Explanations for commodity price levels (or movements) commonly focus on the fundamentals of supply and demand; otherwise they are simply assigned to speculative activity. Comparisons of metal price histories to monetary and other economic data support the argument that the supply of and demand for money are no less important in the determination of price than are the supply and demand of the commodity itself That these relationships should exist is evident in the price identity and they are consistent with monetary theory. The patterns developed have limited usefulness as predictors, but their recognition is essential for the construction of price scenarios for planning purposes.
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