Today two of the greats in the business warned that the carnage in the commodity markets has prices at 40 year lows!
Portion of today’s note from Art Cashin: Does The Fed Know This? – We all know that most commodity prices have been in near freefall for several months now. But, many of us may not realize how historically sharp this selloff has been.
My friend and fellow trading veteran, Jim Brown, over at Option Investor wrote recently of how drastic this move has been. Here’s a bit of what Jim wrote:
“Copper, oil and all commodities continued their plunge on falling demand and the strong dollar. Copper closed at $2.10 per pound and the lowest level since 2009. The entire commodity complex is about to set a 40 year low as referenced by the $CRB. It closed today at 185.42. You have to go back to 2002 for a lower close at 183.52 and then 1999 at 182.95. Then you have to go way back to 1975 for a lower close at 175.90.
We only have to drop -2 points to be at 40-year lows and the majority of analysts are still recommending shorting commodities. I do not know how the Fed is going to rationalize raising rates in this environment. The dollar will surge and commodities will move even lower and further reducing inflation as they decline.”
Forty year lows! And, how are you, Chair Yellen?
***ALSO JUST RELEASED: Inflation/Deflation, Major Systemic Problems, Loss Of Confidence And The Crack-Up Boom CLICK HERE.
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