The biggest copper miner in the world is actually one of my favorite blue chip commodity stocks, and it's on sale again.

I've been working on a special project for WyattResearch.com readers - something that will give you access to some of our "expensive" commodity research for much less than usual.

The Royal Bank of Scotland (NYSE: RBS) lowered its expectations for all other metals, but remains bullish on gold.

The stock market has made some very unusual moves over the last few days. First, oil has rallied right along with the U.S. dollar. Then oil held firm when stocks declined sharply on Wednesday. The safe haven of gold has sold off, even with the escalation of the Italian debt situation. Banks have been weak, even thought the stock market at large has rallied on good earnings and the hope that new leadership in Greece and Italy will actually help.

I'm not heavily invested in copper for the very reason that copper prices tend to rise in line with the stock market. But copper can tell us something about one of the assets I am interested in: silver.

It’s easy to see how extra cash will help credit card companies. And overall, this is a very good move.

Stocks just ended their worst quarter since the financial crisis. The Nasdaq and S&P 500 each lost more than 12%.

If you've been following the gold markets, you know that something strange has happened over the past year or so.

In short, gold prices rose from about $1,200 an ounce this time last year, to a new record high price of $1,579 as I type.

That's a 31.6% gain.

That wasn’t the first call for the end of the commodities bull market, nor was it the most serious.

We heard it proclaimed that 2008 was the official end of the bull market – no ifs ands or buts.

“Bull Market In Commodities at an End, For Now” – New York Times

The proof? Well, you might recall that gold, oil and nearly every other commodity on the planet was on the receiving end of a huge uptrend until early 2008, when the “bubble” began to deflate a bit. As the New York Times said in October of that year:

“Since July, when prices for many commodities peaked amid fears of a permanent shortage, the prices of wheat and corn - two cereals at the base of the human food chain - have dropped 70 percent. Oil prices have dropped 55 percent. Important metals like aluminum, copper, nickel and platinum have declined more than half.”

Again, I’ll use a chart of gold as a proxy for the “commodity bubble”:

My belief as a researcher and an analyst is that undue speculation in not just the copper market - but nearly every market, including the stock market, currency markets, the bond market, etc. - my belief is that this speculation is being fueled predominately if not completely by the actions of the Federal Reserve. 

The Fed has a mandate, for better or worse, constitutionally or unconstitutionally, to maximize employment and keep GDP growth slow and steady. And now we're seeing the breadth of their power to implement those two goals - they can simply transfer "dollars" from out of thin air into the bond market, into the financial system, into the mortgage market. Those dollars have to go somewhere. Goldman Sachs (NYSE: GS) isn't likely to sit on billions of dollars - they'll put it to work speculating. The same is true of all of the Fed's member banks.

As we saw with the oil markets between 2008 and 2010, when the bets turn against the speculators, the price tends to drop to ridiculous lows. Looking at a copper chart, the same thing happened there too.

I told you last week that I would be talking with an executive at a major copper fabrication company. Now, before I get in trouble with the SEC, it’s a private company, and this executive was unable to share any proprietary or secret information that would give me any kind of leg-up as an investor.

But he was able to answer a few of my questions about copper. As you know, I spend most of my time looking at producers, the folks who look for, mine and refine copper, silver, gold, coal, iron, etc.

So I thought it would be interesting to get a perspective from a direct consumer of one of those commodities.

Here’s a lightly edited transcription of our conversation:

Resource Prospector: Thanks for agreeing to answer some questions.

I'm just looking for a little different perspective on copper prices.

Your company obviously has to buy copper on the open market - since you're not a producer - but rather a consumer.

Who do you buy your copper from?

Copper Company President: We are a semi fabricated product producer so we buy our input from both scrap dealers and cathode producers such as Kennecott.

So when I say that you should make a list of stocks to buy, I’m not saying you should jump into the market and buy them just because they’re down a few points. I’m saying you should name your price, have the capital ready, and jump on the opportunity IF it comes.

And if this correction is even half as big as I expect it to be, just about every boat will get sunk as the tide recedes.

Even big, blue chip stocks that every investor should own will get hammered.

Last year, Exxon-Mobil (NYSE: XOM) shares sold for less than $60 – even cheaper than they were during the depths of the 2008-2009 bear market – briefly selling for less than 10 times earnings.

That’s the kind of company that should be on your shopping list at that kind of price.

The Wall Street Journal reported today that troubles in Japan aren't staying on the island nation. Instead, they're spreading throughout the world.

From the Journal's article, "Global markets plunged as deepening worries over the specter of a nuclear power crisis in Japan in the wake of last week's earthquake and its economic implications sent investors scurrying again for safety."

This piece begs the question: what's safe these days? Is the U.S. Dollar safe? Are U.S. Treasuries safe?

Today, I want to discuss a huge mistake I made about one of my favorite copper investments. I like to point out my mistakes because it keeps me humble and honest. If I only point out my successes, you’re likely to (correctly) assume that I’m cherry-picking my track-record.

I also think you’ll agree that learning from mistakes is a lot more fun for you, as a reader, if I’m making them instead of you.

Two months ago, I believed that Ben Bernanke’s then-impending announcement of Quantitative Easing 2 (QE2) was likely to disappoint the market.

Here’s what I said on October 27^th - about a week before Bernanke’s announcement:

In order to take advantage of the global boom in mining, heavy equipment company Caterpillar (NYSE:CAT) announced it would acquire mining equipment maker Bucyrus (Nasdaq:BUCY) for a 30% premium.

I've been on quite a tear writing about gold and silver of late. That's not because I think you should run out and buy them right now. In fact, I think you should wait.

Wait for what I believe will be a substantial correction, and therefore, a buying opportunity for physical gold and silver next month when Ben Bernanke announces his plans for Quantitative Easing.

I'd look for a 5-10% correction following his announcement as a great time to make some purchases.

In the meantime, there's a specific stock opportunity that's shaping up nicely.

On September 1, 2010 I urged you to buy shares of Freeport McMoran (NYSE: FCX) under $80 a share.

Today I want to talk about a metal that gets little love or attention in the mainstream media - until it dramatically increases in price.

I know you've heard such claims before - but I've been scouring the headlines of major news sources, and no one is talking about this metal, even though its price is scratching highs not seen since 2008.

I'm talking about copper - a metal associated with boom-time construction. Every new building on this planet needs copper pipes for plumbing and copper wire for electricity - at the very least.

So...if housing is still in the toilet, and commercial real estate is still circling the drain, why would copper prices keep surging towards pre-recession highs?

If you were in Las Vegas, it would be cheating to bet one chip on two numbers of the roulette wheel.

They'd kick you out of the casino after taking your money and maybe roughing you up a little.

But today I'm going to reveal to you a publicly traded company that should benefit from boom times as well as bust. It's a way to put one poker chip on two numbers of the roulette wheel at the same time. And it won't get you kicked in the ribs.

My prediction is that we're headed (or already in the midst of) a severe recession or depression. But I've been wrong before - and even if I'm right on the trend, I could be wrong on the timing or the scope - or any number of other factors that might derail my investment thesis.

I hear lots of people saying that while commodities have had a nice run, the bull market in “stuff” is nearing its end. That begs the question: how long can a commodity bull market last?

It’s a valid and important question.

I’m a commodity investor, but not for sentimental reasons. As much as I value gold as a hedge against inflation, or oil’s ability to make my car go vroom – I invest in commodities for fundamental reasons – largely because I believe they are still cheap and undervalued from a historical perspective.

So, back to the question at hand. How long can a commodity run last?

Coleman Cable, Inc. (Nasdaq:CCIX) CEO Gary Yetman said volatility in the copper market, continued weakness in residential construction and general market uncertainty have hurt the maker of electrical wire and cable’s bottom line. Yetman said the Waukegan, Ill.-based firm is also experiencing inflationary pressures due to higher fuel and PVC costs. The expense pressures have been “somewhat offset” by price increases and cost-saving initiatives, he said. Yetman made the comments during a midday conference call.

For the first quarter of 2008, Coleman said in a statement that it expects revenue between $245 million and $255 million. First-quarter earnings are projected to range from $0.15 to $0.24 per share.

If the market remains calm, the CEO said he anticipates an uptick during the second half of 2008.

“Based on stable market conditions and the benefit from the synergies of our acquisitions and our cost-saving initiatives, we would expect consistent performance in the second quarter of 2008 and would then anticipate an uptick in the second half of the year from the projected benefits of the acquisition of [electrical products maker Woods Industries Inc.],” Yetman said.

After Thursday’s close, Coleman Cable reported fourth-quarter revenue of $254.3 million, up 146% from $103.2 million a year earlier. Wall Street analysts anticipated $227.4 million in revenue.

For the three months ended Dec. 31, Coleman’s net income was $4 million, or $0.24 per share, compared with $1.7 million, or $0.12 per share, during . . .

With a fifth of the world's population and a supercharged economy on pace to surpass Germany and become the world's third largest by the end of 2007, China is booming. Beijing reported that China's $2.8 trillion economy grew just shy of 12% in the second quarter, its fastest clip in 12 years. Investment in public works projects, which account for about 9% of the GDP, shot up an astounding 25.9% in the first half of 2007.

In the 1990s, the country of 1.3 billion began a monumental undertaking: building the tens of thousands of miles of modern roads and highways that today crisscross the nation (rivaling the best in the United States and Europe). Even so, after decades of under-investment, China is still playing catch-up to bring its largely antiquated infrastructure up to snuff. After all, building a global economy requires reliable communications networks, efficient transportation systems, dependable energy sources and clean water.
 
Today, an unprecedented infrastructure build-out is consuming half of the world's cement, 40% of its steel and 20% of its copper. (Approximately 45% of China's copper is used for carrying electrical current and generating power, and the demand for copper is increasing 20% annually.)

Fushi International, Inc. (Nasdaq: FSIN) is China's largest manufacturer of bimetallic wire. Its principal products are copper-clad aluminum (CCA) wires, which are primarily used for telephone lines, cable TV (CATV) systems, network signal transmission cable, electric railway conductor lines, patch cords for electronic components and other applications. Copper clad aluminum is composite wire used as a substitute for pure copper wire. Consisting of a solid aluminum core metallurgically bonded to a copper sleeve, the product takes advantage of the high conductivity of copper and aluminum's lower cost and lighter weight.

In today’s column, four noted advisors – Eric Roseman, Tom Bishop, Curtis Hesler and Nick Jones -- look at small-cap mining operations, covering gold, silver and copper. With the caveat that junior miners are dependent on the success of their developing exploration activities and, as such, offer both high risk and high reward, we offer these four favorite mining plays.

“The stage is being set for the next big rally in gold stocks,” says resources expert Eric Roseman in his Commodity Trend Alert. “I know this current market is depressing, but there is light at the end of this tunnel – bright, screaming radiant light.”

Roseman predicts that over the next several weeks, “one of the most incredible rallies will take hold in the mining sector, as the U.S. dollar comes under renewed downside pressure amid lower short-term interest rates. In hindsight, the credit crisis in the mortgage-backed securities market will be a ‘gift’ for commodity investors.”

As to specific stocks, Roseman has added a new mining buy to his portfolio: Northgate Minerals Corp. (ASE: NXG), which has a market cap of $686 million. He explains, “The stock is trading just above its low and ripe for the plucking. Northgate is a rocket, (it) mines throughout the Americas (gold and copper) and has been on my radar for months. Now is the time to kick into action and buy.”

Copper catches the attention of Tom Bishop, who notes, “Taseko Mines Ltd. (ASE: TGB), with a market cap of $619 million, is going a little bit nuts, and has doubled since I picked this as my ‘stock of the year’ in January.”

The editor of BI Research notes, “I have been asked, 'Is this takeover speculation?'  Well, it is possible in this environment of cash rich mining companies looking to add to reserves the easy way.”

The mining sector in general entails significant risk. Needless to say, low-priced, small-cap mining firms should be viewed as highly speculative. For those comfortable with these risks, a trio of advisors sees upside potential in three mining firms – two focused on gold, and one on copper.

“Caveat emptor,” emphasizes Ivan Martchev in discussing DRDGold Ltd. (Nasdaq: DROOY). In his Vital Resource Investor, he explains, “DRDGold, previously called Durban Rooodeport Deep, is a very high risk special situation. DRD may be South Africa’s fourth-largest gold miner, but the share price hit $0.54 March 14, a level it last saw in late 2000 when the precious metals boom started.”

He notes that the company is a “serial diluter,” pointing out that the company had 105.4 million shares back in 2000 and currently has 370.3 million shares outstanding. As a result, he cautions, “Its results are not an apples-to-oranges comparison.”

“Can DRD make it?” he asks. Says Martchev, “My answer has been yes, even though the brilliant managerial talent DRD possesses is starting to wear me out. Indeed, management needs to come to its senses, which is still a work in progress.”

Martchev emphasizes that this is a highly speculative idea, particular because the stock “doesn’t have an obvious catalyst, other than the fact that a sharp rally in gold can make miracles happen.”

Looking ahead, Martchev states, “If the gold price heads toward $800, the fire under DRD’s shares will be difficult to put out given the high-cost nature of production. Because I’m bullish on the gold price and precious metals in general, I think that this remains a great speculation.”

Usually investing in mining companies means having to choose between a junior company that is working to get a mine up and running, and a more stable, mature miner that is already in production.

With the former, you get more risk, at least until the final permit is received, the mining plan finalized, equipment in place, and ore being processed. Of course, that can often mean greater leverage to metal prices. With the latter, you know what you’re getting in terms of output from the mine, but that typically limits any blue-sky financial upside for investors.

But then there’s Northern Orion Resources Inc. (TSX: NNO, AMEX: NTO), which allows you to put money into both types of play with one stock. The Vancouver-based miner has a minority position in a major gold and copper mine in Argentina that, after a decade of production, is only half-way through its estimated lifespan. And investors also get exposure to the nearby—and soon-to-be-developed—Agua Rica project, which contains copper, gold, and molybdenum.

The stock is now recovering from giving up some 12% in early May due to earnings for the first quarter in 2007 coming in under estimates. But given that the cause was due to temporary setbacks - lower-than-expected recovery, shipment delays, and a higher-than-expected royalty payment - the stock at a recent price of C$5.67 looks attractive, especially once you factor in that the miner is a possible take-over target.