2008 Commodity Performance

No asset class has experienced a roller-coaster ride like commodities have in 2008. Below is a table with the performance of ten major commodities over the last year. For each commodity, we highlight its current year-to-date change, its drop from its 52-week high, and its performance from the start of the year to its 52-week high.

As shown, oil has fallen the most from its highs at -75%. Oil is trailed by copper (-70%), platinum (-61%), and natural gas (-57%). Oil is also the commodity that is down the most year to date at -62%. Of the ten commodities highlighted, gold is the only one that remains up on the year with a gain of 3.87%.

The crazy thing is that these commodities looked to be headed towards record positive years just a few months ago. At its peak, natural gas was up 83% on the year, but it is now down 22% in 2008. Oil was up 53% for the year before falling more than $100 from its highs.

As hectic as the stock market has been this year, commodities have been even more volatile.

Comments

[GMiki1:]

Gold is up for the year. Gold is up for the year. Gold is up for the year.

2008 Dec 26 07:51 PM

[Greg Pinelli:]

GMiki..it's difficult to praise your eloquence..but your correctness is indisputable. Every week on Alpha I read gold trashed by people who..believe it or not..also criticize the Fed and Treasury for abusing the people's trust. Amazing..they simply don't get that gold is the ONLY means of countering the incredible fraud we're experiencing! Barbarous relic indeed. Tell that to the Romans..the Venetians..the 19th century British Empire..and America when it could still claim some semblance of moral rectitude.

2008 Dec 26 10:08 PM

[NOWHEREMAN:]

What a crock, Gold has never, ever been the only means of countering squat. The only time that gold meant anything was when it was the currency of any given country and then it was used to purchase something else. It was given a Value by the user and Accepted at a certain value by a seller.

Gold has been priced in other currencies for centuries. Those other currencies have fluctuated against themselves for centuries.

"Here I have some Gold, I want to buy some Gold".

2008 Dec 26 10:48 PM

[Anthony Alfidi:]

Gold may not be used as a currency, but central banks still use mountains of it to stabilize currencies via interbank loans.

2008 Dec 27 01:49 AM

[NOWHEREMAN:]

Opec announcements are made but everyone figures they will exceed the new quota, they will cheat.

There was a rumor in the morning that the UAE had announced a reduction of its output by 15%. That Rumor was confirmed at the end of the day.

Add to this the lack of traders on the floor, the possibility of further announcements over the weekend and a small jump at the end of the day.

IMO

2008 Dec 27 06:21 AM

[NOWHEREMAN:]

The point is, that at the end of the day, Physical Gold IS priced at different currency levels. It IS NOT priced against a loaf of bread or a suit.

The statement that "gold is the ONLY means of countering the incredible fraud we are experiencing!" is a total crock.

Gold IS a Barbarous Relic of times past. It was used by various countries as a currency In Times Past.

It Cannot Counter Fraud. "Hey, dude, here's some gold, don't commit Fraud". Morales Are Not offset by Gold.

A Psychologist would know that. IMO

2008 Dec 27 06:45 AM

[NOWHEREMAN:]

Anthony: Gold is not used by Central Banks to stabilize currencies. All of the Gold in the World is not able to do that.

However, Banks have sold physical bullion on the open market to keep the value of Gold down.

Everyone of them perceives it as a "competing currency" and none of them wishes to return to a Gold Standard.

So Gold Can be perceived as a Universal Currency, but it Does Not have a Set Value intrinsic to itself. Its value is in the eyes of those who wish to give it Value. IMO

2008 Dec 27 06:57 AM

[Firat Ünlü:]

All it takes for oil to go up hugely is one terror attack against America. Considering there's billions at stake that's quite an incentive.
What's also interesting is how a falling dollar will affect changing the currency in terms of switching to yen/euro.

2008 Dec 27 07:13 AM

[Shiv Kapoor:]

Do you have the same chart from the prior cycle low made during Oct 02/Mar/03? It would be interesting to see how commodity gains have panned out during this period.

2008 Dec 27 09:52 AM

[kolosos35:]

You can take a "bank note" out of circulations, anytime you want.
You can replace the BP pound with the Euro. But....
You cannot replace "Gold" with anything (except health)
P.S. Burie a paper "bank note", and gold coins in the ground, and dig it up in two hundred years, and see what you find ? (Paper notes, in a chest at the bottom of the sea?)
Chuck

On Dec 27 06:45 AM aitvaras wrote:

> The point is, that at the end of the day, Physical Gold IS priced
> at different currency levels. It IS NOT priced against a loaf of
> bread or a suit.
>
> The statement that "gold is the ONLY means of countering the incredible
> fraud we are experiencing!" is a total crock.
>
> Gold IS a Barbarous Relic of times past. It was used by various countries
> as a currency In Times Past.
>
> It Cannot Counter Fraud. "Hey, dude, here's some gold, don't commit
> Fraud". Morales Are Not offset by Gold.
>
> A Psychologist would know that. IMO

2008 Dec 27 10:00 AM

[Rob Viglione:]

Bottom line is that we have a serious fiat currency issue, particularly in the U.S. The purpose of a gold standard is to keep money creation in check; unfortunately, migrating from any such control mechanism has allowed the Fed to debase our currency by a factor of 25 since 1913, when we delegated our trust.

Gold is one measure people use to counter inflationary growth of the money supply. There are others. Short currency futures, short government bonds, buy real property...and let's not forget to stock up on canned goods and bottled water!

2008 Dec 27 11:03 AM