What Does Copper Really Indicate?

Copper ($HG_F) prices were always a leading indicator for the direction of the US economy. Because the economy was so dependent on building growth, markets watched copper to see how much was being used. More use supposedly meant more growth.

That isn’t the case today.

The big mining companies stocks ($FCX, $SCCO, $WRN, $FSIN) are still affected by the copper price. However, it’s not the US that is driving it. Copper is a proxy on the Chinese economy.

Check out copper prices ever since the news that the Chinese economy might be on the bubble. They have dropped. Meanwhile, stories of problems in China don’t abate. As with most governments, economic growth has papered over their warts. When the merry go round stops, all the trash falls off.
GLOBAL X COPPER MINERS ETF Stock Chart

GLOBAL X COPPER MINERS ETF Stock Chart by YCharts


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

You might be interested in:
blog comments powered by Disqus
Points and Figures Blog