The question that I am still asked most frequently is, “So what do you think cotton prices are going to do?” Naturally, my answer usually lies somewhere between “I wouldn’t tell you if I knew” and “What drawer did I put that crystal ball in?”
In reality, while I am entirely unsure of exactly how much a significant event (or more usually, the net effect of thousands of events happening simultaneously) will affect cotton prices, I am much more certain of identifying events that may or may not be significant.
For example, if you buy a 100 percent cotton dress shirt this weekend, will that action affect the dollar price of cotton? The answer is yes, because it increases the demand for cotton and, ceteris paribus (all other things being equal) will make cotton prices increase. However, nobody is analyzing or talking about your weekend purchase, because ceteris paribus is not reality. The purchase of one little shirt will not have enough of an effect on prices to matter.
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