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  • Predicting the Markets Chapter 15 Charts:

    Predicting Commodities Yardeni Research, Inc.

    November 2, 2016

    Dr. Edward Yardeni 516-972-7683

    eyardeni@yardeni.com

    Mali Quintana 480-664-1333

    aquintana@yardeni.com

    Please visit our sites at www.yardeni.com blog.yardeni.com

    thinking outside the box

  • Table Of Contents Table Of ContentsTable Of Contents

    November 2, 2016 / Chapter 15 Charts: Predicting Commodities www.yardeni.com

    Yardeni Research, Inc.

    Predicting Commodities 1-17

  • 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 70

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    CRB RAW INDUSTRIALS SPOT PRICE INDEX* (1967=100, ratio scale)

    11/1

    * Weekly from 1951 to 1981, daily thereafter. Includes copper scrap, lead scrap, steel scrap, tin, zinc, burlap, cotton, print cloth, wool tops, hides, rosin, rubber, and tallow. Note: Shaded areas denote recessions according to the National Bureau of Economic Research. Source: Commodity Research Bureau.

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    Figure 1.

    95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 200

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    C

    11/1

    CRB RAW INDUSTRIALS SPOT PRICE INDEX* (1967=100, daily)

    C = China enters World Trade Organization. * Includes copper scrap, lead scrap, steel scrap, tin, zinc, burlap, cotton, print cloth, wool tops, hides, rosin, rubber, and tallow.

    Source: Commodity Research Bureau.

    yardeni.com

    Figure 2.

    Predicting Commodities

    Page 1 / November 2, 2016 / Chapter 15 Charts: Predicting Commodities www.yardeni.com

    Yardeni Research, Inc.

  • 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 30

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    Dec

    SepSep CHINA INDUSTRIAL PRODUCTION* (2005=100, sa)

    * Value added basis. Source: IMF International Financial Statistics.

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    Figure 3.

    1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2

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    CHINA REAL GDP & INDUSTRIAL PRODUCTION (yearly percent change)

    Real GDP (6.7)

    Industrial Production* (6.1)

    * Value added basis. Source: Haver Analytics.

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    Figure 4.

    Predicting Commodities

    Page 2 / November 2, 2016 / Chapter 15 Charts: Predicting Commodities www.yardeni.com

    Yardeni Research, Inc.

  • 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 200

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    11/1

    CHINA INDUSTRIAL PRODUCTION & INDUSTRIALS COMMODITY PRICE INDEX

    China Industrial Production* (yearly percent change)

    CRB Raw Industrials Spot Price Index** (1967=100)

    * Value added basis. ** Includes hides, tallow, copper scrap, lead scrap, steel scrap, zinc, tin, burlap, cotton, print cloth, wool tops, rosin, rubber, hogs, steers, lard, butter,

    soybean oil, cocoa, corn, Kansas City wheat, Minneapolis wheat, and sugar. Source: Commodity Research Bureau and Haver Analytics.

    yardeni.com

    Figure 5.

    2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 100

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    11/1

    CHINA INDUSTRIAL PRODUCTION & COPPER PRICE

    China Industrial Production* (yearly percent change)

    Copper Futures Price** (cents per pound)

    * Value added basis. ** Nearby futures contract.

    Source: Haver Analytics.

    yardeni.com

    Figure 6.

    Predicting Commodities

    Page 3 / November 2, 2016 / Chapter 15 Charts: Predicting Commodities www.yardeni.com

    Yardeni Research, Inc.

  • 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 5

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    11/4

    CHINA REQUIRED RESERVE RATIO (percent)

    Required Reserve Ratio Large Depository Institutions (17.0)

    Small/Medium Depository Institutions (15.0)

    Source: People’s Bank of China.

    yardeni.com

    Figure 7.

    2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 5

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    CHINA M2 & BANK LOANS (yearly percent change in yuan)

    M2 (11.5)

    Bank Loans (13.0)

    Source: People’s Bank of China.

    yardeni.com

    Figure 8.

    Predicting Commodities

    Page 4 / November 2, 2016 / Chapter 15 Charts: Predicting Commodities www.yardeni.com

    Yardeni Research, Inc.

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    BALTIC DRY INDEX (1/4/85=100, daily)

    Source: The Baltic Exchange.

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    Figure 9.

    2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 100

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    11/2

    INDUSTRIALS COMMODITY PRICE INDEX & COPPER PRICE

    Copper Futures Price** (cents per pound)

    CRB Raw Industrials Spot Price Index* (1967=100)

    * Includes copper scrap, lead scrap, steel scrap, tin, zinc, burlap, cotton, print cloth, wool tops, hides, rosin, rubber, and tallow. ** Nearby futures contract.

    Source: Commodity Research Bureau and Haver Analytics.

    yardeni.com

    Figure 10.

    Predicting Commodities

    Page 5 / November 2, 2016 / Chapter 15 Charts: Predicting Commodities www.yardeni.com

    Yardeni Research, Inc.

  • 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 25

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    BOOM-BUST BAROMETER* (four-week average, ratio scale) 10/22

    * Weekly average of CRB raw industrials spot price index divided by initial unemployment claims, showing four-week average. Note: Shaded areas denote recessions according to the National Bureau of Economic Research. Source: Commodity Research Bureau and US Department of Labor.

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    Figure 11.

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    BOOM BUST BAROMETER* & BEAR MARKETS IN STOCKS (four-week average, ratio scale)

    10/22

    Note: Shaded red areas denote S&P 500 bear market declines of 20% or more. Yellow areas show bull markets. * Weekly average of CRB raw industrials spot price index divided by initial unemployment claims, four-week average, showing four-week average.

    Source: Commodity Research Bureau and US Department of Labor.

    yardeni.com

    Figure 12.

    Predicting Commodities

    Page 6 / November 2, 2016 / Chapter 15 Charts: Predicting Commodities www.yardeni.com

    Yardeni Research, Inc.

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    11/1 S&P 500 INDEX &

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