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Diverging price trends for commodities and stocks also have some analysts fearing a slide.
This follows from different compositions of commodity specialization regarding metals, food and oil and their diverging price patterns over time.
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The diverging prices reflect the fact that while oil and natural gas can substitute for each other in some uses, the markets for the two products are very different.
The economist Dean Baker was showing me graphs of home prices diverging from rental prices in a novel and scary pattern back in 2002!
The study, by the Smith Institute thinktank, warns of disastrous economic and social consequences from rapidly diverging house prices, and argues that the disparities are entrenching wealth and income inequalities between regions.
Normally, W.T.I. and Brent have diverged in price by only a couple of dollars.
This trend has already been seen as large cap tech companies diverge in price from the broad market.
As a consequence, internal relative prices diverged from international market prices, thus generating a sharp differential (which put the agricultural sector at a disadvantage) between the internal and external terms of trade (see Díaz-Alejandro 1970; Mallon and Sourrouille 1975).
But prices often diverge from cost and value and, in those cases, taxes can actually help steer resources toward more highly valued uses.
Or traders could be betting on speculation – buying up Mr. Romney's stock, for example, in the hope of selling it at a higher price later, even if that price diverged from their estimate of the "fundamentals" in the race.
American prices have risen by less than those in Britain, yet this is still by far the biggest boom in American history, with real gains more than three times bigger than in previous housing booms in the 1970s or the 1980s.The most compelling evidence that home prices are over-valued in many countries is the diverging relationship between house prices and rents.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com