Posted on 04/19/2024 6:48:02 AM PDT by Diana in Wisconsin
One trite Wall Street saying is that copper is the only metal with a PhD in economics. This is because copper is an industrial metal, the demand for which waxes and wanes with economic growth and shrinkage. So falling copper prices can be a sign that economic trouble lies ahead, and the converse is also true.
I would argue that copper's more reliable role is as a leading indicator of inflation, as illustrated in this week's chart. It shows the price of copper, shifted forward by 2 months to reveal how the growth rate of the Consumer Price Index (CPI) tends to echo copper's movements. The plot of copper prices uses daily data, whereas the CPI is monthly, and so naturally there is going to be more noise in the copper data.
Generally speaking the correlation has been good, although the first couple of years after Covid strained the correlation a bit. The copper market was arguably not functioning properly then, like so many other markets, with industrial demand and copper mining production both seeing turbulence from labor availability. But that seems to have settled down now.
The latest posting for CPI just out on April 10 caught many by surprise, but it reflects an up move which already started in copper from its December 2023 low. And the most recent jump to above $4/pound says that inflation is not yet done rising.
There is room to question the legitimacy of that message, since part of the rise in copper prices may have come from speculative trading in China. The Shanghai Stock Exchange just recently imposed trading limits on futures contracts for both gold and copper, in an effort to tamp down on that trading. So if this spike disappears rapidly, then one may be able to put a thumb over that point on the chart and disregard it. For now, though, the message is that inflation is going to be rising for at least the next 2 months.
Let’s all clap for Dr. Copper!....................
As a Goldbug, this stuff actually interests me. It’s my only interest besides FOOD and gardening, LOL! :)
Copper kills bacteria. It has been used for centuries to help preserve foods.
But it has to be clean first.
So we must clap for clean copper!................
It hasn't, which means higher prices/inflation/economy is a good issue for Trump to campaign on. Sprinkle in the border and Biden's cognitive issues and you have the big 3.
Just the facts, ma’am.
Unless government interferes, which it has with the misnamed “IRA”.
Pouring trillions of dollars we don’t have into projects that use copper but do not contribute to actual economic benefit will distort things.
Beware the “economist” who wants to sell you gold. Retail gold is a fool’s game. You pay a commission to buy it, and another commission to sell it. The house always wins.
Mock me all you want. She who dies with the biggest stockpile of Gold...still dies in the end! ;)
Forget gold silver’s rise will be greater.
China switches strategy from stacking Gold to “Take all the Silver.” Sticking it to US short sellers and market riggers.
https://silverseek.com/article/china-switches-strategy-stacking-gold-take-all-silver-sticking-it-us-short-sellers-and
Record Silver Indian Imports - Who There is Buying & Why?
https://sdbullion.com/blog/record-silver-indian-imports-who-there-is-buying-and-why
Things are not looking good long term for the dollar. I would recommend every freeper pick up at least some precious metals. I don’t trust bitcoin and consider it more of a gamble.
I’m sure copper thieves look at the latest economic reports on the price of copper before the rip wires out, etc.
The school where I worked first had the copper wiring pulled out of all the a/c units, disabling them completely - then thieves stole the copper pipes in the back of the restroom facilities. Fortunately, we had another restroom, otherwise the school would have been closed until the bathrooms were repaired.
Well, we ought to -- especially since the clean copper was being kept in a closet.
Anyway, I see it at the grocery store. Higher prices, lower amonut.
Like the tuna kit: small container of tuna mix, 6 crackers is now 5 crackers
—> Retail gold is a fool’s game. You pay a commission to buy it, and another commission to sell it. The house always wins.
Stocks
Commodities
The world.
These are capitalist markets.
That has NOT been my experience. But I’ve been into PMs for close to 20 years now. Buy low, sell high. ;)
Exactly. I’ve said that in other posts. If you MUST sell, sell your Gold first. Hold on to that Silver! :)
It is theorized that at the molten center of the Earth, all the heavy metals are there, one on top of another in layers according to their weight and therefore there is a gold layer that would dwarf every ounce of gold ever mined in history............
If gold is such a great investment, why are they selling it for paper money?.
It’s like getting investment advice from Stock Brokers who aren’t millionaires.....................
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