A New Way for You to View Commodities

Over the past year or so, one of the biggest stories in all of finance is the soaring price of basic commodities like cotton, crude oil, coffee, corn, and soybeans. Many of these raw materials have soared 33%-50% in price since last summer.
 
But make sure to keep in mind that there are always two sides to a “price.” There’s the service, asset, or product we measure on one side, and there’s the “measuring unit” on the other. The seasoned investor always keeps this in mind when sizing up opportunities and risks.
 
In the case of commodities, remember they are priced in dollars. As many DailyWealth readers know, the dollar is a huge, grinding, long-term bear market… which causes our colleague Porter Stansberry to say we aren’t “facing” a dollar crisis, we are “in one right now.”
 
The dollar’s weakness is causing a major distortion to one side of the commodity price equation. Sure… oil and food are soaring when you measure them in dollars, but what if you measure them in “real money,” aka gold? Today’s chart gives you the answer…
 
Our chart displays the benchmark commodity index measured in gold terms over the past 18 months. As you can see, commodities have actually decreased in price when measured in gold. The “raw materials rising” story is more of a “dollar falling” story. The trend of “real money” outperforming “paper money” continues…