But give the All-American Hype Network credit. It has finally come to terms with reality. There is a commodities boom in the market.

These guys really know how to get a scoop, eh?

Until recently, CNBC was just hyping oil's rise. Now they're hyping everything with a shovel and pick in it - gold, silver, copper, zinc and, yes, even politically incorrect uranium!

The U.S. biz network has begun running entire programs on the commodities boom. And recently a commodities commercial broke out on Jimmy (Come Lately) Cramer's Mad Money program (I guess that's why they call it Mad Money, because people are mad the easy money has already been made in many of the stocks Cramer touts).

To emphasize an investment theme that some of Canada's top money managers were investing in three or four years ago, Jimmy bit the heads off his little Teddy bears while waving a brochure of a Canadian mining company, Northgate Minerals Corp. (TSX:NGX).

Hey, is that an ominous sign or what?

Of course, in Canada the commodities story is old news. Even our biz network, Report On Business TV, caught on to that fact years ago. But the fact that CNBC, which as a follower of the Wall Street tailored suits generally shows up at the party just before the band stops playing, has jumped aboard the commodities bandwagon is not good news.

Not if you're a commodities investor up to your eyeballs in oil, gold, silver, copper, zinc and uranium stocks - and especially if you've been speculating on junior commodities.

If you don't think there's froth in the commodities market, you need to take a long, hard look at Canada's junior stock market. With the resource-driven S&P/TSX Venture exchange up more than 80 per cent in the past year, the speculators of exploration companies stand to take the biggest hit when this rock band stops playing.

While many large-cap commodities stocks still carry reasonable valuations and some even look cheap, caution is warranted if you happen to own shares in something with a name like Bullmoose Resources Inc., backed by a slick promoter hawking slick brochures.

When an entire exchange is pushing toward a double in a span of about a year, you know there's trouble ahead. The only question is when.

Glorified bullmooses on the Venture are trading at bubbly market caps that are starting to resemble those wild dot-coms of six years ago. There are 20 stocks on the Venture that are up 500 per cent or more in the first four months of the year. Every single one of them is an exploration company. Some of them probably don't even own a pick and shovel.

Raging bull markets are a breeding ground for scam artists masquerading as CEOs. If you think it's going to be different this time, you are only fooling yourself.

Mal Spooner, CEO of Mavrix Funds (TSX:MVX), provides some tips for separating the pretenders from what he terms the "real McCoys" in the resource sector. In his 2005 book, Resources Rock, Spooner (featured in 3 Stars on Page 12) lists five key points to help speculators avoid getting hoodwinked by unsavory promoters:

* If you come across an unusual company in an industry that you're interested in, do your homework or 'due diligence' before buying.

* Ask your investment adviser for reports about the company. If the principals have a sordid past, it will likely surface in the information from the research department.

* Search the Internet for a company website. Good businesses are proud of their work, are likely to have third-party confirmation of their results done by reputable engineering services companies, and their press releases will usually be more substance than hype.

* Check the biographies of the company's executives and directors. Biographies should list relevant experience and accomplishments, so be wary if there are bold claims such as "single-handedly discovered" this or that deposit or mine. If long stretches of time in their careers are unaccounted for, or if they have suddenly jumped from a completely different industry, consider that to be a red flag.

* If the website is short on content, then look up the company's address or phone number and write or call for current annual reports and press releases.

A familiar pattern of late is a penchant by junior resource companies to try and make shareholders feel all warm and fuzzy with rosy press releases. One should be particularly wary of companies whose press releases start out by saying they are "very pleased" or "extremely pleased" to announce their news. This often means that they're not very pleased at all.

However, if you own one of the quality juniors with advanced exploration projects and proven leadership, there may still be tremendous upside for those stocks. At least, that's the word from a New York-based economic consulting firm that believes a "major paradigm shift" may be emerging in which junior resource companies, traditionally shunned by major financial institutions, begin to earn the attention and respect from the highrollers on Wall Street.

KWR International wrote in a recent report that "institutions appear to be slowly realizing the rise of commodities, metals and energy is not likely to be a short-term phenomenon, but rather one that will endure so long as global growth and demographic trends continue at anywhere close to present levels. We have seen this change reflected in numerous conversations with fund managers, bankers and other financial professionals in recent months."

The report, authored by Keith Rabin and Scott MacDonald, also states that "major institutions are just beginning to wake up to the promise and potential of the resource market. As deep-pocketed asset managers enter this market, shortsellers no longer can remain totally confident of their ability to shake out and instil fear among small institutions, die-hard retail investors and others who are unable to withstand this pressure without risk or consequences."

KWR noted that some major firms have started to sound like some Canadian firms and U.S. newsletter writers who have blazed the trail into commodities. It gave examples of references to the commodities sector by influential U.S. firms such as Citibank, which has stated that the "party isn't over yet," and Merrill Lynch, which has predicted that "gold is poised to move higher."

KWR, which counts the world's largest gold producer, Toronto-based Barrick Gold (TSX:ABX), among its clients, also points out that the boom in dot-com stocks "went on far longer and showed far more upside on less tangible fundamentals than the resource mania now emerging."

However, even if institutional investors were to take a shine to junior resource stocks, they won't be speculating on bullmoose or Mark Twain's version of a gold mine - "a hole in the ground with a liar at the top.”

And, when interest wanes in the junior resource sector, the companies hyping bullmoose will undoubtedly be the first to hit the skids, just as the dot-coms that soared on hot air and little substance were the first to see their bubbles burst.

When sentiment turns, it can turn on a dime and glorified moose pasture can be magically transformed back into plain, old bullmoose in a heartbeat. That's not a prediction. That's just the reality of a speculative market.

* SAGE WORDS: "Just remember, bulls and bears get rich. Pigs get slaughtered."

- Mal Spooner, Resources Rock.

(Gyle Konotopetz can be reached at gyle@businessedge.ca)