2008 Commodity Performance

No asset class has experienced a roller-coaster ride like commodities have in 2008.  Below is a table with the performance of ten major commodities over the last year.  For each commodity, we highlight its current year-to-date change, its drop from its 52-week high, and its performance from the start of the year to its 52-week high.

As shown, oil has fallen the most from its highs at -75%.  Oil is trailed by copper (-70%), platinum (-61%), and natural gas (-57%).  Oil is also the commodity that is down the most year to date at -62%.  Of the ten commodities highlighted, gold is the only one that remains up on the year with a gain of 3.87%. 

The crazy thing is that these commodities looked to be headed towards record positive years just a few months ago.  At its peak, natural gas was up 83% on the year, but it is now down 22% in 2008.  Oil was up 53% for the year before falling more than $100 from its highs.

As hectic as the stock market has been this year, commodities have been even more volatile.

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Comments

[Ella]

This was interesting, people who are into commodity investing would be a little alarm but not that much if they have the right thing to do.this information help a lot.

[Ella]

This was interesting, people who are into commodity investing would be a little alarm but not that much if they have the right thing to do.this information help a lot.

[Ella]

This was interesting, people who are into commodity investing would be a little alarm but not that much if they have the right thing to do.this information help a lot.

[Ella]

This was interesting, people who are into commodity investing would be a little alarm but not that much if they have the right thing to do.this information help a lot.

[Doug]

Money---Supply, Velocity, and Loss of
We all know that the money supply has been increasing, and many have been surprised at the decline in prices that has accompanied the recent "growth" of the money supply. We all know that inflation is a monetary phenomenon, Right? Yes that is right, but lets take a closer look at what is happening with the money supply and the velocity of money. If inflation is a monetary phenomenon and money supply is increasing, why aren't we already seeing inflation? During the time that the money supply has been growing the velocity of money has been declining---at an alarming rate. Why has the velocity declined. Financial innovations---such as those nasty Collateralized Debt Obligations (CDO's) increased the velocity of money. These innovations were "productively" increasing the velocity of money when they were created and when all was well with their value. As the credit crisis evolved--we had to unwind all of the "productivity" that was gained through the use of these "darling turned ugly duckling instruments". This unwind took its toll on the velocity of money and the real damage will be the unseen damage that is yet to come. What unseen damage? The damage that will be done as the velocity of money declines as these instruments are "cleaned up". The decline in velocity caused by the unwind of these instruments has contributed to the false sense of "deflation" that has gotten so much attention from many "talking heads" lately. We know, through both common sense and historical numbers that the velocity of money declines during recessions---sometimes sharply. During a NORMAL economic cycle, the decrease in velocity would be normal as central banks would increase the money supply, get the economy going again and then the velocity would again rise.
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[Penny Stocks]

This is such an important topic, thank you so much for sharing.