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If something can't go on forever, it won't
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Oil slides back towards $100 a barrel despite strong economic growth in the US. It looks like the hedge funds who rode the wave on the way up are taking a hit on the way down:
Like Grandma always said, the wheel goes round and round, and sooner or later the fly on top gets to be the fly on the bottom.
The commodities reversal is beginning to punish some large investors. Ospraie Management, one of the largest players in commodities, said it is shutting down its biggest fund following significant losses. The fund declined 27% in August alone on bets on oil, natural gas and structured products. Formerly high-flying commodities-related stocks have also taken a beating in recent sessions, hurting stock investors who had hoped to ride the commodities wave.
Like Grandma always said, the wheel goes round and round, and sooner or later the fly on top gets to be the fly on the bottom.
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