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A Critical Day for Commodities: Wheat, Aluminum and Copper [View article]
Even, if one assume that the world will go to a terrible depression with overall world consumption drops by 20-30%, people still will need to eat, drive, work and use utilities.
The USA and EU are printing mountains of fiat-currencies to maintain their non-sustained standards of living. The Western societies are like drug-edicts, and by providing more low-priced and/or free drugs will not cure them or their society.
As commodities prices are going down well below the prices of producing them, two things will happen
- Commodities companies become so cheap that industries-wide consolidations/mergers will take places creating huge and eventually very non-productive monopolies
- Commodities production will drop enormously creating widespread shortages and huge price increases
Bottom Line
a) consumers, enjoy cheap commodity prices as long as they last
b) Commodities investor, prepare to enjoy huge rewards waiting for you just around a corner.