Expressed in gold, prices of oil and wheat haven't changed much.
And the correlations between commodities and US dollar increased to over -0.9 recently.
I am sympathetic to Steil's view and I see some parallel between the housing bubble and current commodities bubble.
In 2001, when economy was in recession and Greenspan Co. cut rates 11 times to 1%. Investors, lack of investment opportunities after dot.com bubble, all flocked to housing sector. Actually, housing was probably the only bright spot then.
In current cycle, Bernanke co. cut rates in a similar fashion, prolonging dollar's downturn, and investors again poured their money into the "safe haven" as a hedge both against inflation/US dollar and meager investment opportunities in a time of credit crunch, and twin crisis in both housing and financials.
