- Recession
or Recovery : Another point worth noting is that
commodity prices will increase significantly in the periods
immediately after the end of a recession. As the global
economy expands, the demand for commodities will correspondingly
rise and with it, commodity prices. An economic recovery
will generally demand a higher usage of commodities, resulting
in higher commodity prices.
- Geopolitical
Events :
Recent geopolitical events, resulting in unstable markets
and potentially adverse commodity distribution (such as
in oil from the oil producing countries) are causing commodity
prices to rise (Iraq, Saudi Arabia, Iran, Nigeria, Venezuela)
- Historical
theme :
There has been a recent analogy made between the United
States as an empire and the Roman Empire in decline. The
Roman Empire in decline was characterized by on-going skirmishes
and wars at the fringes of its lands, accompanied by rising
inflation and a depreciating currency. With the United States
appearing to fall into the empire mold, given recent geopolitical
events, the likelihood of rising inflation and a depreciating
currency increases, and consequently, a general rise in
commodity prices could be expected.
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