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Note: We ran this earlier this morning before the commodity crash. Now it’s especially relevantOriginal post: Analysts at GaveKal Research have come up with a really great list of 5 reasons commodities are suddenly starting to slide.
Here’s our summarized rundown:
- The Glencore IPO has everyone thinking this is a Blackstone-like top in the commodities market. (Josh Brown has been all over this one)
- The fact that silver is sliding even with a weak dollar reminds everyone that all commodities are vulnerable.
- Across all markets, “leadership” is narrowing. (See our recent COTD).
- Fiscal stimulus is being removed in China. (See this report from China).
- A recent IMF report indicated that Asia-Pac is still very early in the tightening cycle, and still generally in an expansionary fiscal position that needs to come down.