Instead of "Market Notes," we should call this column "Stimulus Notes." After all, copper just surged to a new 2009 high.
Copper is a major component in everything around you... from power lines to plumbing to refrigerators to cars. This "in everything" factor makes it an excellent gauge of global economic activity.
As you can see from today's chart, the economy is active right now. Last week, copper "broke out" of a consolidation period started in August to reach a fresh 2009 high. Amazingly, the metal has nearly recovered to pre-crash levels of $3.25 per pound.
What should we take away from copper's breakout? Well, you should know the huge stimulus programs coming from the U.S. and Chinese governments are "working." These governments have flooded the world with cheap loans and easy money... which is driving demand and speculation in markets like copper and oil. And you should know one more thing...
Copper is a major component in everything around you... from power lines to plumbing to refrigerators to cars. This "in everything" factor makes it an excellent gauge of global economic activity.
As you can see from today's chart, the economy is active right now. Last week, copper "broke out" of a consolidation period started in August to reach a fresh 2009 high. Amazingly, the metal has nearly recovered to pre-crash levels of $3.25 per pound.
What should we take away from copper's breakout? Well, you should know the huge stimulus programs coming from the U.S. and Chinese governments are "working." These governments have flooded the world with cheap loans and easy money... which is driving demand and speculation in markets like copper and oil. And you should know one more thing...
If the trend of higher copper and higher oil continues, you should know our new "bailouts and credit for everyone" policy is debasing paper currencies... and that old ugly girlfriend from 1970s, inflation, is back in your life in a major way.
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