Commodity “top” ?

Commodities carving out a possible bottom sent fixed income investors running for the exits today. Initially, higher bond yields will drive dollar buying in the near term. But our economic recovery is hinged upon this commodity “top”, which should give the Fed some fiscal breathing room. But wait a minute - what if the top is not in? If the commodity top has yet to trade, then coming inflationary pressures and lower equities prices will very likely postpone the US recovery - all USD negative.
I am short at 109.50 with 109.80 stops. (http://www.forex.com)

Foreign policy pulls in ‘Obamacans’

By Edward Luce by Washington
Published: August 12 2008 20:08 Last updated: August 12 2008 21:17
Barack Obama on Tuesday netted the endorsement of three prominent Republicans, including Jim Leach and Lincoln Chafee, both of whom lost their congressional seats to Democratic opponents in the 2006 mid-term elections.
The announcement boosts the ranks of so-called “Obamacans” and is likely to fuel speculation about the possibility of bigger names – such as Colin Powell, former secretary of state, and Chuck Hagel, the Republican senator for Nebraska – also endorsing the Democratic nominee.
Describing Mr Obama’s call for change as “more renewal than departure” and thus in line with traditional conservative principles, Mr Leach said: “This is simply not a time for politics as usual . . . I have no doubt that a lot of Republicans will be attracted to Obama in spite of the flaws in this year’s primary process.”
The two Republicans, along with Rita Hauser, a former White House intelligence adviser, stressed foreign policy as their principal motivation for endorsing Mr Obama.
Ms Hauser described as “bellicose” the response of John McCain, the Republican nominee, to Russia’s conflict with Georgia.
Most “Obamacans” come from the so-called realist wing of the Republican party which has fallen into deep disenchantment with president George W. Bush’s foreign policy.
Some have also stressed their hope that Mr Obama would take a more aggressive approach to solving the Israeli-Palestinian crisis even though the Democrat has taken a strongly pro-Israel line. All said they supported Mr Obama’s pledge to talk to US adversaries, including Iran.
“There is a deepening split between the traditional Nixonian realist wing of the Republican party and the neo-conservatives that has become more pronounced with John McCain’s hardline anti-Russia rhetoric,” said Steve Clemons at the New America Foundation.
“I have good reason to believe that there will be other Republicans, such as James Baker [the former secretary of state], who may withhold endorsement from McCain rather than endorse Obama directly.”
Electoral analysts say there is unlikely to be a large switch of Republican voters, although Mr Obama’s endorsement by prominent Republicans could help sway independents into the Democratic column or encourage others to stay at home.
Mr McCain is working hard to win over hawkish Democrats to his camp, following his endorsement by Joe Lieberman, the former vice-presidential candidate, earlier this year.
There is a possibility that both Mr McCain and Mr Obama could choose running mates from opposition ranks in a bid for centrist voters. Mr Hagel is thought to be an outside choice for Mr Obama’s ticket and Mr Lieberman is on Mr McCain’s shortlist.
Copyright The Financial Times Limited 2008

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