SUPER EXCITED ABOUT A SUPER CYCLE
There has been much talk over the past few months of a commodity super bull cycle having started. The likes of Goldman Sachs and JP Morgan and other analysts have stated that for several reasons commodity prices could be entering a decade or more up trend. The development of a true commodity bull cycle can take several years to develop but many appear to have made up their minds.
Long term commodity cycles have been witnessed for centuries and should not be confused with short lived booms which happen more frequently. There have been three commodity supercycles over the past 150 years. The Second Industrial Revolution between 1870 and, abruptly, ending in 1914 when the first world war started saw raw commodity prices improve markedly. The post–World War II economic expansion which lasted until the mid-1970’s saw unprecedented global growth which brought renewed huge demand for all commodities. The last commodity bull cycle started at the back end of the last century, after a couple of decades of depressed commodity prices and came to an end when the world went into recession after the banking crisis of 2007-2009 although it did linger on until 2011 when oil prices dropped from historic highs. It was largely due to the rising demand from emerging markets such as the BRIC economies and in particularly China.
Despite the global pandemic that has overwhelmed the world, there are many analysts who see the vaccine roll-out as the beginning of a commodity bull cycle. Its extent and size still undetermined although this has not deterred many from getting seriously excited.
THE SECOND INDUSTRIAL REVOLUTION BETWEEN 1870 AND, ABRUPTLY, ENDING IN 1914 WHEN THE FIRST WORLD WAR STARTED SAW RAW COMMODITY PRICES IMPROVE MARKEDLY.
4 | ADMISI - The Ghost In The Machine | Q1 Edition 2021
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