I’ve been talking about the rise in commodity prices for a while now (CRB raw industrials sub index was up yesterday for the 8th day in the past 9 to less than 1% from record high) and some of it is definitely currency debasement but the emerging market thesis of a growing middle class remains the dominant theme as 85% of the world’s population is not in the developed world. Some think decoupling is not possible, especially after what was seen in ’08-’09 when it badly failed but look at the stock market closes overnight, the South Korean stock market closed at the highest level since May ’08, the Sensex at the highest since Jan ’08, the Thai index at the highest since ’96, Jakarta index at an all time record high, Singapore Straits at just shy of highest since June ’08 and the Philippine index closed just below a record high. The Euro is at a 5 month high notwithstanding continued weakness in PIG debt after Germany’s IFO confidence rose.
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