Skip to main content
The boards are getting a new home!

We're pleased to announce an update is coming to the community boards. We are migrating the boards to a new platform. The site is currently in read-only mode and we will bring it back online as soon as the migration is complete.

Monday, September 26th 8AM EST: The migration is taking longer than expected, we need a few more hours to bring the site back online. | The Motley Fool Community
Message Font: Serif | Sans-Serif
No. of Recommendations: 2
The record 39% decline in commodities since July 3 is nowhere near finished, if history is any guide.

The Reuters/Jefferies CRB Index of 19 commodities from coffee to silver would have to drop another 37% to reach the trough of the 2001 recession and 35% for the 1998 slide, when crude bottomed at $US10.35 a barrel. The measure is 28% above its lowest during the economic contraction that ended in November 1982. Copper, after its biggest weekly loss in two decades last week, is still triple 2001 levels.

While tumbling prices of oil, nickel and soybeans already crippled stock markets from Moscow to Sao Paulo and sliced Alcoa Inc.'s profits by 52%, investors say rising stockpiles of copper and slowing energy demand mean prices will continue to fall. The US slowdown will last more than a year and be deeper than any in three decades, according to Harvard University economist Martin Feldstein, a member of the committee that charts American business cycles.

``This downturn is going to make 2001 look like a walk in the park,'' said Tim Mercer, chief investment officer of Hong Kong-based hedge fund Musashi Capital Ltd., who sold all his commodity investments in July. ``This is the bursting of a 25-year asset-credit bubble. People have really stopped spending money, everywhere.''
Print the post  


When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.