Commodities' Run Is About More Than Just the Hedgies

It's not speculation. It's real demand. I said it about oil. I say it about ag.

For the last $60 I have heard endlessly that the reason oil is up is because of hedge funds and institutions. It is never because of things like how hard it is for Saudi Arabia to get oil out of the ground (there's an excellent article in The Wall Street Journal about this). For a treat, go listen to the Schlumberger (SLB - commentary - Cramer's Take) and Halliburton (HAL - commentary - Cramer's Take) calls to see where that business is going. Nobody focuses on the moronic decisions by governments to tax oil so much that people won't drill. The demand side away from the U.S. is going nuts. And hedge funds are supposed to be the reason prices are high? That's as laughable as believing that the Strategic Petroleum filling matters.

Now it's ag. Does it matter to the hedge fund attackers that there are crop shortages worldwide? Or that the governments of the world have been so aggressive in the food-for-oil trade that they have made it so all grains are sky-high? Does anyone think that the newly middle class people of India and China don't want beef and chicken? That's what you eat when you have some money.

No, blame the hedge funds. Next thing I will hear is that the hedge funds are why the hedge funds are shorting Monsanto (MON - commentary - Cramer's Take) and Deere (DE - commentary - Cramer's Take) and Bunge (BGE - commentary - Cramer's Take) and Potash (POT - commentary - Cramer's Take) and probably the new deal, Intrepid Potash (IPI - commentary - Cramer's Take)! They are short Mosaic (MOS - commentary - Cramer's Take) and Agrium (AGU - commentary - Cramer's Take) because they are short the grain complexes!

It's too stupid to be believed.

We have to start, somewhere, recognizing that there are real reasons for commodities to go up. Real reasons.

We should stop waiting for the hedge funds to dump the grains.

They don't have them anyway.

Random musings: Coal is like ag, are hedge funds buying that too!??

At the time of publication, Cramer had no positions in the stocks mentioned.

ALL JIM CRAMER BLOG ENTRIES | POST A COMMENT | READ COMMENTS  

---

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS. Watch Cramer on "Mad Money" weeknights on CNBC. To order Cramer's newest book -- "Jim Cramer's Stay Mad for Life: Get Rich, Stay Rich (Make Your Kids Even Richer)," click here. Click here to order "Mad Money: Watch TV, Get Rich," click here to order "Real Money: Sane Investing in an Insane World," click here to get "You Got Screwed!" and click here for Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he appreciates your feedback and invites you to send comments by clicking here.

TheStreet.com has a revenue-sharing relationship with Amazon.com under which it receives a portion of the revenue from Amazon.com purchases by customers directed there from TheStreet.com.