Thursday, March 19, 2009
Copper prices are up over 40% from their December lows. You see this pattern in a lot of commodities (crude oil is up about 50%), even though broad commodity indices are relatively flat. The main message I see is that the big commodity price deflation of late last year is history. Demand is coming back, monetary policy is reflationary, and forced liquidation of carry trades appears to be a thing of the past. The global economy is not going down a black hole. Optimism is warranted.
Posted by Scott Grannis at 8:19 AM