Those that result my work will know I have been bullish on merchandise since 2002. In 2003 I at fault a seminar in London well-organized with serviceable global banker Jim Rogers where I explained why I was allocating a great part of my treasure to produce.
My contour has not antithetic; this still is a machine bull market and those that don ' t have an exposure to goods are absent out. Before I label the current situation I was re declaiming Igneous Merchandise by Jim Rogers where he states " Warning There will be setbacks, I cannot promise a stairway to heaven. No bull market in ration asset has ever gone straight up " Many dial out that all Bull markets have set backs, the stockmarket did not go up in a straight line between 1982 to 2000 it had many set backs, but it was a bull market. If we say this bull market started in 2000 and a typical bull market lasts 18 to 20 years then we still have some time to go.
Most investors based in Europe and the USA forget how small a part of the world we are, and the true growth is coming from China, India and other developing economies. Lets face it the UK, Europe and the USA have had their best years, they have had their years of growth and consumption, its now time for other countries to lead. Regardless of what your nationality is and where you live everyone consumes agricultural and soft commodities and will continue to do so. As the global population continues to grow and living standards increase in developing economies so does calories consumed. Forget about all they hype about more cars, TVs, fridges I am talking about the developing economies trading up from just rice to maybe rice and pork or rice and chicken.
I would guess that 95 % of those reading this do not own any agricultural commodities, I see 1000 ' s of financial advisors and fund managers investing their clients money in the stockmarket, property, bonds but when it comes to commodities bar a few specialise funds, its unheard of to have a holding in commodities. I often hear commodities are " risky " these are the same people that invest in shares which may I remind you are far riskier than commodities, shares go to zero, no commodity has ever gone to zero. For the last 30 years or so those leaving colleges and universities have aspired to go and work in the service sector and the financial sector as these areas have boomed and provided the best working conditions and salaries. Not many people have left to go in to farming but that could now change. I see the service sector declining for the next 10 to 15 years, we don ' t need so many banks, insurance companies, travel companies, restaurants or retailers. These businesses certainly in Europe and USA will have a decade of contraction where as farming will be in expansion mode.
So how do you get an exposure? The easiest way is still exchange traded funds, you can buy these via a stockbroker and they can be placed in a pension / SIPP or held in a normal account. Owning the ETFS outright means your no subject to margin calls or leverage. If you ' re willing take a little more risk then investing in agricultural based companies is another angle.
