I got to sit down with Maria B on Closing Bell to discuss the Saudi’s blaming speculator’s…Be serious!

And here I am on Larry Kudlow from Vegas, I called the time to sell oil, at least short term. I own 100 puts right now, I always put my money where my mouth is. Look at the bottom of the screen where oil was when i suggested it, now look at it today.

Ok I am off to Vancouver and the Agora Conference…Be sure to check back here daily for video, photos and comments from the event….Travel safe if you are coming and see you there.

Well as our Fed leaders gather today and Wednesday we will get the play by play from the media, yawn.

Here’s my prediction: The Fed move is likely to have a strong statement on inflation and the concern for the dollar, but no rate increase. Truly, even if they voted for a “radical” .25 increase to shock the market, what are we really talking about. Nothing! Now, I am no economist, I am a trader. So I am the first to admit that my understanding of what is best for the economy may be a bit skewed.

Let’s face it, the job market is softening, business is scared of who will man the White House come next year and consumer confidence is on a cliff. Meanwhile, inflation is soaring, more mortgage resets are coming down the pike and heating oil prices this Winter are going to be obscene. Oh yeah, flooding in the Midwest will cause almost all categories of food to soar, corn is only the tip of the iceberg. Everything from cherries and dairy in Wisconsin to Cattle and soybeans in other Midwest states.

The meat market will also be decimated as feed costs become out of reach for most feedlots. Enjoy that $50 steak at Ruth Chris, it will cost you $100 next year.

I have followed the meat markets for many years and in all that time I have never experienced a better time to buy futures, cautiously. I wrote an article a few years back that seems like i could have written it yesterday. Here is an excerpt and you can click on the link if you want to view the entire story.

(Excerpt Below)

Few markets conjure up as many images from investors as the meat futures markets do. Some people will think of Old West cattle auctions, with cowboys and ranchers bidding on prized bulls. Others know the meat markets are just like any other market, though they still hold on to the notion that it’s exotic and full of risk.

And that’s just bull. (Sorry, couldn’t resist.)

Certainly meats are risky, the same as any market. But they’re also a vital market filled with many opportunities for your portfolio. Of course, you’re not likely to hear about them from your broker. The sad fact is, most analysts on Wall Street only know cattle as it’s served up to them at a Morton’s or Ruth’s Chris Steak House.

Essentially, meats are traded on Chicago Mercantile Exchange. And as I said, all trading is done much the same as any other commodity.

Of course, like all markets, meats have a very unique language. Traders concentrate on data that nobody else looks at.

Full Story Here>>

http://www.silverbearcafe.com/private/meatmarket.html

—————————————————

So all we can do is wait and see how the markets react. Gold is firmer today as the dollar declines and the Euro finds some footing. Gold was only down about $15 yesterday, which these days is a normal range. Hell, when i started in the business in 1989 a $20 move in gold and $5-10 move in oil would have been unheard of. Crude is surging up $1.60 as I write this morning and it is likely on its way to $150 at this rate.

Let’s see dollar lower, oil higher….hmmmm Makes sense to me. Just like i said on CNBC yesterday , see video in yesterdays post below.

One last note, I bought a $100 crude put yesterday for around $500, I figured it is a good hedge and it gives me until September. By the way, I am still long cocoa and sugar, cocoa may be time to grab profits though, no reason to be greedy.

Next week is my birthday (41, ugh) so it will be an early B-day present. The it’s off to Vegas for FreedomFest 2008!

http://www.freedomfest.com/

—————Viva Las Vegas!

Hey, if you are anywhere near Vegas you must come by the conference or heck swing by the Bellagio and maybe we will meet in the lobby, who knows. Or if you can’t make the conference I am trying to set up a book signing off site of the conference too and will keep you posted.

Ok, check back later today as I am doing a mega RTA Mailbag right here on the blog, I have gotten tons of email so we can only answer a few in any issue and the rest I will do here, be sure to check back today and tomorrow!

First! Here is a new Resource Trader Rewind video. This is from January 2nd 2007. You be the judge who was right. Past performance is no guarantee of future profits….But it’s a damn good start

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The flood of 2008. Our thoughts and prayers go out to all those impacted by the terrible flooding in the Midwest. Corn, soybeans and wheat prices are all surging as 2008 is turning out to be a disaster for crops. Well it was a media frenzy this week as it seemed everyone wants to talk about the pending food crisis and of course the surge in oil prices. Below is my appearance on CNN Issue #1 on Wednesday.

I stopped by and spoke with my friend Larry Kudlow of Kudlow & CO. last Tuesday night.

I also went to the NASDAQ and talked to our neighbors to the North up at BNN and also to Barron’s and the WSJ.

Check out my interview with BNN here. If I look hot (I mean sweaty) I am. It was close to 100 degrees in NY Tuesday and under the hot lights of the tiny studio at the Nasdaq, i felt like one of those chickens you see in the grocery store under the lights in the Deli section.

http://watch.bnn.ca/tuesday/clip58926#clip58926

Then I walked down the hall and talked with my friends at Marketwatch, Barron’s and the WSJ

And lastly here is my interview with CNBC Arabiya (re-edit) Fun to watch but you will only understand it if you speak Arabic.

And this note just rolled in form my friends at www.Jurojinweekly.com
THE COMMODITY BONANZA ROLLS ON

Trading opportunities have proven plentiful and lucrative in 2008 for global traders, and none more impressive than the last 7 trading days. As flooding has saturated the Midwest recently, our long corn, long soybean, and long wheat positions spiked higher lifting our take profit orders all the way up.

A third party that brokers business for some of our Jurojin subscribers called in this morning. He reported gains for the week of $16,475 for every contract his clients traded (before commissions). We appreciate the communication and are happy to see our loyal followers getting a piece of the pie.

============================
$16,475 gain per contract in 8 days
============================

Here is a look back at some of those trades:

On June 3 we told our subscribers we liked wheat futures. Wheat had just traded off a bottom and drought in Australia was looking like it could be worse than ever. Rainfall in May was the lowest on record. This combined with excessive rains in the US to create a one two punch on supply-the result a $2,950 gain as our first profit level was hit.

===============================
Find out what the traders
of Jurojin
are looking at next — Jurojin Weekly.
================================

Also on June 3, we recommended a long corn position buying strength as corn continued its trend higher on surging demand- however, supply was the catalyst. Our research suggested that crop planting was weeks behind schedule across much of the US Corn Belt and a wet spring had stunted the normal farming cycle. Though we couldn’t have forecasted the disastrous weather of last weekend, when relentless rains rolled in-the price of corn futures spiked to record highs, running through our take profit orders and landing subscribers $7,625 on the trade.

Then on June 10, in light of the horrific flooding in the Midwest, we added a grain play to the portfolio, going long soy meal. The trade rose sharply from the moment we entered as speculation on crop destruction and transportation delays began to unfold. We hit profit targets in a matter of 24 hours cashing in on another $2,900. We also got in on soybean futures, riding the rally in the agricultural complex, and pulled in another $3,000 since Tuesday.
======================================
“A Hedge on Rocketing Food and Energy Costs”
======================================

While consumers are being socked by higher food and energy prices, our subscribers are finding relief and income participating in record prices. (Learn More)

HOW HIGH CAN COMMODITIES GO?

The benchmark CRB commodity index is up 44% over the last twelve months. The biggest twelve month increase since the period of 1973-74. The same period that included the most severe recession since WWI and the Oil Crisis of 1973. For reference, since 1913, the CRB index has averaged a 2.88% increase on an annualized basis. Many unique factors are driving commodities, but timing the commodities trade is critical, and one that must be managed with an ear to the ground.

Ok so here we are at the official start of summer in the US,hope you’re enjoying your holiday weekend. I for one plan to grill and catch up on a couple of books.

I am currently reading “The Importance of Living” which was suggested to me by Dr. Mark Skousen who is on Kudlow & Co. with me once in awhile and he also invited me to speak at his conference in Las Vegas this July “Freedom Fest”.

Ok so all this weekend keep checking back to the blog as I will be answering many questions from my RTA and OI subscribers. I get hundreds of great email questions a week and we often can’t answer even 1/10th of those.

SO look for more answers to more questions here each week from now on. Also, I always post some of my recent appearances on TV so scroll down to the last few days and you can see me on CNN, BNN, Fox and my interview with the Wall Street Journal. Enjoy!

By the way, have you picked up your FREE copy of my 2008 Agriculture Trading report? You can get your copy on the front page of our website. Enjoy

Now let’s get to some of those questions. I am in my hammock with a cool drink watching my 16 month old daughter run around the yard.

I do some of my best trading and thinking right here in the summer.

So let’s jump in to my readers questions.

Reader Mail from around the World….

Q.

Hi Kevin,
Thank you for your answer to my question earlier this week.
I sold the spread for 39 cents (I only had one contract) but now I’m cashed up and ready to have my money work some more. That is one thing that I’ve not seen money management folk address … one of the advantages of options, like you’ve said, is knowing exactly, up front, what your losses could be, and therefore … (sez me) there is no reason not to be 100% invested and have ALL your money working for you (as long as you don’t put it all on one play … red 17!?!)
BTW you have more than doubled my account, and we’re not through the year yet! Granted, the pockets were not that deep before (oh and they also had dust and spiders due to lack of activity). But the pockets are deeper now !! (and clean)
Thank you,
Lu

A.

Well most of all I am glad to hear you are doing well and keep your head down and 2008 could really be great for you. I like starting new traders with options just for that reason, limited risk and a little bit slower movement then futures. One step at a time, slow and steady wins the race. Best, Kevin
——————–

Q.

In six months I have increased my trading account by about 50%. Thanks for all your guidance and discipline in trading…Mike

A.

Congratulations! Expect some losses this year too though, hopefully more wins than losses but always protect equity. Take some of those profits and set them aside, always use risk management, that’s smart trading. Good Luck, KK

——————–

Q.

Hi Kevin,

I am new member of RTA . I have not placed any trades till date.(account just got ready)
Please advice if there are some good entries that I can make now ( from the previous Alerts that you have given , and still valid) , so that I can call up my broker and say ” Please place this order “

Thanking you,
Sam

A.

Well I still like all of our trades except maybe sugar. I think OJ is a sleeper, even thoguh the options are way down and the market has been very weak. The only thing that worries me is the shrinking volume of the exchange, mainly due to ICE taking over and basically destroying the exchange. Very unfortunate. We will have many more new trades soon too. Good luck. Kevin

——————–

Q.

Hi Kevin.

I appreciate your explanation of a bull spread in your mailbag but I still have a question… I understand the premium received when you sell the higher priced call is supposed to help reduce the cost of the lower priced call. However, doesn’t the value of the higher call go up alongside the lower call? If so, doesn’t its premium rise as well? What confuses me is that if, when you buy it back, the premium is higher than it was when you sold it, how is this really reducing cost? Or are you supposed to let the higher call expire worthless? I am still confused about the exit side of these spreads. Thanks and take care! CZ

A.

Spreads do have maximum profit due to that, that’s why many people don’t like them, they also have twice the brokerage, so brokers love them. Typically the lower strike will appreciate much faster and the maximum for the buyer comes at expiration, rarely would we hold a spread that long, we would instead take profits much earlier. Take care, KK

———————

Q.

Only had 1 contract so decided to take it. Got filled at 35.75 for 81% Figured 81% is a good profit for a few months. Can’t go wrong there!

Bob

A.

81% in a few months, let me check….Yes, yes that is a good profit….lol Tell me where else you can make 81% in a few months, congrats! KK

——————–

Q.

Hi Kevin,

Your advice is excellent and your service is great, thank you.

However, I guess I must be rather thick headed. I will not trade spreads in future because they are too difficult for me to enter electronically and TradeStation representatives don’t seem to understand what you are asking them to do when I read them your instructions.

Kind Regards,

Jim

A.

TradeStation is good but I highly suggest getting a broker you can talk to on the phone in order to place these trades. Look, you can trade both online (to save money and for ease) but also have a real live person to talk to. Very important. Good Luck and thanks for writing. Kevin
——————-

Q.

Filled the corn spread at 35.6 points. Filled the soybean spread at 39 points. Thanks for two great trades.
Ron

A.

You’re welcome and enjoy the profits, hopefully we will take even more on the second half of those trades, always good to lock in profits though. KK

——————-

Q.

Wondering if you can explain why sugar might follow oil down (if it ever corrects) when it hasn’t followed it up. Also, if the trade looks like it might not have enough time, is it not better for new subscribers to pass on adding to this position, or perhaps purchase an option farther out?
thanks

A.

Well 5 years ago if you had told me sugar would be tracking crude at all I would have been amazed. Truth be told is that we need to see a lifting of the tax on imported sugar based ethanol, that will be the catalyst, all the best, Kevin

——————

Q.

Good Morning Kevin.
Regarding the Soybean oil 65/70 dec call spread. I got in at 150.

Please explain something for me because you have me confused. Your alert for the 65/70 spread (BOZ8) referred to it as the Dec08 calls. Your briefing note on May 19th says that its the Nov 65/70 spread. When you send out the alert to sell I’ll be looking for the Dec spread not the Nov spread . Did I pick up the wrong spread .

Sincerely

Pell

A.

That was a typo and a mistake on my part, I apologize. It’s a good lesson though. Mistakes are easy to make especially when trading similar contracts. In this case though soybeans trade November and soybean oil trades December, not vice-versa. KK

Q.

Kevin;

Brief note on planting. I live 30 miles outside of Indianapolis in Anderson. My wife and I were out in the farmland twice this past weekend in different areas. It appeared to me that about 20% of the fields were still not planted and we are at the end of May. I been in the real estate busines for 42 years and I am very familiar with farm ground. Thought this might be interest.

Kendall

A.

Thanks for the update, keep em coming all season if you can. Best, Kevin

——————-

Q.

Dear Kevin,
I am new to RTA. Where can I get quotes so that I can follow prices
for commodities and options?
Regards,
Sheldon

A.

I use e-signal but many of the exchanges now offer quotes too. Depending on who your brokerage account is with they may offere them to you for free or for a discount, I would ask. It really depends if you want LIVE quotes or slightly delayed. For RTA purposes it’s not as important ot have 100% live quotes since we are trading options not futures. It will save you a lot of money or even be free if they are delayed. I would first check with your broker or one of thebrokers on our suggested list, you can find them at the link at the bottom of yesterdays update. Good Luck

——————

Q.

Kevin,

Can you possibly explain this when you get a chance? What does order busted mean? Are the floor traders playing games?

Thanks,

Jerry

A.

Well I’m not sure, you would have ask them. Busted can refer to a lot of things but it usually means there was something wrong with the order itself, (ie. Bad Price, month, etc.)
I would have them explain to you exactly what happened with this particular trade, if they can’t or won’t then find another broker immediately. best, Kevin

—————–

And our last one for today, but be sure to check back all through the weekend for more email and my outlook for the coming trading week.

Q.

Kevin,

Sorry to bother again! But wondering if you can comment on the following in your next mailbag. It is from a newsletter I subscribe to, written by a very respected market analyst (Bert Dohmen, The Wellington Letter):

“When central banks try to prevent recessions, it leads to higher and higher prices … Speculation in order to ‘beat inflation’ heats up. We are seeing this now, with hundreds of billions of dollars flowing into commodity investments …

All this money going into the commodity funds produces an artificial price boost for these. We are seeing inflation through speculation. When the bubble bursts, it will go down fast and furiously ….”

(I think he’s referring mainly to oil, coal and grains, since the same author is extremely bullish over the next 2-3 years on gold)

thanks, Mark

A,

Yes, funny enough I was just on TV with Burt the other day on Fox Biz with Stuart Varney…I will post a link here in a bit for that interview. The question isn’t whether many commodities will eventually correct, it’s when. Having said that, to jump on the short side of these markets right now expecting some huge plunge, well I wouldn’t suggest it. Look for the video here later.

Ok well that’s all the time I haver today, my lemonade is gone. Be sure to check back over the weekend for more answers to more questions. Enjoy the holiday.

A Brave New World

As you approach Dubai by freeway you traverse vast desert and scorching hot sun. Many Mosques line the sides of the road, as well as numerous housing projects that seem to go on forever.

Then suddenly in what seems to be a haze or fog a shadow, a tall shadow appears. It’s the burj Dubai.

When completed it will be the tallest building in the world, by far. The question is for how long, other big projects are planned. Yikes, are there any cranes left, any steel, any cement, any brains?

In the meantime, that’s a lot of office space to rent out. But then again Dubai plans to have an astonishing 180,000 hotel rooms by 2015. 141,000 just in the next seven years. Currently there are a mere 60,000 hotel rooms available.That is the blaring headline on the front page of the Gulf News Daily Business section.

Anyway, the burj is huge, but Just how tall the tower will be remains to be seen.

As with any skyscraper, there is a certain amount of “fudge room” where the actual height of the construction may not be exactly what was anticipated. With a project as massive as this, more flexibility is called for in the design, planning, and execution. At this time, the tower is expected to be 2,683 feet tall (818 meters).

However, those numbers have changed in the past and are likely to change again. There are estimates that it could go as high as 3,116 feet (950 meters) when all is said and done. It is also unclear how many stories will be in this tower. Early estimates were around 200, but those have been lowered to 189 as construction progresses.

Anyway as we continued on to my hotel, the Fairmont Dubai, I noticed the new monorail/train Dubai is building. In fact the elevated train runs along the freeway almost the whole way as you enter Dubai. I could see the workers on top of the pylons and trestles, seemingly without any harnesses or safety equipment several stories in the air.

Surely, if the fall doesn’t kill you the cars going 85 mph below most certainly will. Suddenly my job doesn’t seem so bad. Throw in the 120 degree heat and 15 hour day and well I think you have the job from hell.

Aussie Joel, my mate from Agora and his girlfriend were telling me at dinner the other night, that these guys, mostly Indian and Malay’s, work in these conditions in July when the heat is even more intense. Worse still, during Ramadan they cannot even drink water due to the fasting requirement.

That means from Sept 1st-September 30th certain things are off limits, refer to chart above.
Now I am not criticizing or judging anyones religion, not at all. I just am saying I can’t imagine working in those conditions, especially in that heat, and no water. Joel said that at least one a week keels over or slips and falls into traffic, it’s just part of it. Nice!

Anyway, nobody fell on my car so we drove onto the Fairmont and pulled up to the front of the hotel. Below you can see the Fairmont in the lower right corner.

Now want to get a real sense of the growth rate here in Dubailand. Here is the same stretch of road only a few years ago. It’s simply incredible.

Now I’m sure like me you may have seen these before and after pictures somewhere else, but let me tell you until you see it up close it’s really hard to grasp.

Anyway, I checked in to the Fairmont, always a fantastic hotel. In fact that is the hotel chain the Agora Investment Symposium is held each July in Vancouver. I hope you can come join us this year. I will put a link on here soon.

Anyway. I settled into my room and figured out all the things I wanted to see. First I rang Joel and we planned for dinner out by the Palm Islands, but first I had to run to CNBC Arabia to do an interview.

Again, it beats working on a three story pylon above a freeway, it’s still work. More from Dubai in my third installment tonight right here.

Also I will post my appearance on CNBC Friday on Kudlow & Co. I was noticeably jet lagged but still able to get in a few punches…lol Check back this afternoon.

By the way happy Mothers Day. Alexandra and I took Mom to the Brooklyn Botanical Garden, she loves to take photos so we knew she would like it. We both love her very much, because of course she is the best mom in the world.

Enjoy the day with your MOM!

Well April showers bring May flowers but April flurries just bring worries, that’s what I say anyway. I have to apologize for not getting a follow up issue to you last week but having just returned from my farm tour and then turning around almost immediately and heading to Baltimore for our editorial meeting left me little time to sit down and really give you a fair look at the situations I see brewing.

Let me first say a big thank you to all the farmers I met with on my latest trip, especially all the farmers who took the time to sit down with Charlie Nedoss and I in Waseca Minnesota. Heck maybe they were just there because it was to muddy to get the tractors rolling anyway, lol. Nah, the meeting was only supposed to be about an hour and it went over two hours so I think it was just as interesting for them as it was insightful for us.

My good friend Geb Singlestad and his son Scott arranged the meeting and I am very grateful for it. Scott took plenty of time to show us around his farm again and Geb took us out to see the 110 million gallon ethanol plant in Janesville. I can’t thank them both enough and I wish them a good growing season. As Charlie and I drove down form Minneapolis last weekend though we saw just how poor planting conditions are.

Mission Critical

The fields were wet and cold with standing water in many and not one tractor rolling as far as the eye could see. The forecast last weekend was for some drier weather heading into last week, it was short lived. Now my calendar says April 28th but even so a blizzard and frosty temperatures hit much of Minnesota and Wisconsin, flurries are expected in Chicago today. Now I heard a few reports that seeders were rolling in Indiana but I think that is the exception and not the rule. Time is running out for farmers and some may be even trying to plant in the mud, not a good idea. ‘Mudding it in” is what it’s called and it can bring some real problems.

Anyway, I got a couple of reports in this morning from my Road Warriors.

Kevin, Just a note to tell you more rain in our forcast today/tonight and a freeze warning for Tuesday morning…a wide spread warning. OH-BOY.
RTA Road warrior

John

Hello from Julie the truck driver.

Recently we have been having a steady run from Louisville KY to Sioux Falls SD. Here is what we heard from the field. South Dakota is getting fields planted but mainly focusing on Wheat. At a restaurant in Kingdom City MO the farmers were gathered in a back room talking over the plight of wet lands making it impossible to seed.

I know when we drive across I65 in Illinois and Indiana the fields look an ancient swamp land. A lot of the water has receded but water still saturates the land.

We were just at a Sams Club in Louisville KY and they are limiting the cooking oil and flour in addition to the rice.

Thank you for all you have do for us keep up the great work.

Julie, RTA Road Warrior

And look at some of these comments from Agweb.com which just confirm what RTA’s Road Warriors are saying.

Here’s a sampling of what some folks are saying:
4/25 - North Central Iowa, Butler County: We received 4″ of rain from 9:30 last night to 5 AM.We haven’t turned a wheel yet, not even done rock pickup detail. Now with cold temperatures dippin into the 30’s over the next few nights, I’m glad to say the corn is still in the bag. We are sticking to our 100% corn plan, but may switch to some earlier varieties if this pattern continues to exist. Good luck to all this spring and be safe.
4/25 - West Central Minnesota: Not a kernel of corn in the ground yet! The ground is white with snow & blizzard warnings out till Saturday pm. I’m a fertilizer dealer & am very concern that transportation of product will be a nightmare when it dries out. Also had a major suppler say, “Sorry, but we over sold, so here is your money back” How am I suppose to provide for my farmers when this is how we get treated?


4/25 - Southwest Illinois-St. Clair/Madison Counties: For the most part we are still wet. Not as wet as two weeks ago, but still to wet for much field work. I little corn planted in the bottoms on some sand, but very limited. A little NH3 going on some of the well drained fields, but probably only a couple of percent. A pretty good line of storms rumbling across MO, so I’m guessing we will wind up with about 1 good day of field work so far. Another shot at rain again on Sunday. Most folks are getting edgy, but no one is talking about switching crop plans as of now. Most wheat is topdressed. Wheat conditions range from good on the rolling ground to average or poor on the flatter ground. I still think we have a chance at a decent wheat crop, but the potential for disease and is also very high. Not huge wheat acres here in the north part of the county so for most it’s merely a topic of discussion.

4/25 - Southeast Nebraska: After several days of fertilizing and planting we have a near 1.5 inch of rain. I have no fertilizing or planting done as bottom land was to wet. No corn planting until May and it will hurt yields in this area if not in the ground by May 1. Calf crop in this area has above usual number of death losses.

So as you can see form reading all of that, 2008 is starting out in pretty poor shape and now with each passing day yields for corn and other crops are threatened. On top of all of that word is out that wheat crops may not only be threatened by this late cold snap but also by disease. More on that in our longer mailbag issue later this week.

I am looking at two more trades right now and I will let you know either way this week. Meanwhile I am preparing to leave on another trip yet again.

Dububble

Ok so you ever wonder what all that $4 gas and $120 crude pays for well I am about to see first hand when I fly over to Abu Dhabi and Dubai this Friday. I will be speaking at the Sovereign Wealth and Resources Conference in Abu Dhabi and also visiting the Rude Awakenings own Joel Bowman in Dubai. He calls it Dububble! Well indoor skiing in the Desert and underwater hotels may only be the tip of the iceberg in the desert , we will see. Meanwhile as oil chugs along there seems to be no help from OPEC who came out this morning and said that oil supplies remain fine. That’s despite the strike at BP and the attack on an oil terminal in Nigeria. Get comfortable with the idea of $4.50 or higher for gas this summer because I think it is almost a certainty.

Here are my comments on oil with the folks at Squawk Box this morning, Take a look! Click Link Below

CNBC Squawk Box

Those of you who have been with me a couple of years know I usually try to get out to see some farmers this time of year, and 2008 is no exception. The unusually wet planting conditions have pushed back planting, and an exact date to get all those crops in the ground still seems unclear.

You see, the wet, muddy conditions and continued rain make it next to impossible to get equipment in the fields. Also, farmers run the risk of putting seeds in too early and, basically, losing the crop. The situation is pretty grave this year, as demand for all the grains is very high, as are the costs to plant them. The hope seems to be that we will have another year like last year and Mother Nature will be kind. It may not end up that way.

Real crop conditions, farmers’ and ranchers’ sentiments and concerns and good old home cooking are not things you can get sitting at a desk in New York or Washington, D.C. Nope, you have to go to the fields and see for yourself.

When you’re standing out in a cold, wet, muddy cornfield with no corn in it, but plenty of standing water, you get a sense of what we may be facing. In an effort to bring you the best firsthand information for your trading decisions, I travel far and wide to meet directly with everyone from farmers and ranchers in the Midwest to fund traders in the Middle East. I just returned from the Singapore Plantation Investment Asia conference, as you know.

I will be heading to Minnesota on the 17th for a few days of visiting farms, hog operations and even an under-construction ethanol plant in Janesville, Minn. I am taking my family along, since my mother-in-law is in town from Estonia and has never met my family in Minnesota. That will be very nice.

I plan to interview as many farmers as I can and get a real sense of what they are thinking, not only about this crop year, but also about the next five. Doing this in past years has proven very valuable. After all, I knew corn would be going to $6 three years ago largely because of what I found out by visiting farms and seeing what was going on long before the ethanol boom landed on the front page of Barron’s.

The other thing that has proved very valuable is my farmers/traders network. I have several loyal RTA readers who travel the highways and byways of the Midwest and see crop conditions firsthand during growing season. Best of all, they let me know. This is far better than anything Washington and the USDA put out, and it’s unbiased. Sure, it’s not scientific or regulated by the government. It also doesn’t cost anything… all reasons why it works.

Here is a report I just got from “John,” one of my road warriors:

“Did a drive around central Illinois yesterday… Peoria to Bloomington, up to the Quad Cities and then back to Peoria. Looked at about 265 miles of crop fields. One 50-acre plot had been aerated. That was all. LOTS of fields with standing water. Also lots of washed-out areas and grass waterways covered in mud. The bottom ground told tales of high water from the corn stalk residue all washed to the farthest side, away from the creek. Some fields had large chunks of trees resting hundreds of feet from the banks of the creek or river. More rain is in our forecast for tomorrow.

“Have a good one. I’ll be on the road twice next week. Also… while in Bloomington, I saw diesel fuel for $4.03 and $4.08… OUCH!” Keep them coming, John. If you are in the Farm Belt and would like to send updates all during growing season for your fellow RTA readers and myself, please send them to kevinscottkerr@mac.com . We all really appreciate it. And if you are a farmer, rancher, elevator operator or farm equipment dealer in Minnesota or possibly even Wisconsin, please let me know, as I would love to meet and speak with you during my visit. Just e-mail me at the above address.

So when I get back from the farm tour, there is no rest for the weary. I will be headed down to Baltimore for one day for our editorial meeting — can’t do both days, because I have to get back to New York to prepare to fly to Abu Dhabi and Dubai.

As I said, there is no limit on where I will go to bring you the most cutting-edge information, contacts and trading advice. More on my trip to the Middle East soon.

Well it’s that time of year again.  The flowers are starting to bloom, the temperatures are warming up, baseball fever is starting and crop progress reports are too.

A quick story to tell you from last week in media land: I am not a baseball fan, sorry to say, but there I was at Fox News last week, doing my second interview of the day — this one with Cavuto. Anyway, I sat in the green room with this big guy sitting across from me. His girlfriend and an even bigger, massive guy were there also. I had no idea who they were. As I said, baseball falls far down my list, next to croquet and bowling. I am a hockey guy.

 

Anyway, on the green room TV, they were talking about gold. All of a sudden, this guy asks the bigger guy, “How can we invest in gold?”

My ears perked up, and I said, “You can talk to me.” They both suddenly looked up at me and I felt a little intimidated. The first guy and I started talking, and I told him why I was there, about RTA, why gold has been going higher, etc.

I gave him one of my Maniac Trader business cards, which he liked a lot. He said he might call me if he wants to learn more about gold. I said, “Sure, great. Take care,” and then the three of them left. I never did get their names.

All of a sudden, one of the producers came up to me and said, “Do you know who that is?”

“Ah, no,” I said.

“That is Jose Canseco.”

 

I must have looked kind of blank, and then I said, “Oh, he is a baseball player, right?”

The producer said, “Ah yes, that’s right,” in a sort of “man, you are an idiot” tone of voice.

Anyway, the guy went on with Cavuto and was grilled about his new book. At one point, Cavuto said he thought Canseco was going to come over the desk at him. I thought so too.

Meanwhile, the other big guy was not his bodyguard. He was his lawyer. Looked like he had had a little of the magic steroid juice too. Now, that’s the kind of attorney I need. Maybe if my attorneys looked like the Hulk and were on steroids, I could get my regulatory applications for my funds done sooner, rather than the months on end it is taking. Maybe I can do a trade with Canseco and get some steroids for my lawyers and accountant, if I give him advice on gold. I will keep you posted. Here is a link to the video of the interview with Cavuto that was shot right after I talked with him. I swear he looks like he is going to beat Neil up – you can see it here.

 

And if you want, in the video search box, just type “Canseco” and look for the April 2 interview featuring Canseco. Enjoy

 

 

 

Well as I wake up this morning I am greeted with a voicemail message, not good I think.  ”Mr. Kerr this is Anthony at RCG…(UH OH) You sold your June gold at 925 on a stop, have a nice day!”  Morning sunshine!  It’s always nice to wake up to losing several thousand dollars…lol  Losses are a part of trading and I always tell people this, granted they are not a fun part but truly necessary.  

Ok now bear with me while I get a bit philosophical on you.  How we handle losses is as important as how we handle winners.  It is important to keep everything in perspective.  Now this account I have the gold in was a small account and over the past 3 months I have taken a good deal of money out of it…In dribs and drabs here and there.  Certainly more than I have now lost.  So in actuality this correction and subsequent loss is not as dramatic as it could have been.  And I am going to need the write off anyway.  See the glass can be half empty or half full, it’s up to you.  

The most important thing is never to let a loss break you down or blow you out.  In other words let your account go debit or some other nightmare.  Don’t be that guy that we hear about on TV.  Set your limit and then take the loss.  Trust me it will clear the decks and then you can proceed on. If anything in all this my worst mistake was absolutely unforgivable…I didn’t even take my own advice…

Here  I am last week saying that commodities are ripe for a correction and yet I held onto some gold…  You see sometimes you can give good advice that you just can’t heed yourself…i.e Governor Elliot Spitzer comes to mind.

Anyway, if you haven’t already be sure to check out my clips on Kudlow & CO. and CNBC’s Squawk Box last week and Monday where I say we are headed for a big correction.  Now let’s look at why commodities are really pulling back so sharply…

Basically what we have is a global margin call a wave of liquidation.  Is it really that anyone believes the Fed is about to start supporting the dollar?  It seems like wishful thinking at the very least.   Heavy job losses, mounting inflation, and constant interest rate cuts to appease Wall Street have put us here and now we have to take it.  

 

Hot money is getting sucked out of commodities as well it should.  Many of them moved too far too fast.  Gold, oil, the grains markets all had become un-tradeable, as they basically became detached from any sort of market fundamentals.  Now with these dramatic pullbacks we will see certain commodities return to very attractive buying levels and the grain markets are the first ones on my radar.  Precious metals and oil will take longer to recover and soft commodities, well they are on a case by case basis.

The most important thing to understand is this is a correction, albeit a dramatic one and a reminder of how volatile these markets can be.   However, it is in times like these when we get necessary yet knee jerk type reactions, that we really take a long look at the landscape and see what has been oversold and why?

Again, if this selling is merely on fund liquidation and profit taking then so be it.  Maybe that means that down here some of the commodities got thrown out like the baby in the bath water and may well be a bargain that on the next move higher.  You may have to act fast because we may not see the chance for again.   Again grains seem to be the best bet.  More on this from Singapore while I am there all next week. 

 

 

Panic is never good.  Life in NY can be rough (If you can make it here) you know the song. Is this guy running away from falling Cranes or falling brokers? Hard to say, maybe it’s both. I would look for falling office equipment over there too as most of the workers are screwed.$2 a share…I would be pissed too.   I mean my coffee and b