Steel prices are the lowest they have been in 15 years. In China it is cheaper than cabbage. Stainless and aluminum are also very low.
Oil is also bouncing around new lows.
A sharp drop in industrial commodities has some forecasting relevance. If it is confirmed by lower shipping rates, container imports, railroad utilization we could be facing a new recession. Business seems weak in many areas.
Three postings to read:
from National Review, Checkmate: The Economic Chess Masters Play a Losing Game by Kevin Williamson- the new realtionship wiring in our connected economy makes traditional econ math models far less reliable.
from Marginal Revolution, Quick thoughts on the new employment report by Tyler Cowen- wages and employment are subject to new dynamics
from Carpe Diem Today is Manufacturing Day, so let’s recognize America’s world-class manufacturing sector and factory workers by Mark Perry- the efficiency gains in manufacturing is one of those critical dynamics.
This chart from Mark Perry speaks volumes:
these changes provide a serious challenge to economic policy especially relative to wages and employment. It may be transition similar to the transition from agriculture to industry- a change that ignited the Progressive era. We may be on the verge of a new era that will require substantially different thinking than we are getting.