Bank of America

Virtually every investor has heard about how the emergence of China and India promise to send commodity prices skyward in the months and years to come. The promised run-up has yet to begin in earnest, but prognosticators say it's merely a matter of time and just the "right" catalyst.

Money Morning Contributing Editor Peter Krauth - a noted commodities expert and editor of the Global Resource Alert advisory service - says he's found that "just right" catalyst. He's calling it the "Great Global Commodities Grab," and says it's being engineered by some of Wall Street's biggest investment banks.

But here's the key point: Because Wall Street is essentially "gaming" the system, this commodities grab is a chance for investors to reap bigger returns than they would get with the leverage afforded through options and futures - but without the risk.

Investors have reached the point where this physical commodities grab "gets really interesting," Krauth said in an interview with Money Morning. "JPMorgan Chase & Co. (NYSE: JPM) now owns ships overseas and storage tanks in Canada, Asia and Europe [that hold] millions of barrels of oil. And it's far from being the only one. Back in December, one report stated that if all the tankers being used as offshore storage tanks were placed end to end, that string of ships would stretch 26 miles."

Added Krauth: "We're talking about oil supplies being physically taken off the market... that can't help but affect market prices. And that's just with oil - Wall Street investment banks are taking major physical stakes in such commodities as gold and other precious metals, too."

Krauth - a highly regarded market analyst and expert in metals, mining and energy stocks - recently sat down with Money Morning Executive Editor William Patalon III to talk about how the "Great Global Commodities Grab" is going to ignite a rally in the prices of oil, gold, other precious metals and even agricultural commodities. During the question-and-answer session, Krauth also:

• Detailed how two leading investment banks just spent more than $2 billion to buy precious-metals-storage companies.
• Talked about how gold, throughout history, always ends up taking over for fiat (paper) currencies.
• Explained how the aggressive price forecasts Wall Street investment banks have made for both oil and gold are certain to become self-fulfilling prophecies.
• And described two companies - one an energy player and the other a junior miner - that he recently recommended to his advisory service, using them as illustrations to underscore his commodity-price predictions.