Why it's still early in the commodities boom

In retrospect, I should've seen this coming.  All it took was for gold to take a $60 tumble in one day for establishment media to trot out the old line about how "commodities are risky."

Sure enough, it's in the New York Times…

The booming commodities market has become increasingly attractive to
investors, with hard assets like oil and gold perhaps offering a safe
hedge against inflation, as well as the double-digit gains that have
fast been disappearing from the markets for stocks, bonds and real

But this market, despite its glitter, offers risks of its own, including
some dangerous weaknesses that are impairing the ability of regulators
to police fraud and protect investors.

…and the Wall Street Journal, on the front page of its Personal Journal section:

It's a risky time for small investors to put their money into
commodities, as yesterday's broad selloff shows. Despite numerous
bullish forecasts — and a long-term rally that has seen record highs
for gold and oil — the sector remains volatile.

Yes, put your money in stocks instead.  No volatility there.

But that's OK.  Days like yesterday are good — they shake out the weak hands and give far-sighted folks an opportunity to "buy the dips" and jump in at prices that couldn't be had a few weeks ago.  I assure you yesterday's action didn't shake Bill Bonner's confidence in his "Trade of the Decade."

What's more, stories like I just cited are another sign that we're still pretty early on in a secular commodities boom.  As I've written before, it's when CNBC starts talking up junior mining shares that we'll know we're close to a top.   And we're nowhere near that now — which means there's still explosive upside potential in junior mining shares — if you're in the right ones.

Our new resident gold expert Ed Bugos has his eye on five companies right now, the ones best positioned for big gains as gold eventually makes a run north of $2100.  You can become a charter member of Ed's Gold and Options Trader for a special price — but only for a few more days.

The Daily Reckoning