Commodities Approach Previous Area of Bottoming
The blog The Short Side of Long has posted a chart demonstrating the devastation experienced in the commodities markets since the middle of 2011. It appears previous overexpansion by commodities producers, slowing Chinese growth, and the recent strength in the U. S. dollar have created the perfect storm for a collapse in commodities prices.
Short Side of Long points out the inflation adjusted current low is significantly below that experienced in 1986, and suggests that the perfect play would be through precious metals; especially silver. Patience will likely be required because deflationary forces can persist while overindebtedness is the norm throughout the world.
Chart Source: Stockcharts.com, shortsideoflong.com