Mike McGlone's commodity report

Michael McGlone's Commodity Perspective is out. Mike is the commodity director at Standard & Poors.

I'm hooked on this concise monthly report, because it:

• Illustrates changes in subindices and individual assets that are driving (or deviating from) changes in the headline index;
• Connects fundamentals to total returns;
• Explains asset interconnections;
  
• Reviews theories as to what's going on and why.

You need to read it right away when it comes out though. It's perishable.

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Ya se publicó el informe de Michael McGlone, Commodity Perspective. Mike es el director de commodities en Standard & Poors.

Estoy adicta a este informe mensual conciso, ya que:

• Ilustra cambios en subíndices y activos individuales que marcan la pauta (o se desvían) de los movimientos en el índice general;
  
• Conecta los fundamentales con los movimientos en los índices;
• Explica conexiones entre clases de activos;
  
• Repasa teorías acerca de qué sucede y por qué.

Recomiendo leer el informe cada mes tan pronto como salga. Es perecedero.

A commodity report that even I can understand

I wasn't sure how to start out. Should I justify myself somehow? I checked my friend Felix Salmon's first post on Condé Nast Portfolio.com. He just jumped in. I'm jumping.

I like good writing and I strive to understand commodity markets. So I was pleased to stumble upon a well written, pedagogical commodity market report: the Standard & Poor's Commodity Perspective - S&P CSCI. I read the January edition. It's obsolete by now but still helpful.

Author Michael McGlone assumes no expertise on our part. He tells us, for example, that livestock prices "generally have an inverse relationship with the primary feedstock, corn."

He's a big-picture analyst. He connects January commodity returns to the real economy, consumer price inflation, past returns, other asset markets, and ongoing analyst debates.

In his final paragraph, by directing our eyes to the past, he shows us the future:

In 1900, when the U.S. began to industrialize, per-capital annual oil consumption was about 1 barrel per person. By 1970, it was about 27. In 1950, Japan consumed about 1 barrel per person annually. By 1970, it was about 17. In 1965, South Korea consumed about the same 1 barrel per capital and by 2000, it was about 17. today, China and India consume just over 1 barrel of oil per person annually.