Since I warned you Sept. 29 about the potential threat that commodities giant Glencore plc (GLEN.L) poses to the global financial markets, a lot of voices have chimed in agreeing with me. Bank of America published a report on the true size of the potential fallout here (it’s stunning). Then Zero Hedge noted that “The Next Lehman Has Arrived” (although I still feel it’s more of an AIG setup, but the point stands).
Something ridiculous happened, too. The stock has gone up.
But not for a good reason.
As I’ll show you, it looks like the rise in the company’s stock price was largely a matter of short covering, not investors suddenly deciding that everything is hunky-dory in the House of Glencore. Because that is clearly not the case.
In fact, it is a shining example of exactly what’s wrong with these markets. And I fear individual investors will get caught in the mess and wiped out on a stock like this or some of the others around it. That’s why I want to call out the misapprehensions and lies that are causing this recovery – and show you what’s next.
It could end up even worse than I thought…
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