|I also look at the commodity prices (mainly corn, soybeans, wheat, lumber, copper) and noticed that prices have been at multi year lows and the stock market at/near all time highs. When you look at the divergence, there is always a reversion to the mean price (commodity prices increase and stock prices fall) which reflects the nature of cycles. Price bubbles always 'pop'.|
What is interesting is that Oil/NG prices had a very nice recovery from the recent lows and only now w/ the inventory builds we have seen those prices fall. That price action may be indicating a slowing of the U.S. economy (and world economies).
The one thing I am having a hard time reconciling are these negative interest rates (Germany, Japan and now parts of Europe w/ Italy close to going negative). That really can not be sustained and there is some speculation that U.S. interest rates may/could go negative too.
I still am bullish on commodities, using the reversion to the mean idea. Maybe stock market has peaked but there are many factors that go into the market price. Add tariffs to that mix and the huge $22 Trln US debt and the use of leveraged debt around the world.
One conclusion I have come up with is it is very difficult to be a farmer even w/ the technology and the new GMO seeds. Weather is always a big factor.