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4.21.17 - U.S. Housing Bubble 2.0?

Gold last traded at $1,289 an ounce. Silver at $17.85 an ounce.

NEWS SUMMARY: Precious metal prices traded mixed Friday, with gold rising on geopolitical uncertainty despite a firmer dollar. U.S. stocks slipped as French election worries overshadowed earnings enthusiasm.

Time To Own Some Gold -Seeking Alpha
"While gold may have just extended its run to nearly $1300 per ounce and then pulled back, we don't necessarily think the flight to the precious metal is going to be over anytime soon, and we consider gold a great buy here for the course of the long term, but especially over the course of the next 5 to 10 years. We admit that we like holding gold in basically any and all circumstances. We also like holding other precious metals like silver and platinum, mostly for the same reasons that we like to hold gold. We like gold because it is a hedge against many things. It is a hedge against owning securities, it is a hedge against inflation, it is a hedge against all different asset classes and it is the number one go to for investors when equity markets begin to capitulate. We also enjoy silver and platinum, not only because they are similarly situated hedges, but also because they each have manufacturing purposes which help contribute to their demand. The reason that we think gold is a good asset to own right now is because we are coming to the end of a seven or eight year debt cycle that started at the end of the 2008 financial crisis....If you want to be diversified across asset classes and you want to protect your wealth, you absolutely must own at least a little gold."

housing bubble Existing Home Sales Soar To 10-Year Highs -Zero Hedge
"Following February's 3.9% drop, March existing home sales roared back (up 4.4% MoM - the fastest growth since Dec 2015) to the highest since Feb 2007 at 5.71 million SAAR. Inventories tumbled (for the 22nd month in a row) and prices rose (for the 61st month in a row) as affordability issues remain ignored (for now). It seems, unlike 2013, that rising rates are not affecting demand for existing homes at all... (yet)....The median existing-home price for all housing types in March was $236,400, up 6.8 percent from March 2016 ($221,400). March's price increase marks the 61st consecutive month of year-over-year gains. With the high-end dominating the price appreciation....'This is a very broad-based recovery' in the housing market, Lawrence Yun, NAR’s chief economist, said at a press briefing accompanying the report...Policy changes could 'quickly change' the direction of housing in the second half, he said."

Fears shroud French election after Champs Elysees attack -AFP/Yahoo
"The killing of a policeman on Paris's Champs Elysees claimed by the Islamic State group rocked France's presidential race Friday with just two days to go before voting in the closest election for decades. Bloodshed had long been feared ahead of Sunday's first round of the election after a string of attacks since 2015, and the shooting propelled the jihadist threat to the fore. Far-right leader Marine Le Pen -- who is locked in a tight four-way contest with centrist Emmanuel Macron, conservative Francois Fillon and Communist-backed firebrand Jean-Luc Melenchon -- moved quickly to present herself as the toughest of the four on terrorism. The 48-year-old National Front leader called for France to 'immediately' take back control of its borders from the European Union and deport all foreigners on a terror watchlist. 'This war against us is ceaseless and merciless,' she said in a sternly-worded address, accusing the Socialist government of a 'cowardly' response to the threat....France has been under a state of emergency for nearly a year and a half, with more than 230 people killed in jihadist attacks since the start of 2015."

This Do-Nothing Congress Is A Travesty -Investors
"Agenda: Shortly after Donald Trump won the election, House Speaker Paul Ryan said that Republicans had to 'go big, go bold, and do things.' So far, the GOP has not delivered. 'They have the House, they have the Senate, they have the presidency - and nothing's happening,' lamented PJ Media co-founder Roger Simon earlier this week. 'Nothing, that is, that Donald Trump doesn't do by himself. ... The Republicans in the legislature are a disgrace.' Congress did pass, and Trump signed, 13 bills to undo last-minute Obama administration regulations. And the Senate approved Trump's Supreme Court pick. But what about actually advancing long-awaited Republican legislative priorities, like ObamaCare repeal and tax cuts? Nada....Now tax reform is slipping off the table, with Treasury Secretary Steven Mnuchin saying that getting reform done by August is 'highly aggressive to not realistic.'....There's plenty of blame to go around for the GOP's lack of achievements so far. But Ryan has been the biggest disappointment, since the House is where things get rolling....If Ryan can't figure out how to do this, and soon, he should consider handing the Speaker's gavel to someone who can 'go big, go bold, and do things.'"

Venezuela says inflation 274 percent last year, economists say far higher -Reuters
"Annual inflation in crisis-hit Venezuela last year reached 274 percent, according to data the central bank provided to the International Monetary Fund, although many economists believe the true figure is far more alarming....Venezuelan consultancy Ecoanalitica says inflation was 525 percent last year and New York-based investment bank Torino Capital - using one popular food item as a proxy - put it at 453 percent. Maduro himself last year increased the minimum wage by 454 percent, saying the rise was to offset inflation. Purchasing power has eroded and salaries annihilated as a result. On the black market, $1,000 in savings when Maduro was elected in 2013 would now be worth less than $5. The bolivar currency fell further against the U.S. dollar on Thursday and is now at its lowest value ever against the dollar, down 99.5 percent since Maduro came to power."

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4.20.17 - The 2017 Bull Market Not on Wall St.

Gold last traded at $1,283 an ounce. Silver at $18.01 an ounce.

NEWS SUMMARY: Precious metal prices traded steady Thursday as a weaker dollar offset mild profit-taking. U.S. stocks rose on better-than-expected earnings from American Express and Railway company CSX.

CIA, FBI launch manhunt for leaker who gave top-secret documents to WikiLeaks -CBSNews
"The CIA and FBI are conducting a joint investigation into one of the worst security breaches in CIA history, which exposed thousands of top-secret documents that described CIA tools used to penetrate smartphones, smart televisions and computer systems. Sources familiar with the investigation say it is looking for an insider - either a CIA employee or contractor - who had physical access to the material. The agency has not said publicly when the material was taken or how it was stolen....WikiLeaks has said it obtained the CIA information from former contractors who worked for U.S. intelligence. The CIA has not commented on the authenticity of the WikiLeaks disclosures or on the status of the investigation."

If the CIA, NSA and other top intelligence agencies - which hold America's most sensitive national secrets can be hacked - how safe do you believe your online assets to be? Find out in our free 2017 White Paper Don’t Bank On It!

Gold to Soar Past $1500 per Ounce as 2017 Shapes Up to Be Start of Gold Bull Market -Lombardi Letter
"It would have been difficult to predict what precious metals like gold and silver were going to do in 2016; gold started out strong, but Donald Trump’s unexpected election win in November weighed down gold prices for the remainder of the year. It’s a different story in 2017. The next gold bull market is here, one that will last at least until 2020. The gold bull market of 2017 will be just the second gold bull market of the last 37 years. But if history is any indicator, the strong 2017 gold bull market, which is just in its infancy, will provide gold bugs and contrarian investors with massive gains."

gold chart

"The last gold bull market ran from November 2000 to September 2011. Over this time frame, gold prices advanced 625% from approximately $265.00 per ounce to $1923 per ounce....There are a number of reasons why the gold bull market will only get stronger in the second half of 2017 and blow past its 2016 resistance level near $1380 an ounce....Stalemate in Washington....Stock Market on Shaky Ground....Inflation....A gold price forecast for 2017 broaching $1500 an ounce is certainly within reach....There are a lot of reasons why 2017 is the official start of a new gold bull market; one that is still young and one that will reward precious metal investors with massive gains over the next three years."

For more insights into the precious metals bull market of 2017, read our 2017 Gold Report and 2017 Silver Report.

What Is A "Legal Tender Law"? And, Is It A Problem? -Lewis/Forbes
"The present legal tender law in the U.S. is Section 5103 of title 31, United States Code, which reads: 'United States coins and currency (including Federal reserve notes and circulating notes of Federal reserve banks and national banks) are legal tender for all debts, public charges, taxes, and dues. Foreign gold or silver coins are not legal tender for debts.' Contrary to popular imagination, this does not ban people from using other forms of currency. It simply defines what a 'dollar' is, in a contract or obligation that is denominated in dollars....It is doubtless true that the U.S. government suppresses and blocks use of alternative currencies - especially those based on gold - through various means. This could be through regulatory burdens, taxes, and many other forms of harassment. They have to do it this way, because it is not actually illegal to transact business in whatever form of 'money' the parties to the transaction agree upon."

Trump Demands For Border Wall Funding May Force Government Shutdown Next Week -Zero Hedge
"After a week of flip-flops on everything from the value of NATO to labeling China a currency manipulator, moves which quickly earned him the moniker of 'flipper-in-chief' from a disgruntled base, Trump, under internal pressure to show legislative achievements ahead of the 100-day mark, is gearing up for a government shutdown fight to secure money for a border wall, more immigration enforcement officers and a bigger military....The White House, one person familiar with the conversations said, has pushed for $3 billion for the border wall, and discussions have been ongoing....Of course, in order to get a budget passed, the Trump administration will likely require some Democratic support in the House and certainly in the Senate. That said, Democratic leaders Schumer and Pelosi insist that any budgets that include funding for Trump's 'beautiful' border wall is a non-starter....But, the border wall and additional funding for immigration enforcement aren't the only issues that could force a government shutdown. As Politico notes, disputes over withholding funding to so-called 'Sanctuary Cities', and/or the defunding of Obamacare subsidies or Coal miners' health benefits could also end in a stalemate."

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4.19.17 - Retail Apocalypse Headed to 'Burbs'

Gold last traded at $1,283 an ounce. Silver at $18.16 an ounce.

NEWS SUMMARY: Precious metal prices eased back Wednesday amid profit-taking and a firmer dollar. U.S. stocks traded mixed as investors digested earnings reports from IBM and Morgan Stanley.

Credit Suisse Sees $1,400 Gold By End Of 2017 -Kitco
"Credit Suisse looks for gold prices to hit $1,400 an ounce by the fourth quarter as U.S. real interest rates ease and central bankers maintain dovish with monetary policy....'Gold's resurgence has been supported by lower U.S. yields - 10-year (is) 35 basis points below December peak - and a marginally weaker USD (U.S. dollar), down 2.6%,' Credit Suisse said in a Tuesday research report. 'The current environment still reflects higher real rates and a stronger USD than what existed pre-Trump, which suggests to us that recent gold strength has further to run as initial over-optimism continues to reverse.'....Credit Suisse said it maintains a bullish gold price outlook, looking for $1,400 gold in the fourth quarter, although the full-year outlook was trimmed to $1,323 from $1,338 previously to reflect prices in the first quarter. Meanwhile, Credit Suisse hiked its 2017 silver-price forecast to $18.46 an ounce from $18.Analysts see $19 silver in the fourth quarter."

gorilla Markets Start to Ponder the $13 Trillion Gorilla in the Room -Bloomberg
"After heading into the uncharted territory of quantitative easing, the world’s central banks are starting to plan their course through the uncharted waters of quantitative tightening. How the Federal Reserve, European Central Bank and - eventually - the Bank of Japan handle the transition could make the difference between a global rerun of the 2013 'taper tantrum,' or the near undetectable market response to China's run-down of U.S. Treasuries in recent years. Combined, the balance sheets of the three now total about $13 trillion, equating to greater than either China’s or the euro region’s economy....Current Vice Chairman Stanley Fischer says he doesn't see a replay of the 2013 tantrum, but the best laid plans of central bankers would soon go awry if markets can't digest the great unwinding. 'You know what they say about mountaineering right? The descent is always more dangerous than the ascent,' said Stephen Jen, London-based chief executive of hedge fund Eurizon SLJ Capital Ltd. 'Shrinking the balance sheet will be the descent.'....A wild card is the potential overhaul of the Fed board that’s open to President Donald Trump."

The Retail Apocalypse Is Suburban -Slate
"Cities will weather this concentrated economic downturn because they went through it 50 years ago. Their neighbors may not be so lucky. One by one, the problems that America has long dismissed as 'urban' have marched into the suburbs: crime, poverty, hunger, deindustrialization, drug addiction, civil unrest. The dissolution of community institutions. An aging stock of unwanted houses. To which we can add: the decline of retail. It has been a decade since the media declared the death of the mall, in a year that would be the first in a half-century that no new malls were built in America....The Limited, a women’s clothing store, shut down 250 stores and laid off 4,000 workers earlier this year. Sears Holdings will close 150 stores, including 108 Kmarts, and Macy’s will close another 100. As anchor stores close, more and more malls are entering foreclosure....And if there’s a lesson from the cities, it's that the broader systems changing how people shop cannot be overturned with tax breaks for new developments. The sooner they begin to think of alternate ways to create community and jobs - and to reuse and rebuild the vacated space of the mall - the better off they’ll be."

Mnuchin Says Trump Is "Absolutely Not" Trying To Talk Down The Dollar -Zero Hedge
"One week after Donald Trump, in an interview with the WSJ, sent the dollar tumbling in its biggest one day drop in months, Treasury Secretary Steven Mnuchin has been engaging in damage control with not one but two appearances in the FT, first stating that in the 'long-run' a stronger dollar is beneficial for the US economy on Monday, and then again making headlines overnight when he said that Donald Trump is 'absolutely not' trying to talk down the strength of the dollar, as stated again in the Financial Times on Wednesday....Mnuchin also said the Trump administration did not deem foreign countries to be manipulating their currency if they did so in a way that benefited Washington....As Reuters adds, finance ministers and central bank chiefs meet in Washington this week for the International Monetary Fund's twice-yearly meetings. Mnuchin said addressing currency swings was 'one of the IMF's most important roles'."

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4.18.17 - Is The Fed Paying Banks Not to Lend?

Gold last traded at $1,294 an ounce. Silver at $18.27 an ounce.

NEWS SUMMARY: Precious metal prices traded mixed Tuesday with gold rising amid ongoing geopolitical worries. U.S. stocks fell sharply as healthcare and financial earnings disappointed investors.

Gold may 'sky-rocket' on weak dollar and rising geo-political tensions -ProfessionalAdvisor
"Gold's strong run could continue as the US dollar weakens and investors seek safe-havens in the face of increasing geo-political risks, according to Prestige Economics. The price of gold bullion has risen 11% this year as investors look to the commodity as a refuge from the uncertainty surrounding US President Donald Trump's political and economic policies....Jason Schenker, founder of Prestige Economics told Bloomberg: "Gold is going higher here. We see a gradually weakening dollar on trend. 'Although we expect two more rate hikes this year - September, December - and four rate hikes next year, what we also think is that a lot of that is priced in.'....Furthermore, in a survey conducted by Bloomberg last week, analysts were the most positive on gold since December 2015. Schenker added: 'If we get weak Q1 GDP numbers, equities are going to take a big hit, the dollar is going to take a big hit and gold is going to sky-rocket.'"

Gold is the most trustworthy, safe-haven asset on earth and silver is a very undervalued infrastructure metal. Don't wait another day to add gold and silver wealth insurance to your portfolio for peace of mind. Read our 2017 Gold Report and 2017 Silver Report.

SATC gold Asian Billionaire 'Aggressively Adding Physical Gold Now' -MarketSlant
"The richest man in all of Asia is aggressively preparing for collapse: 'Direct exposure to gold as super wealthy focus on wealth preservation'....According to Gold Mining Chairman Amir Adnani and Sprott U.S. Holdings CEO Rick Rule, some of the biggest billionaire investors on the planet are actively seeking out precious metals like gold as wealth protection insurance amid the uncertainty of the current geo-political climate. In a recent interview with SGT Report, Adnani explains that several super wealthy individuals with whom he works very closely, including mainland China’s biggest billionaire investor and the richest man in all of Asia Li Ka-shing, have a renewed and urgent interest in diversifying their assets into both, gold mining firms and the physical asset itself: 'This individual’s net worth is about $35 billion…For the first time in a number of years of working with his team when it comes to investments in commodities that they believe were important to the strategic growth of China…for the first time they are looking for gold related investments.'....'It may not necessarily be as critical to think whether it's $1200 an ounce or $1300… we fixate so much on the price… and we forget that irrespective of what it’s trading at on any given day it’s meant to be an insurance policy… it’s meant to be protection of wealth and preservation of wealth…"

Free Money! Is The Fed Paying Banks $22 Billion To Not Lend? -Zero Hedge
"Excess reserves of depository institutions peaked at $2.7 trillion in August of 2014. By December of 2016, excess reserves fell to $1.9 trillion but have since climbed back to $2.2 trillion. On October 3, 2008, Section 128 of the Emergency Economic Stabilization Act of 2008 allowed the Federal Reserve banks to begin paying interest on excess reserve balances ('IOER') as well as required reserves. The Federal Reserve banks began doing so three days later. As interest rates have risen, so has the free money to banks. At 1% interest, banks receive $22 billion in free money every year, nearly all of that goes to the largest banks. Banks Paid $22 Billion to Not Lend? Some argue that banks have an incentive to not lend, simply to collect interest. Mathematically, it does not work that way. Excess reserves are a function of the Fed’s balance sheet and those reserves do not change whether a bank lends more or not."

Who keeps working - and who doesn't - if the government shuts down next week -CNBC
"Here we go again. When Congress comes back from recess Monday, it has just five days to head off yet another government shutdown by the end of next week, when the U.S. Treasury officially runs out of the legal authority to spend money. That deadline will set up another showdown - this time with a new president and fractured GOP - that could once again inflict fiscal chaos and force federal agencies to suspend services and send workers home....If Congress once again shoots itself in the fiscal foot, the resulting gridlock would be inconvenient and costly for taxpayers. On the other hand, the disruption - even if a shutdown lasts only a few days - would be painful and widespread. Some benefits, like unemployment insurance and veterans' benefits, could be delayed or reduced. National parks, museums and many passport offices would shut down; the Small Business Administration and FHA would stop guaranteeing new loan applications; farm subsidy checks stop flowing, and IRS tax processing would slow down, among other headaches."

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4.17.17 - Lessons From United About Bank Risks

Gold last traded at $1,291 an ounce. Silver at $18.51 an ounce.

NEWS SUMMARY: Precious metal prices rose to 5-month highs Monday on safe haven buying and dollar weakness. U.S. stocks rose in a relief rally as geopolitical worries over North Korea subsided.

Hacker documents show NSA tools for breaching global money transfer system -Yahoo/Reuters
"Documents and computer files released by hackers provide a blueprint for how the U.S. National Security Agency likely used weaknesses in commercially available software to gain access to the global system for transferring money between banks, a review of the data showed. On Friday, a group calling itself the Shadow Brokers released documents and files indicating NSA had accessed the SWIFT money-transfer system through service providers in the Middle East and Latin America. That release was the latest in a series of disclosures by the group in recent months. Matt Suiche, founder of cybersecurity firm Comae Technologies, wrote in a blog post that screen shots indicated some SWIFT affiliates were using Windows servers that were vulnerable at the time, in 2013, to the Microsoft exploits published by the Shadow Brokers....'We now have all of the tools the NSA used to compromise SWIFT (via) Cisco firewalls, Windows,' Suiche said....Because tracking sources of terrorist financing and money flows among criminal groups is a high priority, SWIFT transfers would be a natural espionage target for many national intelligence agencies."

Craig Smith comment: In our 2017 updated Don't Bank On It! White Paper we document how SWIFT has already been hacked; and one of its major victims was Wells Fargo Bank. See page 43 of our 2014 Don't Bank On It! book for the discussion of the vulnerability of SWIFT.

united If You Thought United Airlines Was Bad, Then Take a Look at Your Bank! - PontificationBlog
"40,629 people who had valid tickets have been involuntarily bumped from airliners, because airlines are allowed to sell more tickets than they have seats on each flight. But millions of us risk losing our savings because banks are allowed to lend long-term, or in other ways gamble by speculative investment with, the money they take in as short-term demand deposits. Our banks are a lot like United Airlines! Most of us still assume that putting our money into a bank makes us safer. Instead, under current law you do not 'own' your bank account. The bank does and can put it at risk, The government, under 'bail-in' rules established by President Barack Obama, can confiscate every dollar in your account as 'assets' that belong to the bank, not to you. Why, if you try to withdraw more than a small amount from your account, could your bank refuse to return the savings or retirement cash you entrusted to them?....In our free, updated 2017 White Paper Don’t Bank On It! Executive Summary, monetary expert Craig R. Smith and I explain 20 major reasons why your bank has become one of the riskiest places to put your money. This began centuries ago, when people paid the goldsmiths of London to keep their gold coins in safes. The goldsmiths gave out paper receipts for this money, which depositors began trading with others like money. Most people left their gold untouched, so the goldsmiths began lending it for interest." Full story

Gold hits 5-month high on rising geopolitical risks -Reuters
"Gold jumped to a five-month high on Monday as investors took refuge in safe-haven assets amid rising geopolitical tensions over North Korea. Spot gold was up 0.4 percent at $1,290.40 an ounce by 11:23 a.m. EDT, after hitting its highest since early November at $1,295.42 earlier in the session. The yellow metal gave up some gains as the dollar came off a five-month trough against the yen hit earlier in the day, and 10-year U.S. Treasury yields also rebounded from their lowest level since November. U.S. stocks edged higher after three straight days of losses....'Gold will likely retain a measure of strength heading into the French elections in about one week's time, while ongoing tensions in North Korea should also keep the markets rather nervous,' said INTL FCStone analyst Edward Meir."

How to Fix the Airline Overbooking Problem -Samuelson/RealClearMarkets
"There are lots of public policy problems that, even with the best of political goodwill, cannot be easily solved. They're just inherently tough. Fixing airline overbooking is not one of them. As proposed by Harvard economist Greg Mankiw on his blog, the solution is straightforward: Make the airlines pay when they overbook. When they do, 'they should fully bear the consequences. They should be required (by government regulation) to keep raising the offered compensation until they get volunteers to give up their seats,' writes Mankiw. 'If $800 does not work, then try $1,600 or $8,000.' Mankiw adds, somewhat gratuitously, that he's 'sure volunteers will appear as the price rises.'....Making airlines pay more for overbooking would, almost certainly, make them more careful in their scheduling, while also more adequately compensating inconvenienced passengers."

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4.13.17 - Real Estate: Buy or Sell?

Gold last traded at $1,288 an ounce. Silver at $18.51 an ounce.

NEWS SUMMARY: Precious metal prices steadied near 5-month highs Thursday on safe haven buying and rising uncertainty. U.S. stocks traded lower as banks kicked off the earnings season and volatility increased.

Trump and the Dollar: What Did He Say? -Real Clear Markets
"For the first time in months, Trump used the bully pulpit to push the dollar down....Trump said the dollar was getting so strong that hit [sic] was hampering the ability of US firms to compete. In an unusual act of contrition, the President said that the confidence the investors have in him was partly responsible for driving the dollar higher. For the record, the read broad trade-weighted measure of the dollar was lower at the end of March than it was at the end of November. It is not clear what course of action the US will take, if any, to remedy the situation. Treasury Secretary Mnuchin likely was not a happy camper. Speaking for the US, Mnuchin agreed at the recent G20 meeting that countries ought not to seek economic advantage in the currency market....President Trump made two other revelations. First, he indicated that he wants health care reform before tax reform....Second, he said that the reappointment of Yellen was a possibility."

money Gold, silver prices rally after Trump calls dollar ‘too strong’ -Marketwatch
"Gold, silver and prices for other metals rallied Thursday, bolstered as the U.S. dollar fell after U.S. President Donald Trump said the currency has been trading at 'too strong' of a level....The dollar fell to a five-month low against the yen and the ICE Dollar declined to a roughly two-week low after Trump's comment. 'I think our dollar is getting too strong, and partially that’s my fault because people have confidence in me,' he told the Journal. 'Gold had been trading higher based upon geopolitical tensions,' including those between the U.S. and Russia and North Korea, but 'what gold really needed to keep its rally going was some sort of a fundamental monetary driver,' said Brien Lundin, editor of Gold Newsletter....In a note Thursday, Ross Norman, chief executive officer of Sharps Pixley in London, said the $1,291 level is 'critically important'...'Conclusively breaching this trendline is to say we are very much back in a bull run,' he said."

Gold Overcomes Fed's Headwinds -Rickards/DailyReckoning
"Gold’s recent spike was fueled in part by geopolitical concerns surrounding the Syria missile attack by the U.S. and rising tensions in North Korea. Neither of these situations will be resolved soon, and both have the ability to escalate into war for the United States. Geopolitics will continue to keep a floor under gold prices. That said, what’s most impressive about gold’s multi-month rally is that the macro environment has not been particularly good....Fed tightening has supported a strong dollar, which is typically a headwind for the dollar price of gold....With gold rising in a difficult environment, imagine how much more it will surge if the Fed moves to an easing policy. And that’s exactly what I expect. One more Fed rate hike in June might be the last nail in the coffin for the U.S. economic expansion that began in June 2009. This expansion is already one of the longest on record, over 91 months long. The average expansion since 1980, a period of long expansions, is 80 months. Clearly the economy is living on borrowed time as well as borrowed money."

What I learned about the US real estate market this week -Black/SovereignMan
"For the last several days I’ve been speaking at an investment conference organized by my friends Robert Helms and Russell Gray....One of the key themes so far in the event is that there are likely problems ahead for the US real estate market. On the first day I had a great conversation with the Chief Economist of Fannie Mae, who was also speaking at the conference....I asked him point blank - what do you think of US housing right now? He answered succinctly: 'It’s overpriced.' His presentation went DEEP into the data, showing that US housing is 'late in the cycle,' meaning that prices may soon reach their peaks and then suffer a substantial correction. Property prices nationwide across the United States have been rising at a much more rapid rate than wages and salaries. This is totally unsustainable....No one here expects that any crash or major correction in US property prices is imminent. But in general, the consensus here is that you’re better off being a seller in the US right now rather than being a buyer."

U.S. Consumer Sentiment Climbs on Upbeat Assessment of Economy -Bloomberg
"Consumer sentiment advanced to a three-month high in April as Americans’ optimism about their current financial situation and the economy reached the strongest point since 2000, University of Michigan survey data showed Thursday....Some 52 percent of respondents to the Michigan survey reported that their finances had recently improved, the highest share since 2000. The more favorable assessment reflected higher incomes and wealth, as well as low prices. The report hinted that households would respond to greater optimism by making big purchases. Perceptions of favorable conditions for purchases of durable goods were cited by 82 percent of respondents, the largest share since 2005. Nevertheless, the university’s expectations measure remains divided along party lines, as 69 percent of Republicans cited favorable news about employment and economic policies, compared with only 28 percent among Democrats."

** Swiss America will be closed Friday, April 14th in observance of Good Friday. We wish all of our readers a blessed Easter.**

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