What happened to the commodity super cycle?

The theory of the commodity super cycle I believe is flawed in some senses. I remember in mid 2000s, there were analysts saying how oil would someday be $300 per barrel and never go down. The reality is that the rules of economics will always trump these cycles and balance will return.

After the dot-com, 9/11 slowdown, we saw massive interest rate cuts, tension in the middle east, housing, property and BRIC boom that saw demand for commodities increase with decreased supply. That triggered the rush into betting up commodities. Then you had cartels which control these commodities use these high prices to their advantages. OPEC keeping supplies limited, China putting shipping restrictions on Rare Earths to Japan under the context of historical disputes etc.

The thing is, when something is so expensive, the response in the market will push back. People bought energy efficient cars, manufacturers designed more fuel efficient vehicles, Hitachi develops an engine that doEsnt require Rare Earths, fracking and horozontal drilling is developed, oil is found offshore of Brazil etc etc etc. China slows down, property busts occur world wide, Cartels lose control as increased spending on the populace to keep citizens happy becomes more expensive and requires more now-cheaper oil to sell etc.

I believe oil could stabilize, but we cannot read the future. Nothing always keeps going up or down. We will probably always have a need for oil, but how much will always be a guess. We should not discount the ingenuity and the ideas of people. Push always leads to shove.

alanbrenton wrote: ↑Seems commodities peaked in 2011 in general, except for oil that went bust last year.

When do we expect the super cycle to resume its upward trajectory and what would be some catalysts besides China's GDP growth?

As long as USD keeps rising like right now, all commodities will flounder. Cycles like commodities usually come back every fifteen years.

Gingercookie wrote: ↑As long as USD keeps rising like right now, all commodities will flounder. Cycles like commodities usually come back every fifteen years.

Yes.