Introducing the iron ore equities “idiocy spread” (members)

Monday, 25 August 2014

‘Tis a slow news days today and perhaps I’ve got too much time on my hands. Then again, I may have just had an epiphany.

I am referring to my new iron ore indicator, the “idiot spread”. Rebar futures have opened the better part of 1% down in China and Dalian iron ore futures are down another half percent as well. Local iron ore miners are falling sharply and juniors remain quite sickly, though not as terminal as they should:

The majors, however, remains far above where they were the last time the iron ore spot price was at these levels, and hugely above the 2012 crash:

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.