Prices, Unemployment, and the Global Economy
Prices, Unemployment, and the Global Economy
By Elliott R. Morss
Looking only at prices, it appears the global economy is recovering.
Consider first stock prices. The following table indicates that while most stock markets have not fully recovered, they have come back a long way from their lows.
Table 1. – Stock Market Prices
|
Index |
Index |
Hi-Low |
Index |
Hi-Now |
Percent |
|
| Index |
High |
Low |
% Loss |
Now |
% Loss |
Recovery |
| Colombia (IGBC) |
11439 |
6461 |
-44% |
11693 |
2% |
105% |
| Argentina (Merval) |
2339 |
829 |
-65% |
2333 |
0% |
100% |
| Chile (IPSA) |
3499 |
2101 |
-40% |
3465 |
-1% |
98% |
| Mexico (Mexbol) |
32721 |
16869 |
-48% |
31017 |
-5% |
89% |
| Brazil (Bovespar) |
73516 |
29435 |
-60% |
67413 |
-8% |
86% |
| Venezuela (IBVC) |
62013 |
34172 |
-45% |
54111 |
-13% |
72% |
| Peru (IGBVL) |
23790 |
6054 |
-75% |
15733 |
-34% |
55% |
| TSX (Canada) |
14984 |
7591 |
-49% |
11173 |
-25% |
48% |
| S&P 500 (US) |
1558 |
683 |
-56% |
1059 |
-32% |
43% |
| Shanghai (SSE Comp.) |
5818 |
1729 |
-70% |
3372 |
-42% |
40% |
| S&P Asia 200 |
6749 |
3145 |
-53% |
4540 |
-33% |
39% |
| DJ Eurstoxx 50 |
4543 |
1810 |
-60% |
2763 |
-39% |
35% |
| Bombay (^BSEN) |
20687 |
8757 |
-58% |
11403 |
-45% |
22% |
| Nikkei 225 (Japan) |
18239 |
7569 |
-59% |
9844 |
-46% |
21% |
The markets are ranked on how much they have recovered. The performance of the Latin American markets is most noteworthy.
As Table 2 shows, many commodity prices are also recovering.
Table 2. – Commodity Prices
|
Index |
Index |
Index |
Hi-Low |
Hi-Now |
Percent |
|
| Index |
High |
Low |
Now |
% Loss |
% Loss |
Recovery |
| Copper |
8,71 |
3,1 |
6,3 |
-64,4% |
-27,7% |
57,0% |
| Cotton |
80,2 |
51,5 |
66,8 |
-35,8% |
-16,7% |
53,3% |
| Agriculture Raw Materials |
122 |
81,66 |
101,5 |
-33,1% |
-16,8% |
49,2% |
| Lead |
3772 |
968,2 |
2227 |
-74,3% |
-41,0% |
44,9% |
| Oil |
131,2 |
41 |
73,3 |
-68,8% |
-44,1% |
35,8% |
| Tin |
23,85 |
10,69 |
15,1 |
-55,2% |
-36,7% |
33,5% |
| Hard Logs |
326,9 |
263,2 |
277 |
-19,5% |
-15,3% |
21,7% |
| Nickel |
51,78 |
9,84 |
18,4 |
-81,0% |
-64,5% |
20,4% |
| Soybeans |
554,1 |
318,8 |
354,9 |
-42,5% |
-36,0% |
15,3% |
| Natural Gas |
456,6 |
107,5 |
144 |
-76,5% |
-68,5% |
10,5% |
| Coal |
192,9 |
65,4 |
76,1 |
-66,1% |
-60,5% |
8,4% |
| Uranium |
136,2 |
41,7 |
46,1 |
-69,4% |
-66,2% |
4,7% |
| Wheat |
439,7 |
191,1 |
198,8 |
-56,5% |
-54,8% |
3,1% |
Source: http://www.indexmundi.com/commodities/
Clearly, the speculators are back playing and profiting in the markets.
But are “things” being bought that put people back to work? Clearly not enough things are being bought. The number of unemployed people in Western nations continues to rise. Admittedly, unemplouyment is a lagging indicator: firms are reluctant to hire until they are sure the recovery is for real. But until unemployment stops rising, there has to be considerable uncertainty about how solid the recovery will be….
