Was Globalization Driven by Commodities Demand?

Project Syndicate: The End of Globalization?
Because food, fuels, and raw materials comprise about a quarter of global trade, when their prices fluctuate – especially as strongly as they have in recent decades – aggregate trade figures are obviously affected. Given the massive drop in commodity prices lately, there is little need to seek any other explanation for the recent slowdown in trade.

...When something is widely hyped, there is nearly always a real reason for it. Most economies are more open today than they were a generation ago. But it is now becoming clear that the perception that globalization is some overwhelming and inexorable force largely reflected the side effects of the last decade’s commodity boom. If prices remain low, as seems likely, the next decade might well see global trade stagnate, as the trade pattern “rebalances” from emerging economies to the established industrial powers.
Although credit kept growing around the world, the pace slowed markedly after the various stimulus efforts wore off. The financialization of commodities, such as the copper hoarding in China, was also a major direct link between commodities and money. Investors bought commodities as a store of value, but the demand for commodities as a money substitute has almost collapsed outside of gold, which is trading at or near highs in many currencies.

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