Mish's Global Economic Trend Analysis Message Board

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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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To: mishedlo who wrote (27864)	4/19/2005 3:00:28 PM
From: Tommaso	Read Replies (1) of 116555

Sugar has been mulling near its present pricing lows for perhaps the last 10 years. Even a doubling of current prices would still represent pricing 3 times less than the peak price periods experienced in the 1970s. There are other interesting aspects to sugar pricing that can be seen in the sugar pricing chart below. Note that during periods of time when the U.S. dollar depreciated (from 1985 for a few years thereafter) or when fuel prices increased dramatically (from the energy crisis in 1973-74) or when commodity prices in general rose higher (periods of the 1970s through 1980 and around 1994-95), sugar prices escalated dramatically. The current environment now in many ways can be characterized by some combination of all of these factors. It is also interesting to note that corn and sugar prices can soar to very high prices, even as the global economy goes into a recession – for example, from the 1968-69 to 1973-74 period, corn went up 295% and sugar went up 1290%. Therefore it is not impossible to conceive of a similar scenario playing out potentially in the near future, should the global economy slip into recession. etc etc financialsense.com

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