[Concerned]

This is not like a dot com my simple minded Denver.

Oil is something far more valuable than Amazon's "one click" shopping.

Are you still enjoying the "unimpeded economic" growth you were touting circa 6-9 months ago. Enjoy !

In case you missed it (in all likelyhood yes) the answer to your original question is a resounding NO!

You may bookmark and quote me on this at will. With ONE caveat commodities will tumble but only on the back of a major global economic downturn.

YOU WILL NEVER HAVE WHAT WE EXPERIENCE OVER THE LAST 30 YEARS INCREASING LEVELS OF GROWTH AND PROSPERITY WITH REDUCING COSTS OF COMMODITIES. The key of course being cheap energy.

Have a nice day. Nay have a great day. I am singing in the rain... what a glorious feeling...

[Starvid]

$this->bbcode_second_pass_quote('', 'W')ith crude oil hogging the headlines, one tends to forget that metals have been especially pathetic performers in the last three months. Lead is 37% cheaper now than on January 1. Nickel has fallen 30% this year, the worst among all LME-traded metals. Even gold has remained flat on average after shooting up 10% in the beginning of 2008 while silver has barely budged.

[JohnDenver]

$this->bbcode_second_pass_quote('Concerned', 'A')re you still enjoying the "unimpeded economic" growth you were touting circa 6-9 months ago.

[Revi]

Deflation is the problem now. The value of houses, most cars, silver, commodities are all going down a bit now, or holding steady.

Hold on. Recession/depression is here.

No more easy things to buy now.

Despite JD's prediction of 3.9% global growth, the US is supposed to post 1% growth at best next year according to Business Week.

Maybe Asia is the new engine of the world economy.

Wait until the olympics are over, then we'll see...

[Tyler_JC]

Gold is doing alright. We're still up year-over-year. The long term trend is up.

I don't own gold in order to get rich, I own gold as a hedge against potential dollar weakness.

Just as it wouldn't make sense to load up exclusively on shares of high tech companies or baseball cards, it doesn't make sense to own nothing but gold.

Diversification is your friend.

[sameu]

we haven't increased alternatives significantly
we didn't change our lifestyle dramaticly
the lifeblood of our economy still remains oil
So no, the bubble hasn't popped
in fact there is no bubble

[efarmer]

Inertia! Inertia! Inertia!

Huge systems like this have inertia and monstrous overshoot
due to it. I think we will have to give it until about 2011 and then
run the cumulative graphs to see what is really what. Speculation
and manipulation causes almost instant jerks and responses, and
with the Central Banks and others doctoring the systems, the real
fundamentals require longer data samplings to be observed.

I don't know if the bubble has popped but the chicken has
come home and is looking for a place to roost, and he is
hungry for bugs to eat.

[joewp]

$this->bbcode_second_pass_quote('JohnDenver', '')$this->bbcode_second_pass_quote('', 'E')ven gold has remained flat on average after shooting up 10% in the beginning of 2008 while silver has barely budged.

[ROCKMAN]

I'm with you efarmer. I lived thru the price spike/demand destruction of the late 70's to mid 80's. It takes a very long time for economies to adjust to significant changes. Just a wild guess but I would say we're just beginning to see the net effect of $60 -$80 oil. Still need another 12 to 18 months to see where $120+ oil pushes us IMHO.

[Concerned]

$this->bbcode_second_pass_quote('JohnDenver', '
')
Did you miss this nifty little graphic from the Oil Drum a couple of days ago?

[Concerned]

$this->bbcode_second_pass_quote('JohnDenver', '')$this->bbcode_second_pass_quote('Concerned', 'A')re you still enjoying the "unimpeded economic" growth you were touting circa 6-9 months ago.

[Fiddlerdave]

$this->bbcode_second_pass_quote('pstarr', '')$this->bbcode_second_pass_quote('ROCKMAN', 'T')he Law of Receding Horizons explains this. It explains why production costs always push the break-even point for low-grade energies up beyond economic sense, why oil shale for instance will always be too expensive. The more energy we must expend to gather energy, the less will be available for productive use. This is reflected in higher energy prices, less consumer buying power (but not lower GDP.) As eroei approaches 0 all work goes into getting energy.

Only net-energy analysis and eroei can measure the real state of affairs. The question now is how to tie this study with economic indicators.

$this->bbcode_second_pass_quote('Concerned', '')$this->bbcode_second_pass_quote('JohnDenver', '
')
Did you miss this nifty little graphic from the Oil Drum a couple of days ago?

[TheDude]

Looking for up-to-date charts on GDP I found this interesting item:

Chart of the day: S&P vs. nominal GDP

$this->bbcode_second_pass_quote('', 'E')conomists have a way of coming up with more ratios and statistics than you can shake a stick at. True to my profession, I have developed a long-term yardstick of market overvaluation and undervaluation. I have no short-hand for it yet so I'll call it what it is: 10-yr. rolling average S&P 500 annualized returns vs. annualized nominal GDP growth. Now, that's a mouthful. Let me explain what it's supposed to show.

Basically, the stock market is a reflection of the inherent earnings capacity of the economy. As the economy grows, so do market earnings. As a result, one would expect the returns in the stock market to reflect the growth in the economy -- at least over the long term i.e., 10 years. Unfortunately, that's not how it works.

In the real world, stock markets become severely overvalued or extremely depressed depending on whether its a bear or a bull market. The reason is P/E ratios. During bull markets, they rise. In bear markets, they fall. And, as a result, the stock market simply does not reflect the underlying growth in the economy and earnings capacity of business -- even over the long term.

That's where my graph comes in. If the economy and the stock market grew at the same rate, one would see a relatively mild fluctuation in the comparison between the 10-year average returns in the market and in nominal GDP. Now, look at this chart.



That's not what this chart shows at all. Comparing the S&P 500 index of the leading US companies to the economy shows violent swings. In the last bull market, the differential was over 10%! That's enormously overvalued. In the 1970s it was a differential of over -10%. That's a severe undervaluation. Today, we have moved back into line -- annualized returns on the S&P since 1998 are about the same as nominal GDP growth over that span.

This chart proves that market timing is crucial. Buying into an overvalued market can be deadly. But catching it at its nadir is sweet.

[yesplease]

$this->bbcode_second_pass_quote('Concerned', 'W')ho would have thunk you can make a dollar line on a chart go up by... well printing more dollars.

*puts hand on chin and ponders for a little while*

[Concerned]

$this->bbcode_second_pass_quote('OilFinder2', '
')GDP figures are always inflation-adjusted.

[JohnDenver]

$this->bbcode_second_pass_quote('Concerned', '')$this->bbcode_second_pass_quote('JohnDenver', '')$this->bbcode_second_pass_quote('Concerned', 'A')re you still enjoying the "unimpeded economic" growth you were touting circa 6-9 months ago.

[DantesPeak]

$this->bbcode_second_pass_quote('JohnDenver', ' ')The fact remains, though: The global economy continues to grow briskly, despite virtually no growth in oil production since 2004.