I am seeing construction doubling last year's volume as well. This upturn may be here to stay, thanks for the updates!
There are no unbiased thought on a message board. Even the analyst are biased to who pays them. I would pull up their past earnings and look very carefully at them. For example, look at the amount of DD and A is charged off (this is a non cash charge) and compare it to how much is spent on Cap Ex. If Cap Ex is less than their DD and A charge, they will have extra cash flow, even if they post a loss. Look at their debt and how they are able to service it. In any case, just dissect it and make your own decision.
DRI pellets have been around for a long time, the problem is and always be the transportation cost. DR and pig iron is a viable alternative to service EAF and LG knows it.
I am still here, just buried in work and gone most of the day... should have never retired. Anyway, I read these postings and search some news outlets every night. There just is not any breaking news or PR releases! Nothing out of the CCAA, CLF or steel news. As far as I know, no new labor contract... the list goes on and on.
On the DRI plant, I would not be surprised if a group of small electric furnace steel producers would make an investment into a DRI plant in exchange for a price break on these pellets. This would be the smart way to go because if any one company pulls out it would have a minimum impact on CLF.
But again, this is pure speculation as CLF is playing the same old game of not releasing information.
I don't track the Metal Bulletin's prices since they were a day old. Do they now publish the current price? I see on the DaLian Exchange last night iron ore prices closed slightly up.
Some people on this board have the paid Bloomberg service that gives the current iron ore prices, it would be nice to hear from one of them.
Analyst work for whom ever is paying them. Up to this point, shorts are the ones with the open check book. That is why they should be ignored.
Absolutely not! Even if we went with the gold standard, you still have an increase in money supply with every ounce that is taken out of the ground. Technological advances in mining has allowed us to mine gold at a profit at $10 worth of gold per ton whereas during the Klondike gold rush it was profitable at $90 a ton. Just like gold, money supply must be dynamic.
Sorry about the History Channel, I made a slight mistake, the increase was not 1000%, it was much greater at 1000 times.
And again, I don't have a problem with 5 cent bread as long as wages are adjusted accordingly. If a journeyman mechanic makes $1.50 an hour, keep all the prices low.
And it clear you take the view of the Austrian School of Economics. You should really look at their view of what drives future investment into capital goods. It is basically risk to invest for future gains. Why would anyone invest into the future when they can sell that item for more today and it will be sold for less in the future. Furthermore the Austrian School came to light in the 1930's and Germany's inflation where the wheelbarrow was used to transport useless marks. They had no real concept of the future technological growth we are seeing today.
What a computer sells for has nothing to do with productivity gain, but low cost systems can now be applied across the board. You have computer driven tractors that plow, plant, fertilize and harvest crops to maximize yields and quality. That is an example of the productivity gains we did not see in the 70's.
In 1900, a loaf of bread cost 5 cents. According to the History Channel, since then productivity has grown over 1000 percent. If the money supply was held constant, that same loaf of bread would cost a fraction of a cent. With prices falling like that, there would be no incentive for future investments in productivity, why invest in the future when the prices would be less? Even the champion of free market economics, Von Hyeck realized this.
The other problem, with falling prices and higher productivity, wage rates should fall accordingly. Remember, money is nothing more than a medium of exchange and the baker is really paid in loaves of bread that he produces and trades for other goods and services. So as the price of bread falls, his wages should fall as well. But that is not going to happen and the supply of the medium of exchange must be adjusted accordingly.
You have to ask yourself, with our debt many times greater than it was in the 70's, why are we not seeing the double digit inflation today? The answer is clear, according to Moore's Law, the capacity and speed of the computer chip doubles every 18 months leading to huge gains in productivity. In the 70's there was an energy crisis and we have found all the oil there was, yet today technological gains has greatly increased the supply of oil.
Going back to the 50's, a journeyman mechanic made $1.50 an hour. Today that same job pays $25 an hour, that $1 candy bar really cost you less. It is unreasonable to expect to be paid $25 an hour and still buy a candy bar for a nickel.
Yeah, but the lion's share of the debt is owed to the Federal Reserve, so it is like the government paying the government. Or if the government doesn't pay the Fed, they simply do a journal entry and issue a new bond.
You have to keep in mind that the money supply must increase with the increases in productivity. We must have some level of inflation in order to keep advances in productivity moving forward. Even with the gold standard, you will see increase in the gold supply every year, just look at Todd Hoffman, he went from a couple hundred ounces to 3,000 ounces last year on Gold Rush.
As I see it, it is time to pay down the debt by increasing the money supply to get us back to an inflation level of 4%.
On housing the problem is I have a fica score over 800, 50% down and I can't get a loan to build a spec home. Without the supply, the price of homes will continue to go up and fewer people will be working without a good construction base.