Everyone is looking at oil and how it effects Russia, Saudi Arabia, and the shale oil producers in the midwest, but the story is a whole lot larger.
Commodity prices are at their lowest since November 2002, according to the Bloomberg Commodity Index. And while the collapse in oil to below $45 a barrel has grabbed the headlines, the index tracks 26 commodities, including gold, natural gas, corn and aluminum. Copper, for one, is in a funk similar to that of crude, falling to its lowest price in more than five years. Overall commodity prices are down more than 57 percent from their 2008 peak
This article doesn’t come out and say it (the article is about global deflation), but historically commodity prices crash on a global level for only one reason – lack of demand.
That means the global economy is very quickly coming to a stop.
The Secular Jurist 
Uh oh
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Or as Scooby-Doo says, “ruh roh!”
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😀
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I just read the full article. That’s pretty scary if it’s true. What do you think? Do you think the world economy is slowing down?
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Numbers don’t lie. The only major national economy that’s even doing marginally well right now is the U.S. China’s got big internal problems. Japan is shaky. Europe is suffering from austerity. Russia is imploding from sanctions. Brazil is sputtering. There’s not a lot of good economic news out there right now.
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Wow. It will be interesting to see how this plays out in the coming years. I’ve read in a few places, including “Collapse” by Jared Diamond, that the idea that economic growth can (and should) always continue is to assume that the world’s resources are infinite. We both know that’s impossible, but how many economists and national governments really think about the implications of this?
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Well, what they think about and what they admit to in public are often very different.
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If they know that growth can’t be infinite, how does that translate into their public policies? Do they know, but pretend not to?
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In a word… yes.
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😦
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