Charts For Various Commodities And Gold

Long term price charts for various commodities and gold

Notice that other commodities were spiking at the same time as gold in 1980. This is what I mean when I say that gold will go up a lot in dollars, but its purchasing power in terms of other commodities will only go up 2 to 5 times.

These charts also shows what I mean when I call the gold the herald of a dollar collapse: when gold prices spike, the dollar is always falling against other commodities.




Copper




Appreciation of yuan VS commodity prices



Commodities peaked exactly one year ago

During the first half of 2008, Commodity prices soared. This means gas/food prices were heading up and up right until July one year ago.

Chart of USO (track oil futures)



Although gas and food prices are half what they were a year ago, when oil was hitting $144, Chinese prices are only down 1.4 percent.


During the second half of year commodities tanked. Gas and food prices fell. As we more into the second half of 2009, CPI is going to be calculated against last years plummeting prices, so CPI numbers will start showing some serious inflation by the end of September, especially in China.





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7 Responses to Charts For Various Commodities And Gold

  1. Jane says:

    From these graphs, it seems like many commodities price are lower today than 30 years ago.

    It doesn't make sense.

    If it's true, then we should bet on commodities. It dirt cheap now (except gold).

  2. Jay says:

    Hi Eric,

    When you get a chance, can you please explain: "If the gov-co suddenly imposed a new currency (say, U.S. Notes) with a value of five FRNs to one unit of the new currency, the new price of gold in terms of the new currency would be one-fifth the current price of gold as denominated in Federal Reserve Notes."

    Thank You

  3. Martijn says:

    Alright guys: enough is enough!

    Why am I not able to find any news on Dubai (and other) requesting delivery of their physical from London?

    Anyone??

  4. Martijn says:

    Where is the follow up on Dubai's gold delivery???

  5. Martijn says:

    Eric,

    Check this, China inflation concerns are up.

  6. When the dollar collapses, prices will rise the most for any product for which a large part of the cost of the product is based on the price of commodities. This is because the reserve status of the dollar has allowed for much lower prices for commodities in the US than the price that would be determined based on purchasing power parity since the price of commodities is determined through international trade and requires purchases of greatly overvalued dollars. However, many products that are produced and traded within the US and services currently are priced more closely to a price that would be determined based on purchasing power parity. Therefore, prices for locally produced and traded goods and services will change less when the dollar collapses. If some people hold physical gold while many others hold assets such as bonds for which much of the value will be inflated away or are exposed to major losses because of counterparty risk such as by holding paper gold , those who hold physical gold will have a much larger share of the wealth in the US when the dollar collapses. When the dollar collapses, although for those who hold physical gold the ability to purchase oil based products might not increase by very much, those who hold physical gold will have the purchasing power to purchase a relatively much greater amount of locally produced and traded goods and services.

  7. Andy says:

    Hi Eric, so based on your analysis, what should people do on short term basis (less than 6 months)?

    * Don't short the stock market
    * Buy commodities
    * Buy precious metals

    Is this correct?

    Thanks.

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