moves first...well I think you get the idea.
So there you have it. My watch list and a quick post to satisfy my need to perform. Now I'm off to feed some cows, work some soil, and get some seeds started.
No comments:
Post a Comment