Lower airfares, cheaper food and rising profit margins are among the
benefits that should flow from tumbling oil and commodity prices - but
only after a long lead time.
Having poured $400 billion into commodities over the past decade,
many investors are now selling. Their confidence that risky assets could
only float higher on a rising tide of cheap central bank money has
crumbled as the global economy fails to respond to the stimulus.
Even China, an important buyer of natural resources, is slowing.
Inflation, against which gold in particular is a classic hedge, is
falling nearly everywhere.
Price pressures will ease further if natural resources keep falling.
That is bad news for exporters such as Saudi Arabia and Brazil but good
news for net importers. (more)
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