We have been focused on the price of oil since the middle of June. There is now question that there is more supply now then there has been in a long time. The big issue is demand is way off. Commodities are down across the board. For example, in China a ton of rebar is cheaper than a ton of cabbage.
But demand for commodities has slowed down worldwide. Look at what’s going on in Europe. Now people like George Soros are saying, ‘Europe has to do more.’
And the stock market in the United States rallies every time there is a hint of halting tapering and continuing on with record low interest rates. The saying used to be, ‘So goes the United States, so goes the world.’ But now you can substitute China in place of the United States, and right now China is in a real estate slump. Real estate prices declined over 10 percent in the first half of this year in China.