All Entries Tagged With: "commodities"
Where Is the Natural Gas Boom?
In recent years, many commentators have been predicting a natural gas boom in the United States. The country has frequently been called the “Saudi Arabia” of natural gas—a reference to the fact that Saudi Arabia contains a significant percentage of the world’s known oil reserves. Texas oil magnate T. Boone Pickens has been pushing to [...]
Gold Prices Crushed
Gold has been experiencing a notable sell-off in recent weeks, as the price of the precious metal has pulled back from about $1,800 an ounce in mid-November to the high $1,500s just last week. The reason for gold’s sell-off has been attributed to a variety of things. Commentators have cited everything from the bursting of [...]
Despite Inflation, Bank of England Official Wants More Easing
On Tuesday, the consumer price index in the U.K. rose 4.5% on an annual basis, up 0.1% from a month before. The Guardian reports that the increase in the rate of inflation was driven by a rally in the price of energy bills, as well as spiraling prices in clothing and footwear. The rise in [...]
Employment Growth Stalls
On Friday, nonfarm payroll data for the period of August was released. The data indicated that the market created no jobs in the past month. Analysts had anticipated an increase of 68,000. Due to the poor report, many market participants may be anticipating further easing from the Federal Reserve or additional government stimulus programs. On [...]
Fed’s Evans Sends Commodities Higher
On Tuesday, the President of the Federal Reserve Bank of Chicago—Charles Evans—spoke in an interview on CNBC. During and following the interview, commodities rallied. Gold spiked nearly 2%, while oil, which had been trading down in the morning session, reversed course and moved into positive territory. Evans’ comments may have been the catalyst that sent [...]
Forget QE3, Bring On OT2?
On Friday, the Chairman of the Federal Reserve Ben Bernanke will give his annual Jackson Hole speech. Anticipation is running high that Bernanke will use the opportunity to present a new plan to boost the economy. Last year, Bernanke used his speech at Jackson Hole to lay the groundwork for the second round of quantitative [...]
Forty Years After the End of Gold-Backed Money
Monday August 15 marked the 40th anniversary of former President Richard Nixon’s decision to cease gold-dollar convertibility, effectively ending the gold standard once and for all. Since then, the global economy has existed solely in the realm of fiat currency. Following the Second World War, the United States and its allies created the Bretton Woods [...]
China, Copper, and Foreign Exchange
Copper posted a 2011 low of around $3.83/pound in mid-May. Since then, the metal has come back to a recent intra-day high of slightly more than $4.19/pound, but that’s still nearly -13% below the 2011 high. Copper’s recovery is part of the reason that commodities in general have turned around. A fair portion of the [...]
Can Power Shortages in China Affect Commodity Prices?
Electricity output in China rose nearly 12% in the month of April, but that was not enough to meet demand. The blame is being put on rising prices for coal. Many of China’s coal-fired power plants are simply unable to find the cash to purchase sufficient quantities of coal. The central government’s crackdown on lending [...]
Dollar Bounces Up, Commodities Down
The decision by the European Central Bank to leave interest rates at their current level of 1.25% came as no particular surprise. However the comments from ECB president Jean-Claude Trichet following the decision roiled the currency markets. Trichet avoided the phrase “strong vigilance” with regard to inflation, choosing instead to say that the ECB would [...]
