Banana Man blows bigger iron bubble

Thursday, 28 July 2016

The Big Iron bubble has new life today with Banana Man going nuts in the Dalian bourse, up again this morning, and local miners trailing along with BHP 0.7%, RIO 1.4% and FMG 4% and at new bubble highs:

FMG’s 58% iron ore discount has blown out to -18% today and the spread is like wow:

How far it goes is anybody’s guess but I maintain that a medium term short gets more compelling with every move up.

The full text of this article is available to MacroBusiness subscribers

$1 for your first month, then:

$24.99 / month

$249 / year

Cancel at any time through our billing provider, Stripe

About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.