The ratio of the Commodity Research Bureau Total Return Index and the S&P 500 (TR) is basically the value of a standardized basket of commodities compared to the value of a basket of stocks - in simple terms how much stock you can buy with a fixed amount of commodities. It is noteworthy that:

• The 50-year average for this ratio is around 1.1 times
• During the commodity bull market in the 1970s, the ratio peaked at over 3 times
• The ratio is currently at a 50 year low of around 0.2 times far below the long-term average and just slightly higher than the low reached around 2000. In other words, we are still at a very low relative valuation between "hard assets" vs. "stocks."
• Logically, the ratio of hard assets to stocks should move higher before the commodity bull market is over
• If this occurs, it will be as a result of either stock value falling and/or commodity prices rising - most likely it will be a combination of both as investors rotate out of stocks into commodities as the bull market unfolds