Why the fall in metals prices is just a blip

With massive growth in China and India driving demand, metals are most definitely booming, not bubbling. And you can still get exposure to this 'mother of all bull markets' via some surprisingly cheap stocks...

What's the difference between a boom and a bubble? The answer is a simple one. A market is showing signs of being in a bubble when prices reach levels that are entirely unjustified by the fundamentals. But it is booming when prices are rising fast but those price rises are justified by the fundamentals.

Consider the period in the late 1990s when internet stocks seemed to be doubling every day. That was definitely a bubble. Speculators were buying for no good reason other than that they thought prices would keep going up.

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Merryn Somerset Webb

Merryn Somerset Webb started her career in Tokyo at public broadcaster NHK before becoming a Japanese equity broker at what was then Warburgs. She went on to work at SBC and UBS without moving from her desk in Kamiyacho (it was the age of mergers).

After five years in Japan she returned to work in the UK at Paribas. This soon became BNP Paribas. Again, no desk move was required. On leaving the City, Merryn helped The Week magazine with its City pages before becoming the launch editor of MoneyWeek in 2000 and taking on columns first in the Sunday Times and then in 2009 in the Financial Times

Twenty years on, MoneyWeek is the best-selling financial magazine in the UK. Merryn was its Editor in Chief until 2022. She is now a senior columnist at Bloomberg and host of the Merryn Talks Money podcast -  but still writes for Moneyweek monthly. 

Merryn is also is a non executive director of two investment trusts – BlackRock Throgmorton, and the Murray Income Investment Trust.