Record setting commodity prices are only partially driven by actual or perceived supply constraints. The Fed is another factor. The falling Dollar has added momentum to the surge into crude and gold. Failure to restrict gas guzzling motor vehicles, together with the ethanol push, is hurting consumers with higher food and energy costs. Geopolitical tensions are also pressuring oil and gold.
As the US enters recession, soon to be followed by the “rest of world”, logic would say that commodity prices will start to retreat. Yet Wall Street continues to emphasize commodity trading, driving prices still higher.
Crude has been on the rise since 2003, the year Uranus entered Pisces (until March 13, 2011). Pisces rules oil. The sign Uranus is in relates to trends that escalate to bubble levels, only to crash before leaving that sign.
Saturn in Leo (July 2005 – September 1, 2007) began the rise in gold, a Leo-ruled metal. Ag prices really took off around the time Saturn entered Virgo (September 2, 2007 – July 21, 2010). Virgo rules consumer staples, what a person needs to survive. Since Saturn has been in Virgo, there has been a marked increase in food and energy inflation worldwide.
Saturn in Virgo will exactly oppose Uranus on 11/4/08, 2/5/09, 9/15/09, 4/26/10, and 7/26/10. Commodities could get extremely volatile around those times, with wild spikes up or down. The bubble will probably burst at the latest by the last quarter of 2010. Ag commodities will probably be the last to fall as Saturn in Virgo creates constraints on food supplies due to adverse weather conditions along with contamination.