The Australian move to raise interest rates sparked a surge in commodity prices, led by agricultural futures.Why is this?

The interest rate hike signaled that "all is well" in world economies, at least for the time being. So, if deflation is on the run, inflation can take over and that is happening in spades in the futures markets. Let's look at some prices:

• December wheat is at $4.63 per bushel up 20.2 cents (each penny equals $50.00)
• December corn is $3.64 per bushel, up 23.2 cents
• November soybeans are at $9.07 per bushel up 22.4 cents
• November crude oil is at $71.73 per barrel up $1.32
• December S & P is at 1052.50 up 16.10
• December Dow is at 9673 up 127
• October cattle are at 82.40 down .275
• October hogs are at 49.97 cents per pound up .925
• December gold is at $1044 per ounce up $26.60 (each $1.00 equals $100 dollars)
• December silver is at $17.43 per ounce up 89 cents

As commodity indexes surged to record highs Tuesday, an economist and analyst offered time-tested advice on the macroeconomic and portfolio implications of the market's latest investment obsession of the moment.

Economist Glen Langan told BloggingStocks Tuesday that the steep climbs in soybean, wheat, platinum, coal and gasoline all speak to, for the most part, a secular trend that the world's major economic regions will have to address at some point: rising commodity prices that outstrip the developed and developing worlds' ability to absorb those price increases.

Langan said demand for commodities and raw materials remains above average, even as prices have risen, due to strong emerging market economic growth. Typically, after extended bull runs, either demand recedes or prices drop. Prices, so far, haven't dropped. The UBS Bloomberg Constant Maturity Commodity Index gained as much as 2.8% to 1,441.593, the highest ever, Bloomberg News reported Tuesday. "So unless we've suspended a law of economics, growth in these regions has to slow, at least somewhat," Langan said.