Tuesday, August 7, 2012
Dr. Copper Prescribes Ritalin for Stocks
Copper, which is far less prone to emotion, speculation, and Central Bank manipulation, has a different out look on the global economy than stocks. In the chart below, in both prior instances when copper topped out, stocks continued on briefly to new highs but then succumbed ultimately in the direction of copper (down). Now, on the other side of point (3), the divergence between stocks and copper is enormous compared to the prior instances. Meanwhile, the fact that copper has gone from the upper left to the lower right quadrant is yet another roundly ignored sign of global deflation and impending recession.