Monday, July 10, 2006

investment logic 1: wave pattern

Observations:
  • Oil doubled in about two years leading up to last year, and prices are extremely strong
  • The price of oil has affected (impacted for those of you in public scrools) the price of corn.
  • The futures market has corn priced at $2.41/bu for July and $2.935/bu for next July.

Hypothesis:

  • Do cows eat corn?
  • If so, the wave should continue on down the line of commodities.

Actually, cows do eat corn. But when corn gets expensive, they'll just eat something else.

Conclusion:

  • good idea, but no practical application

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