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Author: Jim2B Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 41594  
Subject: Re: Ideas for 2013 Date: 1/6/2013 3:00 PM
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Denny (et al),

My concept in putting the list together was that I'm worried about the potential for inflation given current spending levels.

The traditional hedge against inflation is to buy commodities. However, I feel like buying commodities is a little like buying options - you could be right about everything except the timing and still lose your shirt.

My hedge against the commodities hedge is to look at commodity stocks. Typically I look at oil (there will be demand for oil for the foreseeable future).

However, I don't see good buys in oil right now and as our earlier discussion revealed there is uncertainty in the short-term (3-5 year) future in oil due to recent finds and the development of shale hydrocarbons.

Because of all of that, I've decided to try branching out. I'm looking at other off (my) wall commodities that might see demand. I came up with fertilizers, rare earths, and some industrial metals (Al & Cu). The thing is all of these will depend upon the world economy too. This leaves me with trying to find the "best in class" in these arenas. I think those will likely see the best returns during an economic recovery.

Thank you for your ideas in the REE arena. I've got a bit more information (relative abundance and $/gram) that I can share on the REEs if I can format it conveniently for the Fool (its in spreadsheet format now).

I'm continuing to look for more commodity ideas.

Disclosure:
I own TNH & AA. I have buy orders in for MCP & FCX but these are unlikely to be filled in the near future.
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