Why Copper’s Stall at $3.63 is Ominous

by Rick Ackerman

Copper prices are up 75% since cratering in March at $1.97 a pound. Since ‘doctor’ copper, with a supposed PhD. in economics, has a reputation for accurately predicting growth trends, does this mean a global boom is at hand? This seems most unlikely, given the vast expansion of public debt used to temporarily counteract the economic effects of the pandemic. The debt, many trillions of dollars’ worth, is the direct cost of supposed stimulus,which, as any idiot can see, has catalyzed asset inflation rather than real economic growth. Unfortunately, when the party ends there is no way we will evade repayment, even if it means depreciating the dollar to zero via hyperinflation. There is only one alternative, a deflation that would effectively cancel all debts with a wave of bankruptcies at every level of the economy: public, corporate and private. Neither path is palatable, but it is virtually certain that one or the other, or perhaps both sequentially, will occur, since our collective debts have grown far too large to repay with hard money.

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