USCI

Goldman Sachs came out with a bullish report to investors last week predicting a surge in the price of commodities over the 2021-2025 period.Goldman see the stock market pullback in the face of rising anxiety over the spread of the COVID-19 pandemic as a temporary setback that will likely wane as the year draws to a close.Goldman's analysis of supply fundamentals and probable demand appears to be broadly accepted. However, views are mixed about when our decade-long low-inflation environment will end.

Global economic growth has underwhelmed versus expectations generally since 2011.Lower than expected growth versus expectations has caused investors to chase growth at almost any price, and duration in their bond investments almost at any price.This crowded investment landscape is about to experience a wholesale change, with global growth outperforming expectations led by China and the United States.

The dramatic move in commodities could be due to portfolio rebalancing at the end of the month, or it could be signaling that the recovery is running out of steam.Countries are doing QE to manipulate their currencies and get inflation, but their attempts to reflate their economies are instead resulting in inflated asset prices.U.S. equities are carrying out a bullish narrative of recovery as compared to poorer equity performance outside of the U.S.

•Stocks fall and oil retreats. •Natural gas corrected from a new high for the year. •Precious metals and copper remain strong. •Grains make a late season move higher. •The bull case for commodities remains compelling- RJI is another option for exposure to the asset class.