• Submitted by: manso
• Business and Economy
• 01 / 01 / 2011

---

The spot price of nickle on international markets has more than doubled since April 2009, which is good news for Cuba. It is predicted to rise further on the back of investment decisions by footloose international capital which has been rendered virtually free by a decade of continuous and increasing US quantative easing policies as the US treasurey prints dollars as if they were going out of fashion.

Having inflated property bubbles in various markets, not the least of which was the property bubble in the USA, the next bubble such financial policies are inflating is a comodity bubble with grains, oil, and metals all showing rapid upwards valuations. Speculation is forcing prices up irrespective of underlying global demand which remains weak.

One of the world's largests exporters of nickle, Cuba suffered a cash crunch when nickle prices collapsed in the 16 months to October 2008, slashing Cuban income from the comodity by almost 75% and producing a cashflow crisis which forced the Government to impose restrictions of the export of capital on foreign companies operating in Cuba and delay making payments to its foreign suppliers.

How long such high prices can be sustained is determined only by market sentiment and, right now, the herd instingts that rule the international markets are facing in only one direction: upwards, and the tills in Cuba are ringing in the cash.

Data Source: http://www.kitcometals.com/charts/nickel_historical_large.html

Source: http://groups.yahoo.com/group/CubaNews/message/119975