|It's sexy and cheap and you can't have one . . .|
What's not diminished is the vulnerability of of iron ore and metallurgical coal to the downgrades we're seeing at the moment. It looks like China has stuffed every steel channel possible and now without serious infrastructure spending it just leaves it's suppliers high and dry. Here's the thinking that you need to get your head around. China's growth can slow and push prices down in the short term. In the long term though China knows it's main problem is to guarantee supply of important commodities to its massive and fast maturing population. To do this they're thinking that prices need to be high enough to see projects (such as Olympic Damn) go ahead, but not so high as that it causes inflation. If prices drop too far, too fast capacity will be shutdown and that could lead to bottlenecks in the future. This is a high-wire balancing act that we all need to watch. The oil shock of the early 70's was a salutary lesson to the leading tiger economy of the day Japan and the Chinese are in no mood to let things get out of control. Therefore there will be a floor out there on a commodity like iron ore, but it's not $100 or 90 or even $80 . . . but it will be there somewhere.
With no cycling news to speak of today I want readers to be assured that my own bikes will be back in my hands next week. I'll be taking the pieces to my LBS to be refitted. I think it's important to recalibrate from time to time with a professional fitter. I know that my own body shape and weight has changed since my primary fitting. I've tried to do my own minor adjustments, but sometimes you just need an independent third eye to look at things.
Sorry about the short blog, but sometimes it's better to be brief.