Dicker: Don't Treat Commodities Like Stocks

This post appeared earlier today on RealMoney. Click here for a free trial, and enjoy incisive commentary all day, every day.

Bubble? Manipulation? These words are being bandied about by the financial press but have absolutely no meaning in the context of the commodity markets right now.

In trying to understand the quick rise (and falls!) in the prices of commodities such as oil, corn and wheat, many of this country's most respected economic journalists have used the typical models of other markets. That's just wrong, because the futures markets do not operate like any other market out there.

Let's discuss just what makes the commodity markets unique and why you cannot try to understand their prices solely using traditional economic theory. Then, we'll hopefully be in a better position to try and predict where they're going. ...