The following was posted as a response to that article on the...

The following was posted as a response to that article on the same site. Just to add a bit of balance.



John Tan from Mississauga, Canada writes: Metals just like any commodity and resource are subject to market forces of supply and demand. Price manipulation is only possible if there is a collusion of major producers which appears unlikely as discovery of new mines are always coming on stream. Prices will dictate the rate of influx of new mines which will fall when economics do not justify new inroads. Buyers of metals realize that new supplies like nickel are falling short of demand, hence rising prices reflect the market at play. Their investments are pitched against the short sellers for good reasons as supply fundamentals reveal the folly of the shorts. For the LME to institute lending out of owners' inventory without their prior consent appears like stealing to me at least on the surface of the description of what is happening. If prices of metals were to crash in precipitous fashion as some experts are suggesting, the incentives for miners and investors to open new mines will diminish quickly, supplies will fall, and prices rise, exacerbating an already tight market. The current insatiable demand of emerging countries will in itself guarantee that the present commodity bull has enough steam left for many years. The interplay of longs and shorts is a feature of the markets. Just checking the longs without doing the same to the shorts is inequitable.I do not think you can change the rules for one sector without affecting other sectors of the market. They all operate in tandem with one another.