Friday, May 20, 2011
Paper vs Real: Exit From Normal, Ecological Economics, and Probabilistic Regimes in One Chart
A 20 year chart of the US 30 Year Treasury Bond vs. a broad commodity index is the occassion to make several macroeconomic observations. The comparison reveals how the purchasing power of the long-dated US Treasury Bond has fared against a basket of commodities over the period. Tracking the ability of the US Treasury bond, denominated in US Dollars, to maintain its viability as a capital storage unit is not arcane. Rather, it is central. All institutions and individuals eventually use financial assets to purchase energy, natural resources, and labor. | see: 30 Year Treasury Bond by Price vs. The Reuters CRB Index–CCI Continuous.