According to the Labor Department, the Consumer Price Index for August was negative for the first time in over a year. The official September figures won't be released Oral Steroids Poison Oak until the 22nd, but several international and global reports have suggested that prices are declining all over (in a very broad and general sense).
Changing dynamics in commodities are driving a lot of these deflationary movements. This shouldn't be particularly surprising given the intersection of high commodity profits and low interest rates over the past decade, Kamagra 100 making capital intensive expansions relatively low risk. Now, as you'd expect from a basic economic understanding, margins are shrinking and investors are finding fewer opportunities in food and fuel.
You can quibble with the Bureau of Labor Statistics treatment of both food and fuel prices in measuring CPI, but it's clear that total costs of living are declining on the back of cheap wheat, grain, dairy products, and oil.
The obvious policy impact of declining prices is that the FOMC will feel more comfortable keeping an easy money policy and continuing to Primobolan For Trt suppress interest rates. Stocks will like this, generally, and treasury bond yields will continue to shrink in the short term.
But what do these changing variables mean for food and energy markets on the whole? I'd say it's time to stock up on 4-chlorodehydromethyltestosteron your meats and wait for oil to present an opportunity once the snow starts to melt next year.
There's a lot of supply in foods and petroleum hitting global markets, and even some evidence to suggest slacking demand in two developing giants (India and China). Large financial institutions, such as Barclays and Bank of America have been reducing exposure to the commodities sector over the past months. Per Bloomberg, commodity related profits among top 10 banks was almost $10 billion less in 2013 than in 2008.
A report from the United Nations' Food and Agriculture Organization (FAO) price index shows that global food prices have fallen for the fifth consecutive month. Compared to last year, the index which tracks meats, dairy, cereals, sugars and select other goods has dropped by nearly four percent since July, and those declines are much higher if you exclude meats.
Crude oil prices have dropped by nearly 1/5th since June, and now stand at their lowest levels since late 2010. In a very micro sense, this has negative implications for firms that have expanded operations on the assumption of $100 / barrel oil. Producers saw record profits during the mid 2000s, making it suddenly feasible to extract oil from hard to reach places (techniques such as horizontal drilling, fracking and shale oil extraction exploded) especially in the United States, where production climbed in a significant way for the first time since the late 1960s.
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Cheaper oil and food is obviously a boon to consumers. For investors and fund managers who have ridden on the back of energy stocks, however, the news isn't as pleasant. This is where hedging strategies are worth their weight in gold (which has also seen prices drop lately, incidentally).
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As you can see, the up trend in crude broken earlier in this year Primobolan 1ml than in 2013. Oil is notoriously hard to predict on an annual basis because of how sensitive prices are to global conflict, but it is possible that we've reached a point where production is going "Achat Anabolisant Belgique" to more than compensate for that uncertainty in the near future.
Of course, the rise of bio fuels has created a stronger link between agriculture and energy markets. With wheat, corn, and grains becoming more abundant (despite tension in Ukraine), and with standard gasoline prices declining, alternative energy stocks and funds are likely to suffer. We've already seen sharp declines in companies such as FutureFuel Corp. (NYSE:FF), whose share price is now half of its peak earlier in the Cialis 10 Mg Goedkoop year.
Watch out for the reactionaries, though; there mere thought of oil's golden age coming to an end will likely lead to overselling. There is clearly a bear market in oil, but we will have some buying opportunities for 2015, especially for companies that haven't overextended into more expensive operations.
The same is true of biofuels, but perhaps only because of increased government regulations and public investment in gasoline alternatives. There will eventually be another oil threatening political situation, and there are still plenty of Asians who need cars. Oil prices aren't going to drop permanently. Biofuels may never fulfill their promise, but don't write them all off just yet.
As for foods: there were still food groups in Investor's Business Daily's "top 10" industry group list, notably Food Meat Products. This makes "Anabolika Definition" sense, given that the UN's meat index was the only sub category not to lose significant value in 2014 so far. Also keep an eye on big time candy providers for the holiday season, like Hershey (NYSE:HSY), which can take advantage of reduced sugar prices is already paying solid dividends.