the reverse crash

One thing for all of you iron ore bulls to think about is that in the midst of a supposed iron ore boom, we have BHP and Rio and FMG trimming back on volumes - essentially a contraction in the physical market for seaborne iron ore - even though prices are high.

Don't just fixate on the price for Fe!

How can you have a boom if (irregardless of price) you are actually selling less physical iron due to lower demand?

Remember, if Fe was traded like base metals, the price would be languishing at 25% of its current level and the volumes would be down.

This is a very peculiar price/volume behaviour for a commodity and it suggests to me that the boom is well and truly over, with the nett result that Australia is probably going to ship less iron this year than before the boom even got going (though only marginally). How's that for a bull market? The price signal seems to have misfired atrociously, leaving us not with a boom but with a perverse reverse crash - being paid more for less.

It's kind of like the dole.

I'm looking for BHP at $18, FMG at $1, Atlas out the window, MGX becoming Mourntu Gibusonu Ironu Oru Shenshen China Inc or whatever, and GBG becoming Jing Jial Bie Ironu. You're better off parking your cash in your mattress, than in FMS.