After watching the turbulent markets of late it's become apparently obvious that the resources market has been hit harder than most others - even the Financials are recovering yet the resource stocks continue to hold at their current levels.
The speculative end of the market has been hit across the board, regardless of mineral or material. The rot has not been limited to just speculative miners, the large producers, BHP, RIO etc have all plummeted.
I find this drop rather intriguing as I can't determine WHY this has occurred. Sure the US market is in a rut, but the majority of the resources mined and shipped on this PLANET are conveyed to China or India in a timely fashion where these raw materials are then turned into mostly LARGE infrastructure projects within these emerging nations. Sky scrapers, highways, rail, etc. These projects are necessary for the growth of these nations - regardless of the ability of the American consumer to continue their existence of consuming and borrowing to their hearts content.
Over the past 30 years, India and China have become more than just a workshop of western goodies - they have invested their income from making the west's products such that now, 30 years on, they're self sustaining economies with more financial clout than the west that created them in the first place.
Hence given that India and China are STILL emerging, their populace is expanding its consumer base and instead of producing consumer goods for the west, their now producing goods for THEIR OWN consumer - hence they're now fully independent of what should happen elsewhere.
I know that the US is still the largest economy in the world etc - but the large scale projects that demand resources are the type of projects that can be compared with an elephant on roller-skates - it takes a lot of force to get going, but once started, the momentum is extremely difficult to stop. Infrastructure projects have a long lead time, hence they'll continue to finish the project rather than put it on hold.
All in all - I'm flummoxed by the current Resource Sector's turmoil.
Anybody to care to shed some light on this discussion?
Again - DYOR!