Gold Standard News Daily - Real Money Blog
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5.25.18 - Gold is Back as Geopolitical Tensions Rise
Gold last traded at $1,302 an ounce. Silver at $16.53 an ounce.
NEWS SUMMARY: Precious metal prices consolidated recent gains despite a stronger dollar. U.S. stocks traded lower as geopolitical uncertainty weighed on sentiment ahead of the Memorial Day holiday weekend.
Gold is back: The rise in geopolitical tensions boosts precious metal prices -CNBC
"Gold prices just had their best day in more than a month as renewed tensions with North Korea pushed investors into less risky assets. Trying times call for the safety trade, says one market watcher. 'It makes sense to hold it as a pure play because of all the geopolitical risk that's out there. It's still a calamity hedge,' Mark Tepper, founder and president at Strategic Wealth Partners, told CNBC's 'Trading Nation' on Thursday....Tepper also favors gold as a guard against stagflation, an environment where inflation reaches highs, economic growth slows and unemployment spikes. Tepper's research points to a recession in mid-2020 followed by a period of stagflation. 'During periods of stagflation, on average, the average holding period return of the S&P 500 (and these periods are like one- to six-years long) is 14 percent. The average return of gold in those same periods 85 percent,' said Tepper. Gold prices surged in the 1970s during the period that inspired the term 'stagflation.' Gold prices moved around 15 times higher over that decade, according to World Gold Council data."
The "Axis of Gold" Just Got Stronger -Rickards/Daily Reckoning
"As you're about to see, you can now expect what I call the 'Axis of Gold' to get even stronger. And it has potential to accelerate the demise of the dollar-based international system. The Axis of Gold includes Russia, China, Iran and Turkey...These countries are forming a trading and financial network revolving around gold and are acquiring massive amounts of physical gold to support it. They are steadily moving toward a gold-based balance of payment system. Why is this happening? Well, if you're on the receiving end of American sanctions like Russia, Iran or North Korea, you want a way to work around these sanctions. And gold is a powerful alternative....If a rogue state wants to acquire ballistic missile components or equipment to enrich uranium, it can't buy them through SWIFT, the international payment system. But it can use gold. Gold can't be hacked or traced. Unlike digital money in bank accounts, it can't be frozen. You just put it on a plane or ship and send it to its destination....Now these trading partners have a working payment system to settle trade. They're not using the dollar payment system, or the SWIFT payment system or anything that the U.S. can interdict or even trace. They're in effect bypassing U.S. sanctions by using physical gold. This creates additional demand for gold as these nations acquire gold to preserve wealth and to mitigate their overdependence on the United States. But now they’re actually getting to the stage where a nondollar system is close to becoming a reality."
Petroyuan Is Only The Beginning, Pop Goes The Metals Market -Zero Hedge
"When Hong Kong Exchanges and Clearing bought the London Metals Exchange in 2012 all the speculation was about the effects on gold trading. The primary reason for buying the LME was to obtain its warehouses and ensure a free flow of metals to points east....Now we're seeing the next evolution of the power of owning the exchange. After successfully launching a yuan-denominated gold futures contract last year, the LME is now preparing to issue a range of yuan-denominated metals futures. In other words... Boom....The so-called ‘petroyuan’ oil futures contract, traded on the Shanghai Exchange, has captured more than 12% of the total oil futures market in just under two months. That's incredible. It tells us there was substantial demand for this product because many in the world were tired of being exposed to U.S. dollar currency risk to buy oil....The reason why the petroyuan contract was so immediately successful is because China provided traders with a direct path to convertibility into gold."
Turkey's economy at risk as currency hits record low -CNN Money
"Turkey is trying desperately to halt a collapse in its currency that could trigger an economic crisis just as the country prepares to vote in an election. The lira has plunged about 20% against the US dollar since the start of the year, hurt by a broader move by investors to switch money out of emerging markets and into the United States. But the currency crisis escalated rapidly earlier this month after Turkish President Recep Tayyip Erdogan indicated he wanted to take control of setting interest rates, which he described as 'the mother and father of all evil.' As investors stampeded out of the lira in response, driving it to a record low of about 20 US cents, the Turkish central bank on Wednesday announced an emergency hike in interest rates to 16.5% from 13.5%....Experts are worried that surging inflation could put a drag on economic growth. They're also concerned that money and investment could drain out of the country fast."
*Swiss America will be closed Monday, May 28th, in observance of Memorial Day*
5.24.18 - 40% of Americans Can't Cover $400 Emergency
Gold last traded at $1,304 an ounce. Silver at $16.68 an ounce.
NEWS SUMMARY: Precious metal prices rose Thursday on dollar weakness and geopolitical worries. U.S stocks slumped following Trump announcement of canceled North Korea summit.
Gold jumps after Trump cancels North Korea summit -Reuters
"Gold prices surged on Thursday, propelled above $1,300 per ounce after U.S. President Donald Trump called off a summit with North Korea, stoking political tensions. Trump canceled the meeting with Kim Jong Un, planned for June 12, even after North Korea followed through on a pledge to blow up tunnels at its nuclear test site....'It's a struggle to find any gold-negative news at the moment,' said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen. Gold's safe haven appeal was also burnished after the U.S. launched a national security investigation into car and truck imports that could lead to new tariffs similar to those it imposed on steel and aluminum in March. 'Trade spats are recurring and there's a focus on troubled emerging markets,' Hansen said."
World Banks Are "Swimming Naked" -Bonner/Bonner And Partners
"A Fed report out yesterday tells us that 40% of households cannot raise $400 for an unexpected emergency. One out of five cannot pay its monthly bills. What will happen to these people when interest rates rise and easy credit disappears? Businesses close. Households go broke. The desperate rabble gets roused and the feds panic....Asset prices float on a sea of liquidity... credit pumped into the markets by central bankers. But now, all of the world's major central banks - with the exception, possibly, of the Bank of Japan - are taking their hands off the pump handle or actually draining out cash and credit. The Fed is tightening up… raising its key rates in quarterly 0.25% mini-steps....Patrick Artus, an analyst with Natixis, puts the world's total monetary base at about $24 trillion. It's been growing for the last 10 years at a double-digit rate. This is the money that has kept the Dow riding high and that sent it over 26,000 in January. But now, the 38-year-old tide has turned. Over the next 12 months, Artus estimates liquidity growth of only 3%, not nearly enough to sustain financial markets or the economy. So cover your eyes, Dear Reader. The water is receding. You are about to see some hideous sights."
Why gas prices are so high — and what Americans may have to risk to make them lower -Crudele/NY Post
"Five-buck-a-gallon gasoline in the city - and $3 gas in the burbs. And going higher. That's the news motorists are facing this Memorial Day weekend. And pretty soon, those rising prices will put Americans' appetite for offshore oil drilling to the test. The Trump administration has already proposed drilling off virtually the entire US coast....There's been a problem with oil production in two key parts of the world - Iran and Venezuela - and that's one of the things that's been driving oil prices higher. And one of the best ways to combat those rising prices is to increase oil output somewhere....Now, with Trump and his go-drill, instead of no-drill, policy in the White House, the politics of oil exploration have changed. Will the US buy into that policy?....There really isn't a shortage of oil in the world - not like when OPEC created problems in the 1970s....So what's the problem? With gasoline inventories up, prices should be going down. That’s where financial speculators come in. With Venezuela's economy collapsing and Iran under international pressure because of its nuclear policies, Wall Street is expecting all the production numbers to drop soon."
40% of Americans can't cover a $400 emergency expense -CNN Money
"Can you cover an unexpected $400 expense? Four in ten Americans can't, according to a new report from the Federal Reserve Board. Those who don't have the cash on hand say they'd have to cover it by borrowing or selling something....'This year's survey finds that rising levels of employment are translating into improved financial conditions for many but not all Americans,' Federal Reserve Board Governor Lael Brainard said in a press release...many are still struggling. Notable differences remain across race, ethnicity, education levels and geography. The report shows hardship continues for people working to repay college loans, cover emergency expenses and manage retirement savings....'The finding that four-in-ten adults couldn't cover an unexpected $400 expense without selling something or borrowing money is troubling,' said Greg McBride, chief financial analyst at Bankrate.com. 'Nothing is more fundamental to achieving financial stability than having savings that can be drawn upon when the unexpected occurs....The burden is on us as individuals to save for our retirement,' he says."
5.23.18 - Inflation Barreling Toward Consumers
Gold last traded at $1,293 an ounce. Silver at $16.47 an ounce.
NEWS SUMMARY: Precious metal prices traded mixed despite dollar strength ahead of Fed minutes. U.S. stocks fell on renewed China trade worries while awaiting the Fed's latest inflation outlook.
Inflation is coming to the US economy on an 18-wheel flatbed -CNBC
"Multiple signs of inflation in freight-related industries are at or near historical highs, in what could be an early sign that price pressures are building and ready to reverberate around the economy....Recent readings show demand for vehicles skyrocketing, a sign that generally points to inflationary pressures building up in the supply chain. 'It's an indication that there's capacity pressure in the marketplace, that brokers are searching more and posting more in order to find a truck,' said Peggy Dorf, market analyst at DAT. 'This is an indicator that pressure is much higher than it was a year ago.' Every other broad market trend line that DAT posts was up double digits on a year-over-year basis - including the all-important fuel costs, which are up 20 percent....It all adds up to an environment that could prove tricky ahead. The Federal Reserve is continuing to raise interest rates, with at least two more quarter-point hikes expected this year."
The Case for a New International Monetary System -Sheldon/CATO
"Today there are compelling reasons - political, economic, and strategic - for President Trump to initiate the establishment of a new international monetary system....The vision of providing a solid monetary foundation for global free trade was shattered by Nixon's decision to suspend gold convertibility of the dollar....It's time to reassert the primary functions of money as (1) a medium of exchange, (2) a unit of account, and (3) a store of value....In proposing a new international monetary system linked in some way to gold, America has an opportunity to secure continued prominence in global monetary affairs while also promoting genuine free trade based on a solid monetary foundation. Gold has historically provided a common denominator for measuring value; widely accepted at all income levels of society, it is universally acknowledged as a monetary surrogate with intrinsic value. Speaking in February 2017, former Federal Reserve Chairman Alan Greenspan defined gold as the 'primary global currency' and further added, 'We would never have reached this position of extreme indebtedness were we on the gold standard, because the gold standard is a way of ensuring that fiscal policy never gets out of line'....We make America great again by making America’s money great again."
Will the Trump administration take steps to propose a new international monetary system linked with gold? We hope. Meanwhile, you can take steps to put your family on a PERSONAL Gold Standard starting today, by calling Swiss America at 800-289-2646 or requesting our FREE 2018 Real Money Perspectives newsletter, The Future of Money.
Who sanctions America? -Bonner/Bonner And Partners
"The Dow jumped over 25,000 yesterday. But unless (and until) it can beat the January top of 26,616, we will presume that the primary trend is down. And since primary trends tend to last a long time, we further presume that stocks may be set to slide for the rest of our lives. Big moves take time. Stocks peaked out in August 1929. Inflation adjusted, it was not until 30 years later that they fully recovered. They peaked out again in 1966. And again, it took 30 years for an investor to get his money back in real terms (not including dividends). If this pattern holds, the peak in January won't be seen again until 2048. Good luck with that!....Nature needs balance and harmony. Civilization thrives on limits, restraints, and corrections. 'Too much' upsets it. When there is 'too much,' something has to give. Otherwise, it tips over into chaos and calamity. After the Cold War ended, the U.S. was master of the field… unopposed… on the top of the heap. It could have brought its troops home and cut its military spending in half… or more… restoring some measure of balance with the rest of the world....The 'enemy' was defeated. But military spending still went up, and now sits at $580 billion, up from $355 billion in 1991....Americans are perfectly happy with this situation. Neither Democrats nor Republicans resist."
A Central Banker's Plan for Your Money -Daily Reckoning
"Jim Rickards calls them 'silent dog whistles.' Through these signals, in the frequencies beyond normal human hearing… elites communicate with each other. Their communications are public. But their language can be so thick, so technical - so innocuous - not one in a hundred can crack it open....Hold this information close when you consider the recent speech by a certain Benoit Coeure...This Coeure fellow is a grandee of the European Central Bank (ECB)....Let us...translate: 'Cash limits our options as central bankers. Private citizens should not be allowed so large a voice in monetary affairs. Besides, no one wants it anyway. The time has come to discard cash altogether, as we previously discarded the 'barbarous relic,' gold....Cryptocurrencies are a threat to our control of the monetary system. Unacceptable. We cannot stop the technology, so we must co-opt it. We must ensure that the masses can only use authorized cryptocurrency - ours, that is. We must ban all rival cryptocurrencies.'....The problem comes back to cash. No one will pay the bank to hold their cash, so the masses would withdraw their money from the banking system. Cash therefore prevents us from employing truly negative interest rates. In consequence, cash must go. Once all money is digital, we'll completely capture the monetary system and can make negative interest rates a reality....The elites must ban cash so they can herd us all into the 'digital pens.'...Then when the next crisis strikes, it's off to the digital pen… to be sheared."
In our new White Paper, THE SECRET WAR, PART II: Weapons of Cash Destruction, we reveal more of the worldwide scheme to stop the private use of cash and force people into banks and credit cards so that every transaction can be controlled, tracked and taxed.
5.22.18 - Will Cryptos Evolve Into Useful Money?
Gold last traded at $1,292 an ounce. Silver at $16.57 an ounce.
NEWS SUMMARY: Precious metal prices steadied Tuesday on bargain hunting and a flat dollar. U.S. stocks were level as investors paused following a statement by President Trump expressing doubts about the proposed June North Korea summit.
Gold inches higher as dollar rally runs out of steam -Business Day
"Gold edged up on Tuesday from a 2018 low, adding traction as the dollar fell off its five-month high, although risk appetite in the broader financial markets kept the precious metal’s gains in check. The dollar lost momentum following a broad rally prompted by rising US bond yields and the prospect of a resolution to US-China trade tensions. A weaker dollar makes dollar-priced gold cheaper for non-US investors. Washington and Beijing both claimed victory on Monday as the world’s two largest economies stepped back from the brink of a global trade war and agreed to hold further talks to boost US exports to China....'The positive views on the US economy are overdone,' said Philip Newman, director at Metals Focus. 'There are concerns over sizeable US debt, there’s the [US] mid-term elections in November, there's enough out there that could see the dollar eventually weaken and gold prices start to improve through the back end of this year.'"
Cryptocurrencies Likely To Evolve Into Useful Money -Rahn/Washington Times
"Money is most often defined as something that serves as a unit of account, a store of value and medium of exchange. Traditionally, a medium of exchange was such things as coins, paper notes and checks....Most transactions now are electronic - bank transfers, cards, cell phone apps, etc. Physical cash has held on because of perverse government anti-money laundering regulations, which make it almost impossible for many to obtain bank and other financial accounts, and for people to maintain some degree of financial privacy. Cryptocurrencies, such as bitcoin, can serve as a unit of account and a medium of exchange, but not as a store of value - as long as there is nothing more than an algorithm to anchor them....Cryptocurrencies are likely to evolve into more useful money substitutes as issuers began to back them with real assets....What is likely to happen is that a number of entrepreneurs will start issuing cryptocurrencies with real backing (experiments are under way) - precious metals, like gold and silver; industrial commodities, like aluminum; and various baskets of commodities, which may even include services. Eventually, one or several will become global standards...Governments will, of course, fight to maintain their money monopolies, but they are likely to lose because they will be offering an inferior product. A world without government monopoly money will be more free and less costly, with more prosperity."
We agree with Mr. Rahn; the primary problem with cyrptos is the missing 'store of value' component of true money - which in the future could be solved by backing them with physical precious metals. Meanwhile, we think owning physical gold is the best protection from both asset and monetary inflation. Get the facts so you can come up with your own conclusions in our FREE 2018 Real Money Perspectives newsletter, The Future of Money.
"Eight More Years!" -Pontification Blog
"Democracy is supposed to be a peaceful form of change that transfers power from one leader or lawmaker to another not by war, revolution, or assassination, but by society's mutual agreement....But since Mr. Trump's overwhelming victory - 304 Electoral Votes to only 227 for Clinton - she and her media comrades and other unelected members of the Deep State have claimed that Ms. Clinton won, or should have been declared the true winner of, the 2016 election. This has turned into more than a rant against President Trump. It has become a relentless attempt to delegitimize his presidency and remove him from office. It has, as many have observed, become on ongoing coup d'etat, a 'taking down' of our democracy. Media create a social contagion of violence, showing children they can gain fame by shooting others, and glorifying celebrities who advocate ways to assassinate President Trump. If the Left cannot get power with ballots, it will use bullets....Special Counsel Robert Mueller is not investigating a crime, as our legal system requires, but pursuing President Trump in hopes of finding a crime, any crime. The techniques of Mueller's team of mostly-Democratic partisan donors and operatives are those of England's Star Chamber and of Tower of London threats of torture to elicit political confessions against the President. This, too, is not how democracy, or justice, are supposed to work. If and when these anti-democratic leftist furies fail in their effort to undo the 2016 election, voters will rightly ask for justice. How can they reclaim their chosen President’s two stolen years of governing?" Full story
The death of the summer job -US News/CNBC
"Teen employment and summer jobs aren't as popular as they used to be. 'Even though some teens still have summer jobs, the proportion of teens who participate in the labor force during the summer has dropped dramatically,' Teresa Morisi, a branch chief at the Office of Occupational Statistics and Employment Projections at the Bureau of Labor Statistics, wrote in a report published last year looking specifically at teen employment declines. 'In July 2016, the teen labor force participation rate was 43.2 percent, down almost 30 percentage points from the high point of 71.8 percent in July 1978.' That participation rate dropped even further last summer. The BLS estimates the labor force participation rate for 16- to 19-year-olds - a measure that tracks the share of teens either employed or actively looking for a job - stood at 42.5 percent in July 2017....But it's not just summer jobs - teen employment throughout the year is down significantly from where it stood in generations past....40.6 percent of teens from households that bring in between $100,000 and $149,999 annually were employed during 2015 and 2016. But just 23 percent of teens from households that earn fewer than $20,000 each year had jobs during that window....'It is counter-intuitive. You think the teens whose households need the money would work more to get the money. But I think what's playing out here are the effects of social networks and norms within the family and belief about the value of work,' Ross says."
5.21.18 - Mocking the Fed's Definition of Inflation
Gold last traded at $1,290 an ounce. Silver at $16.52 an ounce.
NEWS SUMMARY: Precious metal prices steadied Monday despite a firmer dollar. U.S. stocks rose as trade tensions between the U.S. and China dissipated for the moment.
U.S.-China Trade Truce May Not Last as Differences Remain -Bloomberg
"The U.S. and China declared a truce in their trade dispute over the weekend, but that will prove temporary if the world's two largest economies fail to deliver on their vague commitments to re-balance trade. 'We're putting the trade war on hold,' Treasury Secretary Steven Mnuchin said Sunday after the two sides released a joint statement a day earlier. 'Right now, we have agreed to put the tariffs on hold while we execute the framework.' For now, Mnuchin's cease-fire declaration will soothe the nerves of investors worried that the world's two biggest economies were on the verge of an all-out trade conflict. President Donald Trump had threatened to slap tariffs on up to $150 billion in Chinese imports, and Beijing vowed to respond in kind. Trump on Monday tried to put a positive spin on the negotiations. 'China has agreed to buy massive amounts of ADDITIONAL Farm/Agricultural Products - would be one of the best things to happen to our farmers in many years!' he said in a series of postings on Twitter. 'On China, Barriers and Tariffs to come down for first time.'....Still, there's no guarantee that China’s trade frictions with the U.S. won't re-emerge in the future, a foreign ministry spokesman told reporters Monday at a regular briefing in Beijing."
Mixed Signals on China Trade -Fox Business
Author and Swiss America Chairman Craig R. Smith, VP of Vision 4 Fund Distributors Heather Zumarrago, and Layfield Report CEO John Layfield discuss the recent perceived improvements in the U.S.-China trade negotiations prior to the June 12th U.S.-North Korean summit.
A Warning Signal for Global Stock Markets Is Flashing in Japan -Bloomberg
"Morgan Stanley calls it 'the end of easy,' that witching hour in global stock markets when economic growth is slowing, the Federal Reserve is tightening, and inflation is ticking up. After a long bull run, strategists the world over are getting nervous -- and watching for the top. And over in Tokyo, a warning is starting to flash. A feared rotation is taking hold, as investors dump the shares that propelled the good times, such as industrials and technology companies, in favor of an entirely different class of firms: those needed no matter how bad the economy gets. When investors become less optimistic about the future, the theory goes, that’s where they turn. 'No one can really tell whether global stocks will go into a bear market,' said Yoshinori Shigemi, a global market strategist at JPMorgan Asset Management Japan Ltd., 'But when Japanese defensives outperform, it can be a leading indicator.' Utilities, health-care, consumer staples and real estate stocks - all so-called defensive shares - are the top performers of the 11 industry groups in the MSCI Japan Index this year, beating information technology and industrial companies, so-called cyclical shares."
Turkey Repatriates All Gold From The US In Attempt To Ditch The Dollar -Zero Hedge
"After Venezuela, Germany, Austria and the Netherlands prudently repatriated a substantial portion (if not all) of their physical gold held at the NY Fed or other western central banks in recent years, one month ago Turkey announced that it too has decided to repatriate its gold stored in the US Federal Reserve and deliver it to the Istanbul Stock Exchange, according to reports in Turkey's Yeni Safak. And now, according to a report by the Swiss Schweiz am Wochenende, the repatriation is complete with the Turkish central bank withdrawing all of its gold reserves from the U.S. due to the 'tense political situation.'....Turkey's gold repatriation come at a sensitive time for Turkey's currency, the lira, which has been pounded for the past month, and plunged to all time lows against both the dollar last week amid double-digit inflation in Turkey....The NY Fed still holds the world hostage thanks to its custodial holdings of 5,750 thousand tons of foreign-owned gold."
Collapsing Iran and Venezuela Mock the Fed's Definition of Inflation -Tamny/Forbes
"It changes by the day, but Iran’s currency - the rial - is falling. This is inflation. The value of money declines such that holders of it can exchange it for fewer and fewer goods and services. Something similar, but exponentially worse, is happening in Venezuela. A recent article in the Wall Street Journal indicated inflation of 13,000% due to a plummeting Bolivar. If Iran's economy is down, Venezuela's is collapsing. The suffering taking place in both countries rates prominent mention in consideration of the modern view of inflation promoted by the biggest employer of economists in the world: the Federal Reserve. According to the credentialed in its employ, economic growth causes inflation. Yes, more people working and prospering supposedly has a downside. According to the Fed, the downside is inflation. Except that the Fed's view of inflation is 100% backwards. Crucial here is that it's backwards in countless ways. Inflation is always and everywhere a function of a declining currency. It's not a growth phenomenon as the Fed suggests. Fed economists would be wise to visit Iran and Venezuela to understand that inflation has nothing to do with prosperity....The Fed's incorrect inflation definition is rooted in a triple falsehood born of the easily disprovable view inside the bank that consumption drives economic growth....Sad is that economists at the Fed are still hung up on a modern definition of inflation that could have only been divined by economists, and that has nothing to do with reality."
5.18.18 - Mortgage Rates Hit 7-Year High
Gold last traded at $1,292 an ounce. Silver at $16.45 an ounce.
NEWS SUMMARY: Precious metal prices rose Friday on bargain-hunting despite a firmer dollar. U.S. stocks drifted lower as tensions between the U.S. and China weighed on investor sentiment.
When This Happens, Buy-Bonner/Bonner And Partners
"The Dow was below 8,000 when it hit bottom in the last credit crash in 2009. Now, it's over 24,000....While the Dow has more than tripled, the economy that supports it has not. GDP was nearly $15 trillion in 2008. It's only $20 trillion 10 years later. That is not a triple… not a double… not even a 50% increase. It’s just a 33% boost....Super investor Warren Buffett's favorite indicator is the stocks/GDP ratio....And Buffett says that as long as the value of stocks is 80% (or less) of GDP, investors can safely buy. Today, U.S. GDP is the aforementioned $20 trillion. And the value of all equities is about $28 trillion...That gives us a ratio of 1.42...This is the second highest the indicator has ever been… higher than in 2007. The previous record - set in the first quarter of 2000 - was 1.51, which was nearly twice the long-term average. So here's the big picture: Interest rates are going up. As for assets, our guess is that when the stock market gets a load of what 4% rates will do, it will panic… and drop more than expected, faster than expected. When prices get back in Warren Buffett’s buy zone of 80% (or less) of GDP - which they must sooner or later - stocks will have lost about 45% of today’s value. Dow 13,000, in other words. When they get to that level, buy!"
Pope Calls Derivatives Market a 'Ticking Time Bomb' -Bloomberg
"Warren Buffett once called them 'financial weapons of mass destruction.' Now Pope Francis, of all people, is taking aim at derivatives. In a sweeping critique of global finance released by the Vatican on Thursday, the Holy See singled out derivatives including credit-default swaps for particular scorn. 'A ticking time bomb,' the Vatican called them. The unusual rebuke - derivatives rarely reach the level of religious doctrine - is in keeping with Francis's skeptical view of unbridled global capitalism. 'The market of CDS, in the wake of the economic crisis of 2007, was imposing enough to represent almost the equivalent of the GDP of the entire world. The spread of such a kind of contract without proper limits has encouraged the growth of a finance of chance, and of gambling on the failure of others, which is unacceptable from the ethical point of view,' the Vatican said in the document....Income inequality is a priority concern for Francis, who has made humility a distinguishing feature of his papacy. He refused to live in the opulent Apostolic Palace, choosing a guest house for Church officials near St. Peter’s Basilica instead. He uses an old Ford Focus to get around the Vatican and Rome."
Mortgage Rates Hit Seven-Year High as Ultracheap Era Ends -Wall Street Journal
"Mortgage rates this week jumped to their highest level since 2011, signaling a shift from a period of ultracheap loans to a higher-rate environment that could slow home price appreciation and squeeze first-time buyers. The average rate for a 30-year fixed-rate mortgage rose to 4.61% this week from 4.55% last week, according to data released Thursday by mortgage-finance giant Freddie Mac. The jump this year reflects an abrupt departure from a long period of declining rates that began during the financial crisis. Rates bottomed out in late 2012 at 3.31% and clocked in at 3.99% as recently as January. The spike this year has been faster than many economists predicted as a surging economy, the prospect of wage gains and a steep rise in prices for commodities such as lumber and gasoline stoke inflation worries."
The Fed's Been Lying to Us About Inflation - It's Frighteningly High -Money Morning
"Even by the deeply flawed and misleading Consumer Price Index (CPI), inflation is at the U.S. Federal Reserve's target. By other measures that more accurately portray inflation, it is well above target....Furthermore, we know beyond a shadow of a doubt that, as the Fed raises the federal funds rate target, it will only stimulate more inflation. The Fed will always be behind the curve, because the Fed is always back there pushing the curve ahead....And the fact is that we really have more - much more - inflation than they're telling us. This isn't a mistake, it's not a miscalculation. Rather, it's a deliberate obfuscation....In the past few years, house prices have been inflating – consistently – in the 6% to 7% range, but, you guessed it, that is not included in CPI! It's not even counted in the official measures of 'inflation.'....The housing component of CPI is weighted at roughly 40% of core CPI (excluding food and energy). Simple math tells us if housing was included in CPI, then total core CPI would be 40% of the difference between the OER measure, at 3.4%, and the actual housing inflation rate of between 5.8% and 7%....Had housing prices been included in core CPI, it would never have read below 2%. It would have been in a range of 2.5% to 4.5% over the past five years."
US Birth Rate Hits All-Time Low: What's Behind the Decline? -Live Science
"The number of babies being born in the United States continues to fall, with the birth rate reaching a new record low in 2017, according to a new report from the Centers for Disease Control and Prevention. Last year, about 3.8 million babies were born in the U.S., which is 2 percent lower than the number born in 2016, and the lowest recorded number of births in 30 years, according to the report. Part of the reason for the decline in U.S. birth rates may be that people are in a general state of economic uncertainty, said Karen Benjamin Guzzo, associate director of the Center for Family & Demographic Research at Bowling Green State University in Ohio. Even though the Great Recession technically ended in 2009, people may still feel uneasy about their economic situation; they may be employed but working part time, or going to school and working, or trying to pay off student loans, Guzzo said....In addition, young adults may feel like they haven't met all the milestones they feel they need to reach before having a kid, such as getting a college degree, having a stable income and getting married. 'It takes longer to feel like you're a grown-up,' Guzzo said."
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