Davos: We are not perma-bulls

John LaForge
Published on:

News of the death of the commodity bull market might be exaggerated, according to seven vital signs identified by Ned Davis analysts. But don’t expect a ripe old age for the bull either.

Calling the end to the decade-long commodity run was a popular thing to do in 2012. At one point in June, the average commodity had cratered – by 27% from June 2011 – prompting a chorus of comparisons to the peak and crash of 2008.

The main claim was that 2008 was the true secular peak and what we have witnessed since has been a false rally. The same pundits who proffered this opinion alleged that the 2012 price swoon was a last gasp, an aftershock of sorts, the final mark that the commodity move, which had started in 1999, was now dead. Since egg becomes nobody’s face, and Wall Street strategists are sensitive to such mishaps, the race was on to call the peak in commodities.

Unconvinced that we were looking at a commodity corpse, we spent oodles of energy in the back half of 2012 pleading...