BRKY - DBA: The Growth Shock Appears To Be Here

• At the beginning of the month, we underestimated how fast agricultural commodities would follow base metals down.
• Although there are good reasons to buy agriculture ETFs as a hedge against geopolitically induced food inflation, DBA is too underexposed to grain commodities to perform that role adequately.
• Many of these risks are likely already priced in, and without knowing what the equilibrium prices for commodities are, hedging at this stage in a commodity cycle is a gamble.
• The history of agricultural commodities points to long-term weakness.
• Historically reliable indicators suggest negative agricultural returns well into 2023 and outperformance by both Treasuries and gold.

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