Olympic Metals
The world’s hungriest country suddenly shuts down hundreds of heavy industry factories, and the impact is globally obvious. Unfortunately for the People of China, this isn’t the first, or most obvious effect. The majority of the Labour working within the factories shut down are rural ‘imports’ from the less densely populated areas of the country. These men and women come into the cities to earn the ‘big bucks’ and experience some of China’s ever-changing culture. The Olympics approach, people get excited and the government initiates a $20 Billion dollar clean up plan, which happens to order almost 200 (reported) factory closures, sending everyone home. Three cheers for Pseudo-Capitalist ‘Free’ Communism!
Secondly, metal prices begin to teeter internationally. Market wars and rumours of warehouse revolution stir in the hearts of traders from all continents. Align this with some instability in the U.S. economy, and a general doomsday overcast that’s been preached for the last eight months you have the perfect storm. For only the third or fourth time in the past decade the Chinese buyers let their prices soften, and go on holidays. People start looking out over their inventories and note that they might be running out of storage space. Contracts start getting called in, pressures on past promises begin to apply. But still, there is hope; the Olympics will end, right?
The Olympics closed, and the markets tanked. Simply because of the full warehouses sitting around the world, and the slowness of the Chinese to jump back into the marketplace. For what its worth to any readers out there, the word on the street is January 2009, but keep in mind; Chinese new year beckons. The dreaded Lantern Festival will hit full force January 26th of 2009, and as many of us know, the Chinese don’t like having anything in the water or on the docks during their Lunar Luau.
So, I’ll see you all in spring as the metal prices rise with the tulips and buds gather heavily in the trees. Hopefully then we can continue to bicker over pennies and seek refuge in the knowledge that the ridiculous commodities prices will continue to stretch upward forevermore, or at least until the next major Chinese event.
