Thinking about copper.
Copper, which seems to be showing some early signs of wobbling in the face of tighter monetary policy and associated slowing global demand, might well be in deficit long run, but it is not as if the supply has been idle, or contracting, or unresponsive…
Which is doubly impressive given nearly every second worker has been COVID impacted over the past 2 years.
What’s the point?
Well, I think a lot of people just assume really high commodity prices must tell us that supply is inadquate. Maybe so, but perhaps not as inadequate as people think.
The cure for high prices is high prices, and the incentive to bring on new supply that it engenders.
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