The Commodity Boom

With all the talk about the Chinese economy and currency, we are missing the other story: China is buying commodities.

"There is definitely a boom underway," said Peter Harrison, a money manager with J.P. Morgan Fleming in London. Pick a category and the numbers are breathtaking. In 2003, industrial investment is rising at a 55 percent annual pace; loans at 25 percent; electricity use at 18 percent. In the first six months of the year car sales were up 82 percent. The growth has triggered huge demand for practically everything and much of that demand is being satisfied with imports. In the first nine months of the year imports were up 40 percent, outpacing the 32 percent gain in exports.

The great Jim Rogers predicted this several years ago and continues to cash-in, an excerpt from his book and a June 2003 interview here presents the case.