b/s sp cycle, page-7

Those who think that the problem with the low SP has something to do with shorters, instos driving the price down, HFT's out of control need to take reality check!

At these low prices for Iron Ore; according to the companies own reports they are not making any money!

You are asking people to invest in a company which if the majority of analyst are correct {re: the future Iron Ore price} they will most likely at best struggle to survive!

If you have long term belief in the strength of the IO price as I do, then AGO is a good bet at these prices!

Short term trading, no body who reads this thread should be surprised at where the SP is at the moment!
I have been posting about this current IO price collapse for about two weeks now.

Starting with this article:

From the Dalian Commodities Exchange Web site:


China Tightens Financing for Iron Ore, Released Inventories Likely to Cause Price Collapse

Apr 17, 2014


"The Chinese government’s moves in suppressing the bulk commodities-based financing behaviors are likely to make tens of millions of tons of iron ore dormant in domestic ports flood into the market suddenly, thus leading to a new wave of iron ore price plunge.

Analysts and traders warned that if the weak demand for iron and steel pushes down the iron ore price and prompts the banks to shrink the loans with the iron ore as collateral, the investors financing on the iron ore without hedging may be at risk.

Chinese government’ moves in tightening the credit have caused the buyers to break the contracts of soybean import worth US$ 300 million in recent weeks, and the worries that the copper financing agreements may no longer work helped to push the copper price down to a 3.5-year low in March.

With the steel prices diving, the iron ore price used to tumble by 8% in one day to hit a 17-month low in March; although the price has picked up ever since, the fragile outlook for China's consumption of steel as well as the huge iron ore inventories at ports means that the price is likely to suffer another round of significant frustration.

Last week, China's iron ore stocks at ports reached over 108 million tons, close to the record highs, which is enough to build nearly 1,200 New York Empire State Buildings."


I also said in one of my post before the SP pull back,
"Run for the Hills!".


No body on here produced even one alternate scenario re: the above.



Is it really necessary to whine and complain about the SP when most on here must have known what was about to happen?

Everything depends on how low the IO price goes, all things considered it will continue to fall over the next week. I suspect we will get a turn around in the low seventies if the Chinese Port inventories have started to reduce!


Disclosure: Short sell