BTU - One Week Update - Commodities Secular Bull

One data point does not make a trend, but it is worth noting that BTU increased 2.7% this last week while the broader averages (DOW) increased 2.3%.

This makes the last post of noting the rhyme between an old tech bellweather to a new energy bellweather more relevant. Peabody Energy a bellweather? The U.S. is to coal what Saudia Arabia is to oil.

It is easy to reflect back to the two decade run of the techs and think how easy it was to enjoy the ride. In fact from the early 80's it took a couple of years to recognize the new bull market 1982-1984; then it was interrupted in dramatic fashion in 1987; met with a recession in 1991-1992; and saw two financial crisis in 1994 and 1997. The lesson learned was to buy the dips; the ride was going to be a long one.

In 1998 Jim Rogers started a commodity index and made the bold prediction that the following two decades were going to be the era of commodities.

The graph below compares the 1982 Dow Bull with the 1998 Commodity Bull (with the time axis showing the current Commodity Bull).