While crude and copper have been christened the great economic forecasters of our time, the data shows that there is another, more highly correlated, commodity to the economic cycle [6]. Lumber prices are the most correlated with ISM and GDP of all industrial commodities and that is a problem...
First, Lumber prices have collapsed to 4 year lows. The 33% Year-over-year plunge is the biggest since the financial crisis and is flashing a big red recession alarm...
[7]
Second, Lumber prices have historically led stocks and are pointing to significant downside from here...
[8]
and finally, Third, it appears lumber's decline points to notable downside for manufacturing...
[9]
But apart from that, everything is fine... Oh wait...
[10]
Charts: Bloomberg and @Not_Jim_Cramer
