logo
  Join        Login             Stock Quote

Commodities Calling For Economic Recovery To Stumble Again!

 April 09, 2013 01:57 PM


As a six-year chart of the CRB Index of Commodity Prices shows, declining commodity prices usually indicate demand for goods is dropping and the economy is in trouble.

We won't talk about the bottom falling out of commodity prices and everything else in the financial meltdown of 2008.

But the CRB Index was also an indicator of the economic recovery stumbling in each of the last three years.

[Related -Old Bank's New Breakout has Big Rally Potential]

In the summer of 2010 the CRB Commodity Index fell 15%. The economic recovery stumbled, and the S&P 500 also fell 15% in that summer's market correction before the Fed came to the rescue with QE2.

In 2011, the CRB Index fell again, declining 19.5%. And sure enough, the economic recovery stumbled again, the S&P 500 declining 21% before the Fed came to the rescue with ‘operation twist'.

Last year the CRB Index had only partially recovered from its 2011 decline, and topped out again, and the economy stumbled again with the S&P 500 pulling back 11% to its June low

And here we are this year with the CRB having topped out last fall, and not recovering at all in the winter months even though the economy seemed to be recovering again and the stock market has been in an impressive favorable season winter rally.

[Related -A Mixed Bag Of US Economic Data For May… So Far]

The CRB has declined 9% so far from its most recent peak, making lower highs on its short-term rally attempts and lower lows on its subsequent pullbacks, showing no signs of reversing to the upside.

Maybe it will be different this time, but it seems to be yet another indication that the economic recovery is due to stumble again this year.

iOnTheMarket Premium
Advertisement

Advertisement


Post Comment -- Login is required to post message
Name:  
Alert for new comments:
Your email:
Your Website:
Title:
Comments:
 

rss feed

Latest Stories

article imageOld Bank's New Breakout has Big Rally Potential

One of my favorite things to see in a long candidate is a pattern of beating Wall Street's earnings read on...

article imageIs The Stock Market's 5-Year Return A Useful Proxy For Valuation?

Tobin’s Q, a market-valuation metric, is back in the news, in part thanks to a widely read Bloomberg read on...

article image4 Dogs To Sell Immediately

Despite the chorus of analysts and investors calling for the long-awaited correction, the market is showing read on...

article imageThe Fed's Magical Mystery Tour

What's going on at the Fed? Notorious dove, Charles Evans of the Chicago Fed, gave a speech in read on...

Advertisement
Popular Articles

Advertisement
Daily Sector Scan
Partner Center



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.