There are many expensive assets in the world today. The past decade of ultra-light monetary policy and the pouring of money from central banks has created the infamous “ubiquitous bubble”. This is one of the reasons why we now have a weird yo-yo investment environment in which everything is rising simultaneously – from risky stocks to safe gold.

One thing remained reliably cheap – the raw materials. While the US stock market, which continues to hit new highs, is nearly as expensive as it has been in the last 150 years, commodities are almost as cheap as stocks over the last 100 years.

Part of that is natural – and structural. Over the last 200 years, the real price of manufactured goods has been moving down. This is because every time a new price spike disrupts what is usually a long-term bear market, businesses and consumers adapt. They can replace more expensive raw materials with cheaper ones, develop technologies that allow for more efficient extraction, or – notice, try to conserve energy. Thus, Jimmy Carter’s presidential appeal amid an energy crisis against Americans to reduce their thermostats, which he makes from the White House while wearing a thick waistcoat.

With the exception of a few jumps, industrial commodity prices have fallen since the S&P 500 index.

In the deflationary world, at the end of the recovery cycle, with an aging population consuming less and a world economy less dependent on the energy-intensive industry than services, there are many factors that keep raw materials cheap, even if no recession has occurred in the US or the rest of the world.

These factors add to the escalating conflict between the US and Iran, as well as global pressure for more proactive climate action. The latter may not be a priority for the US administration, but it is young activists who make up a growing share of voters.

Like most CEOs, economists and politicians, younger generations believe that abandoning fossil fuels is inevitable. Investment circles are even talking about oil tankers, which are turning into “troubled assets”, whose value will decline rapidly as renewable energy will take center stage.

And yet, after watching the last strong demand-driven oil spike in 2008, and the more fuel-induced one in 2011-12, which eventually turned when the central bankers withdrew from quantitative easing, I think that it is unreasonable to assume that we have entered a permanent bearish commodity market – at least not yet.

The rising threat of unfunded retirement and health liabilities in the United States, coupled with the desire of central bankers and politicians to try to accelerate inflation through money printing – thus weakening the dollar – could turn gold into the hottest new asset class the next few years. Some of these trends could also lead to an increase in commodity prices as a whole, although the prospect of a broader war starting in the Middle East has not yet created a steady jump in oil prices.

There are many reasons – from deficient spending through political risk to the bursting of the corporate debt bubble – the dollar weakens. If that were the case, commodities moving back into the green currency would be appreciated in dollar terms. The US stock market is likely to decline as corporate margins are scrapped and there are not many buffers against rising energy and commodity prices. If the dollar becomes cheaper, all costs for overseas supply chains will also increase.

If that happens, there is little doubt that the Federal Reserve will try to support the market with further monetary easing. Given that every central banker in the world tells us that monetary policy cannot support the market forever, it is possible that such a move will not trigger a further rise in stocks, but an escape to gold and perhaps to a commodity asset class, such as a whole.

Quantitative easing is a major factor in the recent rise in prices of industrial goods, which are not only raw material for business but also tradable assets for speculators. This is a theory that is currently being touted by some inertial investors.

This scenario will only come to fruition if there is no significant slowdown in global growth that will change the mainstream demand picture. Things may go the other way, especially if growth in Europe or China begins to fluctuate with that of the United States.

However, if raw material prices really go up, there will be countless consequences. We will see oil leaders encouraged and populist nationalism increasing globally because inflation in food and fuel prices will hit the poorest, fueling political instability. This, in turn, could create new trade turmoil and the kind of disruption that markets are currently calculating.

On the other hand, demand for raw materials is price elastic – as prices go too high, demand always falls. The cycle of replacing one energy source with another has been repeated for hundreds of years. In an ideal world, the next raw material bubble, whenever it comes, could help us make the last change – abandoning fossil fuels in favor of renewable energy.