11.26.19 - Who is Going to Buy the Glut of Boomer Homes?
Gold last traded at $1,459 an ounce. Silver at $17.03 an ounce.
NEWS SUMMARY: Precious metal prices rose Tuesday on bargain hunting and a flat dollar. U.S. stocks were little changed, but managed to post fresh records as retail shares outperformed.
Collapse of Stock Market Is Likely; Gold Prices to Benefit -The Street
"As investors shy away from precious metals, interest is piling onto risk assets like equities that are fueled by 'cheap money' injected by the central bank, this according Todd Horwitz, chief strategist of BubbaTrading.com. 'Therein lies the real issue, is that cheap money continues to propel [returns], and the only real place to get a return on your money is the U.S. stock market,' he said, which he said is a bubble and will eventually collapse. Horwitz noted that in the event of a bubble burst in equities, alternative assets like gold will benefit...'Over time, gold's going to go much higher, but in the near-term here, I don't think there's anything that's going to change the direction of where gold's headed. To me, it's chopping around here and it will go higher, but it may go lower first,' Horwitz told Kitco News. This would be a good buying opportunity for metals for investors with a longer time horizon, Horwitz said. 'If you have a long-term horizon and you're going to hold on to it, then you could buy anything, because again, it's going to rise in value, the question is when,' he said."
The Impending End Of A Mania -Zero Hedge
"The two closest analogs to today's excessive fundamental valuations for US stocks were the 2000 Tech Bubble and the culmination of the Roaring Twenties in 1929. Our work suggests that today's valuations are even higher than those two periods. The nifty fifty stock mania of 1972 is another comparable period that featured excessive valuations in a popular group of large cap growth stocks that became widely regarded as 'blue-chip' buy and hold positions. Institutions and retail investors were taught to cling to these stocks through thick and thin, throwing fundamental analysis and valuation principles out the window....From today's valuations, a mere cyclical mean reversion in stock market multiples implies a 50+% drawdown in prices. Yet, too many investors remain oblivious to these valuation risks. Many today have further been lulled into believing that central banks have their backs and will keep markets rising. Such bullish sentiment on the heels of recent Fed liquidity injections has emboldened a late cycle speculative push higher in the indices even as the market internals have been noticeably deterioratin....Ultimately, we believe combined fiscal and monetary stimulus will be applied in concert to combat the next market and economic downturn. We strongly believe that too many investors today are underestimating the future inflationary risk of this high likelihood....If one is going to buy stocks at all in this environment, one area that looks extremely attractive with low valuations and improving fundamentals is gold and silver mining stocks...After four years of base building, we believe they are poised to take off fundamentally and technically in a soon to be rising gold and silver price environment."
How we talk about China - and why it matters -CBC News
"The world is rapidly approaching a crossroads with Beijing, a point where nations will have to decide whether to treat the burgeoning superpower as a trading partner, a rival - or an active threat. Secret Chinese documents were released to media outlets recently which show how the Muslim minority Uighur population is being locked up in mass detention camps and subjected to 'systematic brainwashing.' Beijing's violent response to pro-democracy protests in Hong Kong revived grim memories of the 1989 Tiananmen Square massacre. So is China a competitor or an adversary? The answer to that question seems to depend on which country's leaders are answering it - how heavily Beijing has invested in their nations' markets, how badly their businesses want access to that vast Chinese market. 'For many years, folks were naive about Chinese motivations,' U.S. National Security Adviser Robert O'Brien told journalists during an on-the-record briefing in Halifax over the weekend....The confusion on display in Halifax over the question of whether the West has arrived at the threshold of a new Cold War was widespread....Lady Pauline Neville-Jones, a former top British diplomat and adviser to ex-U.K. prime minister David Cameron, said China has signaled it intends to become an 'unequalled' high-tech nation...'We are feeding something that could be a monster,' she told the forum....The Halifax forum has embarked on what it is calling a 'China Initiative', with an aim of developing a coherent, comprehensive strategy for Western governments."
OK Boomer, Who's Going to Buy Your 21 Million Homes? -Wall Street Journal
"Baby boomers are getting ready to sell one quarter of America's homes over the next two decades. The problem is many of these properties are in places where younger people no longer want to live. The same demographics that propelled Sun City, Arizona's rise now pose an existential challenge to this suburb as baby boomers age. More than a third of Sun City's homes are expected to turn over by 2027 as seniors die, move in with their children or migrate to assisted living facilities, according to Zillow. Nearly two thirds of the homes will turn over by 2037. The big question looming in this neighborhood - and dozens of others like it in the Southeast and Rust Belt - is what happens to everything from home prices to the local economy when so many homes post 'For Sale' signs around the same time? The U.S. is at the beginning of a tidal wave of homes hitting the market on the scale of the housing bubble in the mid-2000s. This time it won't be driven by overbuilding, easy credit or irrational exuberance, but by an inevitable fact of life: the passing of the baby boomer generation....By 2037, one quarter of the U.S. for-sale housing stock, or roughly 21 million homes will be vacated by seniors. That is more than twice the number of new properties built during a 10-year period that spanned the last housing bubble....The consequences of a housing sales glut are potentially wide-reaching. A mismatch between supply and demand in places like Florida, Arizona and Nevada could offer new fiscal challenges that are already familiar to aging cities of the Rust Belt."
11.25.19 - Hong Kong Protesters Get A Win
Gold last traded at $1,456 an ounce. Silver at $16.88 an ounce.
NEWS SUMMARY: Precious metal prices eased slightly Monday amid mixed signals on China trade deal. U.S. stocks rallied to record highs on increasing expectations that China and the U.S. will reach a trade deal.
Why Gold Is More Than a Safe Haven Asset -TheStreet
"Gold, known as the safe haven asset, historically becomes more valuable during times of geopolitical turmoil. Approximately 20% of the above-ground stock of gold reserves is held by central banks and international monetary organizations. In addition, gold and the U.S. dollar typically have an inverse relationship since international gold is dollar-denominated. Weakness in the dollar pushes up gold prices and vice versa, though that has not been the case in 2019 as we have seen the prices of gold and the U.S. dollar increase in tandem....China was the world's largest gold producer in 2018 and accounted for approximately 12% of total global production, followed by Australia, Russia, the United States and Canada....Gold mining production has not changed significantly since 2016. One reason is that the 'easy gold' has already been mined and miners now must dig deeper to access quality gold reserves. This has led to additional problems as miners are exposed to new hazards, and the environmental impact is heightened. In short, it costs more to get less gold. These factors add to the costs of gold mine production, sometimes resulting in higher gold prices....Gold is scarce and a majority of exploration activity by gold mining companies does not find commercially viable quantities of gold. Once a suitable ore body is identified it generally takes at least ten years to develop a large-scale gold mine."
Why Now Is a Good Time to Start Worrying About a U.S.-China Trade Deal -Bloomberg/Yahoo Finance
"Now is a good time to start worrying about that trade deal. No, nothing bad has happened yet...The outlines of a phase-one trade deal are appearing more solid by the day and if recent history is a guide, this is when things go wrong. The first example was back in May 2018, when Chinese Vice Premier Liu He traveled to Washington and seemed to strike a deal to avoid tariffs. That didn't stick of course. President Donald Trump decided to go ahead with levies, leaving Beijing to fume about American flip-flops. A replay occurred in May this year. Trump again raised tariffs on Chinese goods as the two sides appeared to near a deal, but this time it was Washington that accused Beijing of going back on previously agreed to terms. Here we are again?...House Speaker Nancy Pelosi has sent Trump legislation supporting Hong Kong protesters, and the president is expected to sign the bill into law. Beijing, which has publicly pledged retaliation, will find it difficult not to follow through. Whether that combination is enough to derail a trade deal is an open question....Trade tensions, a shaky outlook for the world economy and the risk of a catastrophic conflict dominated discussions on the first day of the Bloomberg New Economy Forum in Beijing. Former U.S. Secretary of State Henry Kissinger said the U.S. and China were in the 'foothills of a Cold War,' and warned that the conflict could be worse than World War I if left to run unconstrained."
Hong Kong Protesters Get A Win, Setting Stage For Foggy China Relations -Forbes
"Anyone who thought the month's long pro-democracy protests were going nowhere just has to read Monday's headlines about Sunday's District Council elections in Hong Kong. These are the small, local races that pro-Communist Party (CCP) leaders have taken hold of in recent years, only to be kicked out of office, one by one, in a record turnout yesterday. Pro-Beijing district councilors saw their control of Hong Kong's 18 districts decline to one....This weekend's election showed the bulk of Hong Kongers are in favor of the 'universal suffrage' demand being made by the protesters. Universal suffrage is the right for adults to vote, regardless of socioeconomic status or political affiliation....More than 2.7 million people cast their vote on Sunday...Voter turnout was 71% versus 47% in the last District Council election held in 2015....Assuming the One Country, Two Systems arrangement remains in effect as promised until 2047, the question for young college students - who may have voted for the first time on Sunday - is what will they do in their 40s when Hong Kong is just another Chinese province?...Investors will see Sunday as a cooling-off period for protests; protests which, should they continue, put Hong Kong's special trading status with the United States at risk."
Bloomberg Enters Crowded Democratic Race -Wall Street Journal
"Billionaire Michael Bloomberg's essentially limitless budget for his Democratic presidential bid adds uncertainty to an already crowded and unsettled race while increasing the odds of a prolonged nominating battle in a contest that has yet to produce a definitive front-runner. The 77-year-old former New York City mayor announced his bid on Sunday after indicating earlier this month he might enter the race. Mr. Bloomberg faces a tough path to the nomination given his late entry and lack of a campaign apparatus, though he will try to start to overcome that using a national-television ad campaign this week with a price tag that would be high even for a presidential nominee the week before a general election. The co-founder and the majority owner of financial data and media company Bloomberg LP is expected to run as a centrist who could draw supporters from candidates such as former Vice President Joe Biden, Minnesota Sen. Amy Klobuchar and Pete Buttigieg, the mayor of South Bend, Ind....'I'm running for president to defeat Donald Trump and rebuild America,' Mr. Bloomberg said in a statement....By self-funding his campaign, Mr. Bloomberg almost certainly won't qualify for the next Democratic debate, in December....The former mayor's decision comes just nine months after he said he wouldn't run for president because of the difficulty in winning the Democratic Party's nomination. But his aides said earlier this month that he was concerned the current crop of 2020 candidates couldn't defeat Mr. Trump next November."
11.22.19 - 'They're Both Wrong' by John Tamny
Gold last traded at $1,465 an ounce. Silver at $17.05 an ounce.
NEWS SUMMARY: Precious metal prices rose slightly Friday on safe haven buying despite a firmer dollar. U.S. stocks wrapped up the market’s first weekly decline in over a month amid lingering worries around U.S.-China trade talks.
Gold prices set for a second weekly gain in a row -Marketwatch
"Gold prices climbed Friday but reversed an early gain...after data showing November gains in the U.S. manufacturing and services indexes and a rise in consumer sentiment buoyed benchmark stock indexes....Gold hung onto a gain Friday, albeit a modest one, following weak economic data from Europe and against a backdrop of trade worries. The yellow metal is rising as 'Europe stagnates, trade uncertainty persists and as the Hong Kong situation seems to be coming to a head,' wrote Edward Moya. senior market analyst at Oanda, in a daily research note....Meanwhile, legislation on Hong Kong that allows for the U.S. to rescind Hong Kong's special status is now being passed to President Donald Trump. Those geopolitical events and fitful progress toward a U.S.-China trade agreement have supported the long-term bull case for bullion."
Book Review: 'They're Both Wrong' by John Tamny -Big Jolly
"John Tamny's new book, They're Both Wrong: A Policy Guide for America's Frustrated Independent Thinkers, available next week, is going to make people think, and for the partisans on either side, it will hopefully make them ask questions about their own arguments....In his opening chapter, Tamny lays out that our obsessed political culture (my words, not his) was not the vision of the Founders as prescribed by the Constitution, which 'as written made it possible for Americans to have very little interest in politics, and particularly national politics.' The Constitution's 'few and defined' powers meant that people could live the lives they wanted as almost all government that actually affected them was local....'My view is that both Democrats and Republicans have turned the Constitution on its head by virtue of both parties presuming to govern us from Washington, DC, as opposed to each leaving us free to choose our policy bliss through our choice of city or state.' Later on in defining all levels of government programs, Tamny further clarifies, 'most government and government services should be local, and it will be understood that if these programs are going to be offered by government, they should be offered locally, if at all.' Precisely. From there, John Tamny launches into critiques of arguments from both major political parties with regard to various issues such as immigration, global warming, taxes, spending, the minimum wage, charitable giving, free trade, school choice, stimulus spending, and more. He does all of this from an economic perspective, looking at what markets recognize and how they function, and how government seemingly fails to realize that individuals are the market, that 'economies are just individuals.' Politicians tinkering with the economy is not only unnecessary, it is usually counterproductive. Tamny’s argument can be further boiled down to calling attention to government spending and what the real economy, what he terms the 'productive economy,' loses for every one dollar that the federal government spends. The argument is both fundamental and utterly fascinating. This is also not a new concept per se, it is just ignored by the politicians of today."
World's largest hedge fund bets over $1 billion on a big stock market sell-off soon -CNBC
"The largest hedge fund in the world has reportedly staked more than $1 billion that global equity markets will fall during the next three months. The wager placed by Ray Dalio's Bridgewater Associates would pay off for the firm if either the S&P 500 or the Euro Stoxx 50 or both decline....The bet uses put options - assembled over months by Goldman Sachs and Morgan Stanley - that give investors the option of selling stocks at a predetermined price by a given date. The firm paid about $1.5 billion for the contracts, about 1% of Bridgewater's $150 billion in total assets under management, the report said....Doubts about a trade truce have crept higher over the last week, especially on the heels of the U.S. Senate’s unanimous vote on Tuesday to support Hong Kong's anti-government protesters. China, in response, said the U.S. was interfering in internal affairs....Dalio has been less than rosy in his projections for future relations between Washington and Beijing. 'There is a trade war, there is a technology war, there is a geopolitical war, and there could be capital wars. And how that's approached is going to determine what our futures are like,' Bridgewater's billionaire founder said last week."
Let The People Decide Trump's Fate -Buchanan.org
"Was there linkage between the withholding of U.S. military aid and the U.S. demand for a Ukrainian state investigation of the Bidens? 'Was there a quid pro quo?' This question has bedeviled this city for months now. 'The answer is yes,' said U.S. Ambassador to the EU Gordon Sondland in sworn testimony on Wednesday....'They knew what we were doing and why. … Everyone was in the loop. It was no secret.' And so where are we headed now? The House intel and judiciary committees will advance one or more articles of impeachment against Donald Trump to the House floor, where they will be agreed upon in party-line votes and sent to the Senate for trial. Impeachment appears as inevitable as anything in politics today....As the goal of the more rabid anti-Trumpers is to impeach, convict and remove the president, and then proceed with civil and criminal charges, this looks to be a fight to the death....If Trump imperiled 'national security' by withholding for two months this latest tranche of military aid, did not Obama more gravely imperil our national security by denying Ukraine lethal aid for years?....Even before his first day in office, President Trump was in the gun sights of the 'deep state' and its media auxiliaries....Bottom line: If this country is not to be torn apart for a decade, the decision to retain or remove President Trump should be made by those who put him in the White House and not by rabid partisans like Adam Schiff."
11.21.19 - Can Bloomberg's Billions Buy Presidency?
Gold last traded at $1,463 an ounce. Silver at $17.06 an ounce.
NEWS SUMMARY: Precious metal prices steadied Thursday on mixed economic and trade signals. U.S. stocks fell for a third day as investors digested the latest reports surrounding the U.S.-China trade war.
4 Trends To Watch As Gold Prices Soar -Yahoo Finance
"There's a common saying 'hope for the best, but prepare for the worst'... And that's never been more true than in today's markets. Just spend 5 minutes watching the news...The UK is looking down the barrel of an economically crippling no-deal Brexit...One of the world's top financial hubs, Hong Kong, is teetering on the edge...Germany's manufacturing sector is collapsing...And the U.S.-China trade war is taking domestic victims left and right. It's safe to say that the global economy has seen better days. And according to economists and veteran market analysts alike...It's about to get a whole lot worse. Of course, we should hope for the best. No one is actually hoping for a global recession, after all...But it is time to start preparing for the worst. And what's the best way to hedge against a potential global recession? Gold. Investors are piling into gold in a big way. The market has never been hotter. Some are even saying that $2,000/oz gold may be on the horizon."
US Relations With China Were Just Destroyed, And Nothing Will Ever Be The Same Again -Zero Hedge
"Our relationship with China just went from bad to worse, and most Americans don't even realize that we just witnessed one of the most critical foreign policy decisions of this century. The U.S. Senate just unanimously passed the 'Hong Kong Human Rights and Democracy Act of 2019', and the Chinese are absolutely seething with anger. Violent protests have been rocking Hong Kong for months, and the Chinese have repeatedly accused the United States of being behind the protests. Whether that is true or not, the U.S. Senate has openly sided with the protesters by passing this bill, and there is no turning back now....To the Chinese government, this move by the U.S. Senate is essentially an assault on China itself. They are going to argue that the U.S. is inciting a revolution in Hong Kong....The Chinese take matters of internal security very seriously, and the status of Hong Kong is one of those issues that they are super sensitive about. China will never, ever compromise when it comes to Hong Kong, and if the U.S. keeps pushing this issue it could literally take us to the brink of a military conflict. And you can forget about a comprehensive trade agreement ever happening....The trade deal that President Trump was trying to put together was already on exceedingly shaky ground. 'Phase one' was extremely limited, nothing was ever put in writing, and nothing was ever signed....'If we don’t make a deal with China, I'll just raise the tariffs even higher,' Trump said. Unfortunately, raising tariffs isn't going to fix anything at this point. In fact, Trump can raise tariffs until the cows come home but it isn't going to cause the Chinese to budge....The U.S. and China are now enemies, and ultimately that is going to result in a tremendous amount of pain for the entire planet."
Why investors in U.S. stocks shouldn't underestimate Hong Kong as a big risk -Marketwatch
"The U.S. Congress has unanimously challenged the Chinese government at a critical time for trade talks. In a boost for Hong Kong's pro-democracy protestors, the House and Senate each passed the Hong Kong Human Rights and Democracy Act. Clearly politicians have the guts to show that, for them, it is not all about money. However, for the momo (momentum) crowd in the stock market, it is all about money, and they dislike Congress' decision....The probability is high that Trump may not back Congress and stay focused on getting phase one of the trade deal done. However, Congress may not give Trump a choice, and Trump may be forced to veto a bill. In this scenario, there are likely to be enough votes to override his veto. Investors should not dismiss the Hong Kong issue. Wall Street is assuming that phase one of the trade deal will get done. If it does not get done, watch out below."
Can Bloomberg’s billions buy the presidency? -Ponte/World Net Daily
"'It is time for a wealth tax,' says Sen. Elizabeth Warren, D-Mass., in a new ad on CNBC that identifies four billionaires and openly appeals to viewer envy. These billionaires, however, are not her primary target. Warren is a front-runner in the race to become the 2020 nominee of a Democratic Party skyjacked by leftists. She could be the next president of the United States, but first she must subtly demonize and defeat a new contender: former three-term mayor of New York City Michael Bloomberg. 'Mike Bloomberg has more money than God,' says political pollster Frank Luntz. The founder of Bloomberg News, a slightly center-left giant business news service, Bloomberg could let other Democratic contenders drain their finances on the first four primaries. He could then enter the Super Tuesday vote next March 3 'with more money than all of them,' says Luntz, '[and] potentially more money than all of them combined.'....How rich is Michael Bloomberg? Donald Trump, age 73, today has a net worth of roughly $3.1 billion, according to Forbes, which makes him the 259th wealthiest person in the United States and 715th richest person in the world. Bloomberg, by comparison, is worth roughly $52.3 billion, making him the ninth richest person in the U.S. and 14th wealthiest person in the world. He has not yet declared himself a 2020 presidential candidate, but he met the filing deadline for Alabama and Arkansas. Bloomberg represents more than the Democrats' own version of billionaire Donald Trump. Like Trump, Bloomberg has been so wealthy that he could not be corrupted or 'bought' by political donors and special interest groups....Like Trump, Bloomberg could afford to follow his own mix of right and left ideas...Mayor Bloomberg was a nanny statist control freak who tried to regulate not only guns but also how much soda pop, salt and transfats citizens consume and where they could smoke....Now 77, Bloomberg has the human warmth of a technocratic robot who stands 7 inches shorter than Trump. In presidential races the taller candidate usually wins."
11.20.19 - World's Rich Are Seeking Old -Fashioned Security
Gold last traded at $1,468 an ounce. Silver at $17.06 an ounce.
NEWS SUMMARY: Precious metal prices steadied Wednesday ahead of the latest Fed minutes release. U.S. stocks pulled back from record highs as investors took a pause to asses the trade situation and a batch of retail earnings.
U.S. Stocks Slip as Trade Talks Flounder -Wall Street Journal
"U.S. stocks fell Wednesday as trade talks between the U.S. and China appeared to near an impasse, with President Trump threatening to raise tariffs further....Investors are growing concerned that relations between the world's two biggest economies may be further strained after the U.S. Senate passed a bill in support of Hong Kong's antigovernment protesters....'The Chinese aren't very happy about that bill progressing,' said Paul Flood, multiasset portfolio manager at Newton Investment Management. 'It does make the tariffs discussion more difficult.' A breakdown in the trade talks would derail the White House's plans for a limited 'phase one' agreement this year. Investors are also growing concerned that fresh tariffs on Chinese products including smartphones and toys may be put into effect Dec. 15, directly hitting American consumers. Mr. Trump said in a Tuesday cabinet meeting that China needs to make a deal he likes to avoid levies going even higher."
'1984' in China -New York Times
"Communist leaders engage in modern-day totalitarian brainwashing, bizarre lies and industrial-level indoctrination to suppress Muslims. 'Ying shou jin shou' - 'Round up everyone who should be rounded up.' The echo of '1984,' 'Brave New World' or 'Fahrenheit 451' is unmistakable. But this is not dystopian fiction. It's a real bureaucratic directive prepared by the Chinese leadership, drawing on a series of secret speeches by Xi Jinping, China's authoritarian leader, on dealing ruthlessly with Muslims who show 'symptoms' of religious radicalism. This modern-day totalitarian brainwashing is revealed in a remarkable trove of documents leaked to The New York Times by an anonymous Chinese official....That someone from within the unforgiving, secretive Chinese leadership would take the enormous risk of leaking 403 pages of internal documents to a Western newspaper it becomes clear from the documents that Mr. Xi is far more concerned by any challenge to the Communist Party's image of strength than foreign reaction....International outrage could turn that into a wake-up call for China's leaders, despite their totalitarian swagger, if the world begins to see them as pariahs, not just trading partners."
Editor's Note: The so-called 'China trade deal' makes headlines daily; but analysts doubt a fair, long-term China trade deal will ever happen. Meanwhile, financial markets are hanging on every shred of news - fake and real. The truth is, China is waging a very deceptive economic war against the U.S. that's putting your savings and investments at risk. Swiss America chairman Craig R. Smith has just released his newest Special Report: CHINA'S TOP SECRET WAR. In it you will discover why communist China's grand strategy is nothing less than world domination, not simply arriving at a temporary, stock market-boosting trade agreement. Call 800-289-2646 or CLICK HERE to request your free copy of CHINA'S TOP SECRET WAR.
Breakdown in U.S.-China talks to send gold surging above $1,500 -Kitco
"A total breakdown of U.S.-China talks could potentially trigger a global recession and send gold prices above $1,500 an ounce, according to FXTM. 'A complete breakdown in the current trade talks should send Gold surging back above $1,500 while potentially paving the way for a global recession,' writes FXTM market analyst Han Tan. As markets start to doubt the progress surrounding the 'Phase I' trade deal, gold is gaining ground. But, even if a limited deal is signed, gold is still likely to end the year 'with its double-digit annual gain intact,' FXTM says. A new potential obstacle on the horizon is the U.S. Senate passing legislation in support of the Hong Kong protests. 'Such a move threatens to drive a wedge into ongoing U.S.-China negotiations while potentially raising the barrier to a trade deal,' the market analyst writes."
World's Rich Are Rattled and Seeking Old-Fashioned Security -Yahoo Finance
"From London to Switzerland to parts of the U.S., the rich are looking to store precious metals, cash and cryptocurrency. For some, it's the threat of a global recession. Others are avoiding bank deposits as negative interest rates force lenders to charge for holding cash. Many are concerned about natural disasters. Hedge fund titan Ray Dalio captured the anxiety last month when he warned the global economy is under threat from an explosive mix of ineffective monetary policy, a widening wealth gap and climate change. A majority of wealthy investors are stockpiling cash in anticipation of a sharp market drop before the end of next year, according to a survey of clients from UBS Global Wealth Management. 'We've seen extraordinary demand for safe-deposit boxes ever since we started offering them in 2015, and that demand has really gone up since the late summer,' said Ludwig Karl, a spokesman for Swiss Gold Safe Ltd., which operates high-security alpine vaults. 'Most people say they are planning for difficult economic circumstances.'....There are more than 25 million safe-deposit boxes by some estimates in the U.S. alone...A private collector held the Crown of the Andes, made with 5.3 pounds of gold and more than 400 emeralds, in a Citibank box before its sale four years ago to the Metropolitan Museum of Art."
11.19.19 - China Diversifies Away From US Dollar
Gold last traded at $1,474 an ounce. Silver at $17.11 an ounce.
NEWS SUMMARY: Precious metal prices rose Tuesday on bargain-hunting and a weaker dollar. U.S. stocks traded lower as losses in Home Depot outweighed a rise in Boeing shares.
Why You Should Secure Your Money in Gold -Casey/Bonner And Partners
"It's an unfortunate historical anomaly that people think about the paper in their wallets as money. The dollar is, technically, a currency. A currency is a government substitute for money. But gold is money....There's nothing magical about gold. It's just uniquely well-suited among the 92 naturally occurring elements for use as money…in the same way aluminum is good for airplanes or uranium is good for nuclear power....What are the characteristics of a good money? Aristotle listed them in the 4th century BCE. A good money must be all of the following: 1. Durable: A good money shouldn't fall apart in your pocket nor evaporate when you aren't looking. It should be indestructible....2. Divisible: A good money needs to be convertible into larger and smaller pieces without losing its value, to fit a transaction of any size....3. Consistent: A good money is something that always looks the same, so that it's easy to recognize, each piece identical to the next....4. Convenient: A good money packs a lot of value into a small package and is highly portable....5. Intrinsically valuable: A good money is something many people want or can use....Actually, there's a sixth reason Aristotle should have mentioned, but it wasn’t relevant in his age, because nobody would have thought of it… 6. It can't be created out of thin air....If you try to make airplanes out of lead, or money out of paper, you're in for a crash. That gold is money is simply the result of the market process, seeking optimum means of storing value and making exchanges."
Hong Kong university becomes a battleground -Vox
"The campus of a Hong Kong university transformed into an apocalyptic scene on Monday as riot police armed with tear gas and rubber bullets surrounded pro-democracy protesters. The standoff between authorities and protesters at Hong Kong Polytechnic University has turned into one of the fiercest, most violent conflicts in the nearly six months of protests in the autonomous territory. What began as a movement to block a controversial extradition bill morphed into a sustained call for greater democratic rights in Hong Kong and a pushback against the growing influence of China....Some demonstrators have managed to sneak away; photographers documented people running along a footbridge away from campus. But others are holed up, waiting for an opportunity to break free and avoid arrest....Hong Kong officials said they were allowing the Red Cross to enter the campus and treat injured protesters. Other supporters - including parents of some students at the university - staged a sit-in outside campus. They carried signs that said 'Save our Kids.'....At least 150 people were arrested over the weekend, according to the New York Times. That number is likely to rise, though, as about 500 protesters were still believed to be trapped inside campus well past midnight local time....On Monday, the Chinese government warned that 'no-one should underestimate' Beijing's will 'to safeguard its sovereignty and Hong Kong’s stability.'...The campus unrest also threatens to derail upcoming local elections in Hong Kong, scheduled for this weekend, where pro-democracy lawmakers are expected to win big."
China diversifying FX reserves, assets to counter US dollar exposure -CNBC
"China is heavily exposed to the U.S. dollar, but now, with the risk of 'decoupling,' Beijing is silently diversifying its reserves to reduce its dependence on the world's largest reserve currency, analysts say. Ongoing trade tensions with the U.S. has 'increased the risk of a financial decoupling' between the two largest economies, ANZ Research said in a recent report. The White House reportedly considered some curbs on U.S. investments in China such as delisting Chinese stocks in the U.S....'The pace of diversification into other currencies will likely quicken going forward,' ANZ says in the report, adding that the share of the dollar in the country's foreign exchange reserves was estimated to be around 59% as of June. Meanwhile, Beijing is gradually reducing its holdings of U.S. Treasurys, which it is heavily invested in - China was the largest foreign holder until June, when it was surpassed by Japan. Since peaking in 2018, China has reduced its holdings by $88 billion in the last 14 months, DBS said in a note....The world's second-largest economy has been pushing for greater, more globalized use of the yuan. Efforts are likely to continue to reduce the world's reliance on the dollar, said Roache."
Keeping Up with the "Joneses" -Becoming Minimalist
"Rather than trying to 'keep up with the Joneses,' try to 'keep up with the person you want to be.' It is, almost certainly, different than the life the Joneses are living. Society has an interesting affect on us. Too often, it calls us to conform. Think of the changing styles and how quickly the masses adopt them....'Keeping up with the Joneses' is, by its very nature, a pursuit of conformity. We want what they have, or buy what others are talking about, or click-to-ship the same product everyone else is buying on Black Friday. But one of the rarely mentioned side effects of conforming to the life that others are living is the complete and total loss of individuality...Deep down, do we even want those things? Do we even want to change our clothing styles?....Live your life ignoring conformity. Pursue those things that bring you fulfillment and significance and meaning."
11.18.19 - Catastrophic China War 'Inevitable'
Gold last traded at $1,472 an ounce. Silver at $17.01 an ounce.
NEWS SUMMARY: Precious metal prices rose Monday amid growing U.S.-China trade deal pessimism. U.S. stocks pulled back from record highs as investors digested mixed signals around U.S.-China trade talks.
Gold firms on US-China trade deal pessimism -CNBC
"Gold prices firmed on on Monday after CNBC reported Chinese officials are pessimistic about the prospect of a U.S.-China trade deal, following a report of 'constructive talks' over the weekend. The mood in Beijing about a trade deal is pessimistic due to President Donald Trump's reluctance to roll back tariffs, which China believed the U.S. had agreed to, a government source told CNBC's Eunice Yoon....Chinese state media Xinhua reported Washington and Beijing had a high-level phone call on Saturday and that the two sides discussed each other's core issues for the first phase of an initial trade agreement....Meanwhile, investors also kept a close eye on developments in Hong Kong, with police on Monday trapping hundreds of protesters inside a major university and demonstrators rampaging through a tourist district, after almost two straight days of standoffs. Gold is considered a safe store of value during times of economic or political uncertainty."
Too Much Money Pushing up Prices, It Ends With a Guillotine -Blain/Zero Hedge
"To be brutally frank - we all know what the problems are: Too much money in the markets pushing up the prices of market assets. The fact is too much of that too much money is owned by too few people who use their too much money to buy all these financial assets. These too few people who own all the financial assets get richer everyday as their too much money makes their too many financial assets even more valuable. And these too few people get even richer by getting even more too much money to put into the already too expensive financial markets by 'persuading' central banks to keep rates low, to buy financial assets through QE, and get their in-the-pocket politicians to enact tax cuts so their too much money is even more too much money…With me so far?? Meanwhile, politicians pay for the too much money they give to too rich people, by taking it away from the much more numerous too many too poor people through Austerity. The too many people who don't have any assets and owe any money they have to the people who have too much money and too many assets - aren't happy. They blame society, they blame governments and as they get even more unhappy they get angry. These too poor, too angry people then get very angry and start blaming people, which is what is happening across the globe. Still there?... Ultimately, it gets messy. The too many poor people set up a very sharp razor in the center of a square in the capital of their country and start teaching the too few people with too much money and too many assets, that these are essentially worthless if their heads are cut off."
'Catastrophic' conflicts unless China and US settle differences -Kissinger/South China Morning News
"Conflict between the United States and China will be 'inevitable' and result in 'a catastrophic outcome' that 'will be worse than world wars' unless the countries settle their differences, according to former US secretary of state Henry Kissinger. 'We are in a difficult period now. I am confident the leaders on both sides will realize the future of the world depends on the two sides working out solutions and managing the inevitable difficulties,' he said at an event hosted by the National Committee on US China Relations in New York on Thursday. 'There is no doubt many aspects of the evolution of China are challenging to the US,' the 96-year-old said. 'It never happened before that two major countries in different parts of the universe were in similar positions.' But they must understand that a permanent conflict between them could not be won and would end in 'a catastrophic outcome' for Beijing and Washington, he said. If no resolution was achieved, 'it will be worse than the world wars that ruined European civilization', he said. 'It's no longer possible to think that one side can dominate the other,' he said."
Facts poll: Americans struggle to ID true facts -Associated Press
"In a sharply divided country, here's something many Americans agree on: It's hard to know what's a true and honest fact. A new poll from The Associated Press-NORC Center for Public Affairs Research and USA Facts finds that regardless of political belief, many Americans say they have a hard time figuring out if information is true. Nearly two-thirds of Americans say they often come across one-sided information and about 6 in 10 say they regularly see conflicting reports about the same set of facts from different sources. 'It is difficult to get facts. You have to read between the lines. You have to have a lot of common sense,' said Leah Williams, 29, of Modesto, California. A Republican, Williams says she relies on like-minded friends and family to help sort through conflicting information. 'There are wolves in sheep's clothing everywhere.' The poll found that 47% of Americans believe it's difficult to know if the information they encounter is true, compared with 31% who find it easy to do so....The poll found majorities say they have little to no confidence in information they get about the government from social media, the president, members of Congress and businesses."
11.15.19 - 70% of Americans are Struggling
Gold last traded at $1,468 an ounce. Silver at $16.94 an ounce.
NEWS SUMMARY: Precious metal prices steadied Friday on mixed economic signals. U.S. stocks rose after White House economic advisor Larry Kudlow said China and the U.S. were getting close to reaching a trade deal.
How much gold do you really need to have the optimal portfolio? -Kitco "The amount of gold to hold in a portfolio that optimizes an investor's risk/return profile is much higher than what most would hold, this according to Ryan Giannotto, director of research at GraniteShares. 'We have found that the efficient level, the optimized level, was 35% gold. Not saying you should own 35% gold, that's an awfully high concentration, but it challenges the conventional wisdom of what pertains to gold and how to use it,' Giannotto told Kitco News. Additionally, gold serves as an excellent hedge instrument as its performance is independent of other financial assets, Giannotto noted. 'Gold's correlation to the market, or indeed any other economic force, is essentially zero,' he said. There are three primary uses of gold in a portfolio, according to Giannotto: to hedge against interest rates, to use as a store of wealth, and moderate and diversify investments. 'Those three together are very powerful,' he added."
Review: 'The China Hustle': The Most Important Film of 2018 -Forbes
"The most important movie of 2018 is one you may not have even heard of. But it's a story that could be directly affecting you, endangering your financial stability and your future. The film is The China Hustle ...and it is a klaxon warning of potentially impending economic disaster. From the producers of the Oscar-nominated Enron: The Smartest Guys In The Room, The China Hustle is directed by Jed Rothstein, director of the Academy Award nominated documentary Killing in the Name. This isn't an expose of a foregone scandal, mind you, but rather an ongoing one with major implications for our economy and that of China....Unlike many documentaries about finance, economics, and related frauds, The China Hustle is what some folks would call 'accessible' for mainstream viewers with little knowledge of how stock markets and investments work....Imagine you do lawn work for a living, mowing yards and trimming hedges and whatnot. Let's say you work on maybe 10 yards per week, and let's say you have one or two people who help you do the work. Okay, now imagine someone comes to you from another country - let's make one up, the imaginary country of Fraudland - and they tell you, 'Hey, I can put your company on the stock market in Fraudland, and make you rich.' This obviously sounds good to you, so they continue to explain how it works: 'To do it, you have to be tied to a company in Fraudland, so you'll merge with an old defunct paper company and then change its name to your own company's name. Then we can put you on the stock market in that country, and we'll get investors and banks etc there to recommend your company stock, we'll say you're ten times bigger than you are and that you do 1,000 yards per week, and we'll drive up the stock price and inflate the value of your company.'...'If we get caught, the banks and firms there in that country will pay some fines, but you'll still get rich and you can't go to jail because here in your country it's not illegal to defraud and take the money from those investors in Fraudland. There's no reason not to do it!' That, in a very simplified nutshell, is what's going on in The China Hustle. Small companies in China were merged with shell companies in the U.S., put on the stock exchanges, and then claim earnings, revenue, business, and so on that's all far in excess of what the company is really doing. If they're making $10 million, they might claim they're making $100 million....It's a scary story, even as it often tends to confirm things we already know or at least suspect about the financial system and those who use it to line their own pockets at the expense of everybody else. The China Hustle is a briskly paced, easy to understand, humanizing look at what is being called one of the biggest financial frauds in history." (Watch The China Hustle trailer)
America's Federal Budget On 'Unsustainable Path,' Warns Fed Chair Jerome Powell -Daily Caller
"Federal Reserve Chair Jerome Powell warned Wednesday that the federal budget is on 'an unsustainable path' due to rising levels of federal debt. Powell told the Joint Economic Committee that the 'high and rising federal debt,' which now tops $23 trillion, could make it difficult for the economy to recover from future market downturns. 'In a downturn, it would also be important for fiscal policy to support the economy. However, as noted in the Congressional Budget Office's recent outlook, the federal budget is on an unsustainable path with high and rising debt,' said Powell. 'Over time, this outlook could reduce fiscal policy makers' willingness or ability to support economic activity during a downturn. In addition, I remain concerned that the high and rising federal debt can in the longer term restrain private investment and thereby reduce productivity and overall growth,' he continued. The federal government ran a nearly $1 trillion deficit over the past fiscal year, according to a Nov. 7 report released by the Congressional Budget Office (CBO)....The national debt has been largely absent from the 2020 presidential race, even as it continues to grow."
70% of Americans say they are struggling financially -CBS News
"Many Americans remain in precarious financial shape even as the economy continues to grow, with 7 of 10 saying they struggling with at least one aspect of financial stability, such as paying bills or saving money. The findings come from a survey of more than 5,400 Americans from the Financial Health Network, a nonprofit financial services consultancy. The project, which started a year ago, is aimed at assessing people's financial health by asking about debt, savings, bills and wages, among other issues. Despite solid U.S. economic growth this year, the share of Americans who are struggling financially remains statistically unchanged from a year ago, said Rob Levy, vice president of research and measurement with Financial Health Network. The study adds to a body of research indicating that millions of American families have trouble making ends meet even a decade after the Great Recession and as unemployment has sunk to its lowest level in decades. For instance, centrist think tank the Urban Institute has found that 4 in 10 Americans struggle to pay for basic needs such as groceries or housing. And a Zillow report released Thursday found that roughly a quarter of renters say that affording their payments is difficult or very difficult. Overall, about 3 in 10 Americans are considered financially healthy, the findings show."
11.14.19 - Moody's Issues Worldwide Debt Warning
Gold last traded at $1,469 an ounce. Silver at $16.92 an ounce.
NEWS SUMMARY: Precious metal prices rose Thursday amid declining investor risk appetite. U.S. stocks traded near flat line amid persisting worries around U.S-China trade relations.
Gold: US-China 'Snag', Lower Demand for Risk, Supporting Short-Covering Rally -FX Empire
"Gold is expected to continue to inch higher on short-covering as long as there is tension between the U.S. and China. Gold could spike higher if those tensions escalate. Gold prices are trading higher for a second session on Thursday as some of the weaker shorts continue to cover positions...Gold traders are likely reacting to falling Treasury yields, weaker demand for risky assets and a lower U.S. Dollar....The catalysts behind the price action are renewed concerns over U.S.-China trade relations. So far this week, gold has recovered about $25.00 of its recent $72.00 break... Gold appears to be going through a normal short-term correction, following a sharp break. The weaker shorts are being spooked by concerns over the lack of progress being made on the trade deal. Traders also fear the tension between the United States and China could flare at any time especially after U.S. President Trump on Wednesday threatened to ramp up tariffs on Chinese goods if the countries failed to reach a deal on trade. Furthermore, the Wall Street Journal reported on Wednesday that U.S.-China trade negotiations had ‘hit a snag’ over farm purchases, with China not wanting a deal that looked one-sided in favor of the United States."
Moody's issues debt downgrade warning to the entire world -London Telegraph
"Ratings agency Moody’s has issued a debt downgrade warning to the entire world on fears that political turmoil from Westminster to Hong Kong poses a threat to the economy. It cut its global sovereign outlook to 'negative' from 'stable' for 2020, cautioning that 'disruptive and unpredictable' politics was worsening the slowdown in growth. After warning of a possible ratings downgrade on UK sovereign debt last Friday, Moody's said populism and trade tensions globally raised the risk of bigger economic shocks and the ability of policymakers to counter them. Britain, Hong Kong, Argentina and South Africa were singled out as countries being monitored closely by the credit ratings agency amid political turbulence. 'Unpredictable politics create an unpredictable economic and financial environment, prone to volatility in financial and commodities markets and sharp shifts in sentiment.' It added the fragile global backdrop raised the risk of capital flight that would punish vulnerable countries with weaker credit ratings."
Treat China as the Nuclear Superpower It Is -Wall Street Journal
"A perilously neglected problem of the past 20 years or so is that China is no longer so bereft of nuclear weapons as to be dismissible. If the relationship among the now three dominant nuclear powers is not clarified and disciplined, China's maturing nuclear warfare capabilities will remain both a direct threat to the U.S. and a potent destabilizer of the balance of terror. We know of its rapidly growing families of silo-based, mobile, sea-based, and bomber-deliverable short-, intermediate-, and intercontinental-range delivery systems. We also know that China's nuclear infrastructure - including production and certain modes of deployment - is housed in an astounding 3,000 miles of elaborate tunnels. This means we have little knowledge of what China actually possesses, and because we cannot do without such intelligence, bringing China into a control regime is critical....Why would China possibly object? Unless of course more warheads and delivery vehicles than it admits to were to be secreted in the immense tunnel network known as the Great Underground Wall...The administration should vigorously pursue this initiative and refuse to let it drop or to treat it as a sacrificial chip in the trade war...What are the odds - contrary to common sense and to China's perceived interests, goals, ambitions, plans, declarations, and recent actions - that, taking into account the almost unimaginable 3,000 miles of tunnels, it has only the relatively small numbers of weapons."
'It's Not the Economy Anymore, Stupid' -Wall Street Journal
"President Trump has presided over solid economic growth and much lower unemployment than economists would have expected a few years ago, a record he proudly touted in a speech in New York Tuesday. Mr. Trump is counting on that record carrying him to re-election next year. Conversely, Democrats see hints of weakness, especially in manufacturing-intensive swing states, that could derail those plans. Yet both could be working from an outdated playbook. Polarized politics mean that voters' views of the economy are increasingly shaped by their party preference, rather than the other way around. And for some key voting blocs, noneconomic issues such as immigration, race relations and Mr. Trump himself have superseded economic concerns in determining their vote. Thus, absent a serious recession or spectacular boom, the economy may have little bearing on how Americans vote next year....There are signs economic trends' sway over presidential contests has weakened. Political scientists John Sides, Michael Tesler and Lynn Vavreck, authors of 'Identity Crisis: The 2016 Presidential Election Campaign and the Battle for the Meaning of America,' have found that from John F. Kennedy through George W. Bush, consumer confidence and presidential approval were positively correlated. But that correlation disappeared under Barack Obama and has been absent during Mr. Trump's three years in office. One reason is that 'partisan divides have put people into parallel universes when it comes to understanding and interpreting the economy,' said Jonathan Rothwell, principal economist at Gallup."
11.13.19 - World's Richest Brace for Stock Sell-Off
Gold last traded at $1,461 an ounce. Silver at $16.84 an ounce.
NEWS SUMMARY: Precious metal prices rose Wednesday on bargain-hunting amid trade uncertainty. U.S. stocks traded mixed as investors digested news around U.S.-China trade talks along with testimony from Fed Chairman Powell.
Gold rises as trade uncertainty hurts risk appetite -CNBC
"Gold prices gained on Wednesday on lack of clarity on the U.S.-China trade negotiations, keeping markets wary about the tariff war's toll on the health of the global economy. President Donald Trump said a trade deal was 'close' but gave no new details on when or where an agreement would be signed, disappointing investors in what was billed as a major speech on his administration's economic policies. He also rattled some investors by threatening China with even more tariffs if they do not sign a deal. 'Anything around (U.S.-China) trade talks are going to impact global sentiment...Protests in Hong Kong present major geopolitical risks, something that is going to continue fueling risk aversion,' said FXTM analyst Lukman Otunuga. 'The key concern is whether the U.S. would take a diplomatic stance with regards to Hong Kong. If the U.S. does make a move, it is going to link back to U.S.-China trade talks.'....'We believe gold's recent weakness is primarily a result of cooling sentiment in the futures market and some selling by short-term speculators, trend followers and technical traders...Current weakness represents a buying opportunity in our view,' Julius Baer analyst Carsten Menke said in a note."
Hong Kong police warn city on 'brink of total collapse' -BBC
"Hong Kong's rule of law has been pushed to the 'brink of total collapse' after more than five months of protests, police have warned. The warning came as protesters clashed with police across the city on Tuesday. At the Chinese University of Hong Kong, police fired tear gas and rubber bullets at protesters who built barricades on the campus. Earlier in the day, around 1,000 protesters rallied in central Hong Kong during the lunch hour blocking roads. Protesters, wearing office clothes, were seen chanting: 'Fight for freedom, stand with Hong Kong!'....Clashes erupted at the Chinese University of Hong Kong, with police firing tear gas to disperse students, while at City University there was a standoff between students and riot police which continued into the evening....Train stations were closed across the city. Monday's protests saw 260 people arrested bringing the number to more than 3,000 since the protests began in June."
Tariffs on China Imports Emerge as Hurdle to Trade Deal -Wall Street Journal
"Tariffs are emerging as the main stumbling block in efforts by the U.S. and China to come to a limited trade deal, a month after the two countries called a truce in their trade war. The logjam centers on whether the U.S. has agreed to remove existing tariffs in the so-called 'phase one' deal that the two countries have been working toward - or whether the U.S. would only cancel tariffs set to take effect Dec. 15, according to people familiar with the talks. 'The U.S. negotiators will try to exact the maximum they can before doing anything' on tariff relief, one of the people said. President Trump said Tuesday that a 'significant phase-one trade deal with China could happen, could happen soon.' But he added that he is prepared to increase pressure on China if the two sides can't reach an agreement. 'If we don't make a deal, we're going to substantially raise those tariffs, they're going to be raised very substantially,' Mr. Trump said in a speech to the Economic Club of New York....The American side has a potentially problematic negotiating arrangement. Typically, U.S. presidents set policy parameters, with senior officials working out the details. Yet under Mr. Trump senior officials often have the latitude to seek deals and dispute over policy themselves, with Mr. Trump making a decision at the end, accepting or rejecting a proposal based on economic, political or other considerations."
Some of the World's Richest Brace for a Major Stock Sell-Off -Yahoo Finance
"Wealthy people around the globe are hunkering down for a potentially turbulent 2020, according to UBS Global Wealth Management. A majority of rich investors expect a significant drop in markets before the end of next year, and 25% of their average assets are currently in cash, according to a survey of more than 3,400 global respondents. The U.S.-China trade conflict is their top geopolitical concern, while the upcoming American presidential election is seen as another significant threat to portfolios....Nearly four-fifths of respondents say volatility is likely to increase, and 55% think there will be a significant market sell-off before the end of 2020, according to the report which was conducted between August and October and polled those with at least $1 million in investable assets....'The challenge is that they seem to want to respond' to short-term uncertainty 'by really shortening their time horizons and shifting to assets like cash that are safe,' said Michael Crook, a managing director on the investment strategy team."
11.12.19 - Bankruptcies Surge in U.S. Heartland
Gold last traded at $1,451 an ounce. Silver at $16.67 an ounce.
NEWS SUMMARY: Precious metal prices eased further Tuesday ahead of fresh news on China trade deal. U.S. stocks rose as investors awaited a speech from President Donald Trump on trade and economic policy.
Get ready, gold prices in 2020 will be rock and roll -Hug/Kitco
"From a macroeconomic perspective, several of the longer-term problems that would be bullish for gold will likely manifest in 2020, including a recession and an escalation of the trade wars tensions with China, this according to Peter Hug, global trading director of Kitco Metals. 'From a physical perspective, if you're an investor from a medium to longer term perspective, you just stay with this market and if your holdings are under your percentage allocation that you were looking to apply to your portfolio from the perspective of gold, then you just add to the position at these levels because I think 2020 is going to be a very, very volatile year and I think it's going to be very positive for the metals,' Hug told Kitco News."
When US hawks call China's Communist Party a threat to world peace, it's no longer just rhetoric -South China Morning News
"Given that China-bashing has dominated all US presidential campaigns since the Tiananmen Square crackdown of 1989, it's no surprise that China hawks are in abundance in Washington these days. The Donald Trump presidency has only highlighted this trend. After all, he won the election on a platform promoted by authors like Peter Navarro, who wrote Death by China: Confronting the Dragon, and Michael Pillsbury, who penned The Hundred-year Marathon: China's Secret Strategy to Replace America as the Global Superpower. It would be naive to think the rhetoric ahead of next year's election would be any different....The rhetoric from both sides reveals deep-seated disagreements on fundamental issues, and proves the escalating tensions have gone far beyond the trade war. It also dents optimism that a recent mini-deal between the countries could still avert a catastrophic full-blown trade war....What makes this such a real worry is that the rivalry is about fundamental differences over values, ideology and philosophy of rule. The US hopes China will go along the path to free democracy and find a place in the US-led global order, on the heels of decades of economic advances. But the communist leadership sees freedom and democracy as nothing more than a US plot to overthrow its rule. Since Xi came to office, he has made maintaining the one-party system and his personal absolute grip on power his top priority....As part of Xi's 'Chinese dream' of 'national rejuvenation', Beijing has ramped up efforts to secure its geostrategic flanks to prepare for its ascent into the upper echelons of global power, sending a clear challenge to US dominance."
For Millions Of Americans, It Feels Like An Economic Depression Right Now -Snyder/Economic Collapse Blog
"In America's heartland, bankruptcies are surging, debt burdens are becoming overwhelming, and suicide rates are spiking to unprecedented levels....All across the Midwest, farms are going under at a staggering rate. According to the vice president of the National Farmers Union, the state of Wisconsin is 'losing two farms a day' at this point. If you can believe it, the state of Wisconsin 'lost almost 1,200 dairy farms' between 2016 and 2018. Overall, the number of dairy farms in the state has fallen by 49 percent during the last 15 years....Meanwhile, money is flowing like wine on Wall Street thanks to the Federal Reserve. The unelected Fed has been pumping billions upon billions of dollars into the financial markets, and this has resulted in a higher concentration of wealth among the top one percent than ever before....In essence, Wall Street is being showered by 'welfare money' from the Fed, and nobody is holding the Fed accountable. At the same time, tens of millions of American families are working low paying jobs and are just barely getting by from month to month....Today, half of all American workers make less than $33,000 a year....America's heartland is being gutted, and the 'next recession' hasn't even officially started yet. But soon enough it will, and the deep depression that we are already witnessing in many parts of the middle of the country will get a lot worse."
What Retirement? People Over 65 Are Launching Encore Careers -CNN Money
"A growing number of older Americans are challenging the idea of traditional retirement, as more retirees decide they want to keep working or pursue passions after leaving the rat race behind: the number of Americans age 65 and over who continue to work has doubled since 1985, according to a study by United Income. Some people simply need to keep a paycheck coming in to cover the bills, but many want some combination of rewarding work on their own terms and additional financial security....First, do some soul searching, career experts say. 'Ask yourself, what is it that you do well and enjoy doing, and find meaningful at this point in your life?' says Nancy Collamer, founder of MyLifestyleCareer.com and self-described 'semi-retirement' coach....The network you've built up over your years in the workforce is your most valuable asset, experts says. Reach out to people you've worked with over time and ask them to get lunch or set up informational interviews. LinkedIn is your friend. 'That's how you're going to get a job,' says Chris Farrell, author of 'Purpose and a Paycheck: Finding Meaning, Money, and Happiness in the Second Half of Life' - not by sending out cold applications online....Look into a place like SCORE.org, which connects beginner entrepreneurs with business owners who have already built their own companies. It's a good idea to join a community of other entrepreneurs so you don't feel isolated working from home."
11.11.19 - Recession: China Won't Save Us This Time
Gold last traded at $1,463 an ounce. Silver at $16.77 an ounce
NEWS SUMMARY: Precious metal prices fluctuated Monday on profit-taking amid rising China trade deal uncertainty. U.S. stocks fell as escalating protests in Hong Kong caused investors to take a breather.
Gold rises on trade war doubts, weak stocks after Hong Kong protests turn violent -CNBC
"Gold prices rose early Monday on fresh doubts over whether the United States and China can strike a trade deal, while a sluggish start to the week in equities weighed on risk appetite after protests in Hong Kong turned violent over the weekend....'One reason why gold is higher is because the trade deal is still only speculation, and we are yet to see it. The markets are being a bit cautious here,' said Saxo Bank commodity strategist Ole Hansen. Stock markets dropped on Monday with a fresh escalation of violence in Hong Kong also weighing on prices. Local police fired live rounds at protesters, with cable TV and other Hong Kong media reporting at least one protester being wounded. Video footage showed a protester lying in a pool of blood. 'The turmoil in Hong Kong has not helped market sentiment as it underlined rising geopolitical tensions in the region. Further market corrections are to be expected this week,' said Pierre Veyret, Technical analyst at ActivTrades. U.S. President Donald Trump told reporters on Saturday that Beijing wanted a trade deal more than he did."
Remember Why We Celebrate Veterans Day -Zero Hedge
"101 years ago, a man who started out as a conscientious objector to World War I became that conflict's greatest American hero when he and just a few other soldiers captured 132 German prisoners. Sgt. Alvin York knew why he fought, and it wasn't to make money. When Madison Avenue and Hollywood came looking for endorsements, he refused and said, 'This uniform ain't for sale.' A generation later, when America appeared to be headed toward a second World War, many asked why we should bother, when the so-called 'War to End All Wars' didn't do any such thing. York was there to explain why America must fight once again. 'Liberty and freedom and democracy are so very precious that you do not fight to win them once and then stop,' York said. 'Liberty and freedom and democracy are prizes awarded only to those peoples who fight to win them and then keep fighting eternally to hold them.'....Today, this nation sees its veterans, and honors them - and remains in awe of those who love America so much that they would risk everything to protect it."
The world economy is headed for a recession. China won’t be there to save it this time -Dodwell/South China Morning Post
"A decade after the global financial crisis, with the world's leading economies still addicted to the near-zero interest rates of the emergency response of quantitative easing, it seems the global economy remains on life support, with our experts still flummoxed about how to restore economic health. Trade across the world is stalling. Most leading economies are reporting near-zero economic growth. Investment is in decline. Most expert organizations, including the International Monetary Fund, the UN Department of Economic and Social Affairs, the Organization for Economic Cooperation and Development and the World Trade Organization, are predicting worse to come....After fending off the threat of a massive recession a decade ago, our leaders seem to have retained an unsatiated urge to inflict self-harm as we teeter on the brink of a fresh recession....Spluttering growth in China - aggravated as much by efforts to reform its domestic economy as by the US-China tariff conflict, which is likely to lumber on into 2020 despite talk of a partial deal - is important to the world not just because of China's global importance as a buyer and supplier of goods, but also because of anxieties that it is not well placed today to provide the globally-important stimulus it did after the 2008 crash....If we are on the brink of a new recession, and even China is not on hand to provide fiscal stimulus, then how dangerously ill-equipped are we?"
More Borrowers Are Going Underwater on Car Loans -Wall Street Journal
"John Schricker took out a loan to buy a car in 2017. Then he took out another. And then another...He recently bought a $27,000 Jeep Cherokee with a $45,000 loan from Ally Financial Inc. Consumers, salespeople and lenders are treating cars a lot like houses during the last financial crisis: by piling on debt to such a degree that it often exceeds the car's value. This phenomenon - referred to as negative equity, or being underwater - can leave car owners trapped. Some 33% of people who traded in cars to buy new ones in the first nine months of 2019 had negative equity....The transactions are often encouraged by dealerships, which now make more money on arranging financing than on selling cars....Lenders are typically willing to make the underwater loans, though they often charge high interest rates. Many of the loans are bundled into bonds and snapped up by Wall Street investors."
11.8.19 - Trade Rally Crash Just One Tweet Away
Gold last traded at $1,466 an ounce. Silver at $16.95 an ounce.
NEWS SUMMARY: Precious metal prices steadied Friday on China trade deal uncertainty. U.S. stocks retreated as President Trump threw cold water on recent U.S.-China trade optimism by saying he has not agreed to roll back existing tariffs.
This Trade Rally Is One Tweet Away From a Crash -Bloomberg
"The sense that a trade deal may finally be on the cards sent stocks and crude soaring in the U.S. Thursday...'If there's a phase one trade deal, there are going to be tariff agreements and concessions,' White House economic adviser Larry Kudlow told Bloomberg. 'If China, U.S. reach a phase-one deal, both sides should roll back existing additional tariffs,' China's Ministry of Commerce spokesman Gao Feng said earlier. There’s a laconic warning buried inside both of those statements: 'If.' It's certainly possible that President Trump is tiring of the trade war and as desperate to get an agreement on the table as Beijing seems to think. But the current febrile atmosphere appears to have left the fundamentals of this dispute behind. A single tweet from @realdonaldtrump could be enough to puncture the party mood....China is well aware of the importance of the bilateral trade deficit in Washington, and one of the most promising areas for any agreement is to sharply increase imports of American agricultural and mineral products. Yet China's biggest oil producer, state-owned PetroChina Co., is behaving as if the opposite plan is underway....All this comes before even touching on issues around intellectual property, technology transfer and state involvement in the economy, which were ostensibly the reasons for this trade war in the first place....It's quite as likely that, in the white heat of a breakdown, the levies suspended last month are reinstated, only to be followed by the final round still due to kick in Dec. 15. Should that come about, the current exuberance could turn into a hangover awfully quick."
The New Anti-Capitalism -Project Syndicate
"We are currently living through the most dramatic technological and economic transformation in the history of mankind. We are also witnessing declining support for capitalism around the world. Are these two trends connected, and if so, how?....The current anti-capitalist wave comes at a time when free-market neoliberalism and globalization are nearly universally excoriated. Opposition to neoliberalism came originally from the left, but has been taken up – perhaps even more vigorously and rancorously - by the populist right....The 2008 financial crisis fueled a widespread belief that the system is rigged. While governments and central banks rescued large financial institutions in order to prevent a collapse of the entire global financial system and a repeat of the Great Depression, the millions of people who lost their homes and jobs were left to fend for themselves....The new IT and AI capitalism has a specific geography. It is rooted in the US and China, but the Chinese aim to achieve dominance by 2030. Capitalism has always driven geopolitical change, but now that it is becoming increasingly associated with China - it invites objections from different sources than in the past....The genius of capitalism lies in its ability to produce organic answers to most problems of scarcity and resource allocation. Markets tend naturally to reward the ideas that prove most useful, and to penalize dysfunctional behavior....In today's warming world, there is obviously a need for effective ways to limit greenhouse-gas emissions...the defenders of capitalism need to figure out how to make the system more inclusive, so that it can claim the public's support once again."
Huawei Founder Says Chinese Giant Doesn't Need the U.S. -Wall Street Journal
"Huawei Technologies Co. can survive without the U.S., Chief Executive Ren Zhengfei said, dismissing Washington's campaign against it as ineffective. The Chinese telecom giant hasn't yet received any expressions of interest from U.S. companies to buy the intellectual property underpinning its 5G technology, but the proposal remains on the table, he added. In an interview with The Wall Street Journal, Huawei's 75-year-old founder struck a defiant tone on the Trump administration's recent moves against the company, while also praising the U.S.'s entrepreneurial spirit. 'We can survive very well without the U.S.,' Mr. Ren said. 'The China-U.S. trade talks are not something I’m concerned with.'....The blacklisting was one of numerous anti-Huawei actions in the past year by Washington, which regards it as a security threat...Huawei nonetheless continues to win 5G contracts around the world, while its smartphone sales are booming - particularly in China - despite uncertainty over its continued access to Google's Android operating system....The U.S. defends its actions against Huawei by citing concerns that Beijing could use its equipment for spying. It also says Huawei would be legally bound to comply with requests for customer data from Beijing."
The new dot com bubble is here: it's called online advertising -The Correspondent
"For more than a century, advertising was an art, not a science. Hard data didn't exist....In the early 1990s, the internet sounded the death knell for that era of advertising. Today, we no longer live in the age of Mad Men, but of Math Men. Looking for customers, clicks, conversions? Google and Facebook know where to find them. With unprecedented precision, these data giants will get the right message delivered to the right people at the right time...But is any of it real? What do we really know about the effectiveness of digital advertising? Are advertising platforms any good at manipulating us?....In 2018, more than $273bn dollars was spent on digital ads globally, according to research firm eMarketer. Most of those ads were purchased from two companies: Google ($116bn in 2018) and Facebook ($54.5bn in 2018). An essay by best-selling author Yuval Noah Harari on 'the end of free will' exemplifies the genre: according to the Israeli thinker, it's only a matter of time before big data systems 'understand humans much better than we understand ourselves.'...Facebook knows your soul. Google is hacking your brain....The benchmarks that advertising companies use - intended to measure the number of clicks, sales and downloads that occur after an ad is viewed - are fundamentally misleading....In seven of the 15 Facebook experiments, advertising effects without selection effects were so small as to be statistically indistinguishable from zero. Now we arrive at perhaps the most fundamental question: what, in the end, is there really to know in advertising? Can advertisers ever know exactly what their ad brings in? Google CEO Eric Schmidt told his TV colleague Mel Karmazin that when it comes to online advertising, that question was easy to answer. Lewis went on to work for Schmidt, but research he conducted for Yahoo! in 2011 puts the lie to that claim. The title of his paper: On the near impossibility of measuring the returns to advertising."
11.7.19 - Why Are People Over 55 Going Bankrupt?
Gold last traded at $1,465 an ounce. Silver at $17.06 an ounce.
NEWS SUMMARY: Precious metal prices fell Thursday as China trade deal optimism boosted the buck. U.S. stocks rallied after China said the world's two largest economies had agreed to remove existing trade tariffs.
China Says U.S. Will, and Must, Cut Tariffs to Reach a Trade Deal -New York Times
"The Chinese government on Thursday said Beijing and the Trump administration had agreed to get rid of some tariffs as the two sides work toward ending their 19-month-long trade war. But Beijing also hardened its stance by publicly voicing its insistence that a deal could not take place without each side canceling at least some tariffs....The Trump administration has been considering rolling back a portion of the tariffs but only if China agrees to certain concessions. American officials have so far declined to specify what, if any, portion of the tariffs on $360 billion worth of Chinese goods they might roll back or whether President Trump will abandon plans to impose another tranche, scheduled for December....American officials have emphasized that any moves depend on China taking more aggressive action to protect American intellectual property, and that Mr. Trump will make the final determination....Communist Party officials based outside of Beijing have a history of skepticism toward compromises with the United States on trade....The full elimination of new tariffs is still needed for the complete resolution of the trade dispute, a spokesman for China's Commerce Ministry, Gao Feng said at his weekly news conference in Beijing."
The Power of Gold in Times of Crisis -Zero Hedge
"While physical gold is a well-known safe haven asset which investors flock to in times of market turbulence as a way of protecting their wealth, gold is also the ultimate asset to own and possess in times of crisis and emergency....History is replete with examples of gold being the ultimate asset in times of crisis and desperation, where time and time again, gold comes to the rescue and provides its holders with choice and freedom, choice and freedom that are not available to those who do not hold gold. This is not ancient but recent history, history in our lifetimes and in some cases even events ongoing now....Gold as a safe passage for refugees from Vietnam - Refugees from Vietnam who took huge risks sailing into the unknown to a better life could only do so because they had physical gold to buy safe passage, and because gold is a universal money that can be sold almost anywhere to help finance a new life abroad....South Korea - Gold mobilization to pay external debt - South Korea's population knew instinctively that in the midst of a dark economic crisis, only physical gold could help rescue their economy. And so they collectively mobilized to donate and sell the one true asset that had retained its value in Korea's financial crisis, their gold....Argentina - Accustomed to crisis, accustomed to gold - Beyond providing safe passage and saving a nation, gold comes into its own during periods of hyperinflation, economic stagnation, currency collapses and frozen bank accounts...Argentinians are so used to crises and inflation, so too are they accustomed to holding physical gold, as a way of raising emergency money, and as a way of preserving their accumulated wealth....Venezuela - Gold the 'go to asset' in ongoing chaos - Marked by a collapsing currency, hyperinflation, banknote scarcity, social unrest and shortages of essentials, gold has replaced paper currency across most aspects of Venezuela's economic life as a means of payment, as a form of barter to acquire goods and services, and in some cases literally for day-to-day survival....Zimbabwe - Grams of gold for a loaf of bread - Ravaged by dictatorship, corruption, election fraud, and economic collapse, the failed state of Zimbabwe has come to represent one of the world’s best-known cases of modern hyperinflation in the midst of famine and food shortages...Peak madness was reached in January 2009 with the printing of a Z$100 trillion note, the world's largest currency denomination ever issued....Conclusion - The causes may differ - hyperinflation, death of paper currencies, economic mismanagement, capital controls, wars – but the outcome is always the same. People and economies instinctively turn to the ultimate asset gold as a safe harbor in times of crisis and emergency."
'The Great Reversal' Review: When Bigger Is Not Better -Wall Street Journal
"'The idea that US markets are the most competitive in the world has been widely accepted in economics for several decades,' economist Thomas Philippon writes in 'The Great Reversal.' The thrust of his argument is that this idea is largely a myth. Even before the financial crash of 2007-08, he says, many Americans felt that there was something not right about the economy - that it wasn't performing as advertised....Mr. Philippon, a professor of finance at New York University's Stern School of Business, begins 'The Great Reversal' with a simple observation: 'Why on earth are US cell phone plans so expensive? . . . Why do consumers in Europe or in Asia pay less for cellular service and, on average, get much more?'....Lower wages, lower investment, lower productivity, lower growth, and more inequality are the fruits of economic policies that are geared to protect the biggest corporations and concentrate 'market power' in as few hands as possible....If we could make the economy as competitive as it was 20 years ago, Mr. Philippon concludes, overall GDP would increase by 5%. Even more dramatic would be the effect on wages....'The Great Reversal' argues that the United States has much to gain by reforming how domestic markets work but also much to regain - a vitality that has been lost since the Reagan years."
Why are so many people over 55 going bankrupt? -Marketwatch
"The number of people 55 and older filing bankruptcies has skyrocketed since 1991, and that's even more true for those 65 and older. Bankruptcy can offer a fresh start if you've fallen on tough times and are unable to pay your bills. Once you file bankruptcy, you're no longer responsible for the debts that are discharged. But this fresh start comes with a price: your credit will be negatively affected for years. According to a paper by Robert Lawless, a law professor at the University of Illinois, and three colleagues: The percentage of Americans declaring bankruptcy age 55 to 64 has risen 66% from 1991 to 2016. The percentage declaring bankruptcy age 65 to 74 increased 204% from 1991 to 2016. One major factor behind the rise of these bankruptcies: medical debt. In fact, six out of 10 people 65 and older who file bankruptcy do so because they can't afford to pay their enormous medical bills, Lawless says."
11.6.19 - Morgan Stanley predicts dismal stock returns
Gold last traded at $1,493 an ounce. Silver at $17.59 an ounce.
NEWS SUMMARY: Precious metal prices rose Wednesday on bargain hunting and a flat dollar. U.S. stocks struggled to sustain the recent rally that drove major averages to record highs.
Gold support emerges around $1,480/Oz -FX Street
"After finding decent contention in the $1,480 region, the ounce troy of the precious metal has managed to regain some poise and resumed the upside today. Tuesday's solid improvement in the risk-associated space, in turn sponsored by positive headlines from the US-China trade front, forced the safe haven metal to shed further ground and breach the critical support at the $1,500 mark. The upbeat mood in the riskier assets also lent oxygen to stocks and lifted US yields, all in detriment of the demand for gold. Today's correction lower in the greenback and declining yields are propping up the recovery in the yellow metal following Tuesday's sharp pullback of nearly 2% to the $1,480 region."
Is the Global Dollar in Jeopardy? -Johnson/Project-Syndicate
"Since the end of World War II, the United States dollar has been at the heart of international finance and trade. Over the decades, and despite the many ups and downs of the global economy, the dollar retained its role as the world's favorite reserve asset. For all the associated innovation evident since the launch of the decentralized blockchain-based currency Bitcoin in 2009, the arrival of modern cryptocurrencies has had essentially zero impact on the global taste for dollars...The most powerful central banks (the Fed, the European Central Bank, and a few others) are still running the global money show...Suddenly, however, there is a new, potentially serious player in town: Facebook's Libra initiative...If private money could make it cheaper, easier, and safer to make payments, then consumers would be happy to use it....Of course, Libra has some obvious disadvantages, including Facebook's current reputation for not acting in the public interest....For some time now, there has been speculation that the Chinese renminbi could challenge or even one day displace the US dollar as the world's main reserve currency. Perhaps, but it is not clear that foreign investors will trust the Chinese political system with their rainy-day funds. Still, the Fed is right to be concerned, if not worried....For the first time in a long while, competition is coming to central banks."
Chumps: China Is Playing Trump and His Trade Team -Charles Hugh Smith Blog
"The world's worst negotiating strategy is to give the other side everything they want in exchange for worthless empty promises, yet this is exactly what Trump and his trade team are doing. All the Chinese trade team has to do to get rid of tariffs and other U.S. bargaining chips is mutter some empty phrase about 'agreeing in principle' and the U.S. surrenders all its bargaining chips. If the other side are such naive chumps that they give you everything you want without actually committing to anything remotely consequential, why bother with a formal agreement?....The other guaranteed losing strategy in negotiation is advertise your own fatal weakness, which in Trump's case is his obsession with pushing the U.S. stock market to new highs....Given their success at playing America's team, why do a deal at all? Just play the chumps for another year, and maybe Trump will be gone and a new set of even more naive patsies enter the White House. If we put ourselves in the shoes of the Chinese negotiators, we realize there's no need to sign a deal at all: the Trump team has gone out of its way to make it needless for China to agree to anything remotely enforceable. All the Chinese have to do is issue some stern talk that crushes U.S. stocks and the Trump Team scurries back, desperate to appease so another rumor of a 'trade deal' can be issued to send U.S. stocks higher. It would be pathetic if it wasn't so foolish and consequential."
Morgan Stanley predicts dismal stock returns the next decade -CNBC
"The next decade could be a dismal one for both stocks and bonds, according to Morgan Stanley, which ran analysis on what current valuations for asset classes mean for future returns historically. The traditional investor portfolio - which is made up of 60% stocks and 40% bonds - will return just 4.1% over the next 10 years, Andrew Sheets, chief cross-asset strategist at Morgan Stanley, calculated. That would be close to the 60-40 portfolio's lowest rolling 10-year periods of the past 20 years....Why so low? Such a weak portfolio return is likely after a decade of massive multiple expansion for stocks and a flood of money into bonds as central banks ease monetary policy to re-spark economic growth....Strong returns could be hard to come by as valuations are near historical highs....These high valuations are in part a byproduct of central bank measures to reinvigorate economic growth after the financial crisis. The Federal Reserve cut interest rates to zero and launched three asset-purchasing programs (quantitative easing) after the crisis."
11.4.19 - US National Debt Surpasses $23 Trillion
Gold last traded at $1,511 an ounce. Silver at $18.06 an ounce.
NEWS SUMMARY: Precious metal prices eased back Monday, but remained resilient amid rising investor risk appetite. U.S. stocks rose as investor sentiment was lifted by optimism around a potential U.S.-China trade deal.
What Gold's Massive Rally Tells Us About the Stock Market -CCN
"Last week, the S&P 500 achieved a new all-time high following a positive jobs report. Yet, the gold price has approached levels unseen since 2013....The upside momentum of gold during an extended stock market rally indicates that investors are not fully convinced fundamental issues including geopolitical risks are resolved....The rising gold price suggests that while investors are moving towards riskier investments, they are not disregarding the possibility of a selloff in the markets....Following a 7% increase in price within merely two months since August, Scott Bauer, CEO at Prosper Trading, told Bloomberg that gold bulls have the upper hand in this market. According to Bauer, multiple Fed rate hikes and the gradual unwinding of the U.S. dollar have created an ideal environment for gold to spike...With key markets in Asia like China, Hong Kong, Japan, and South Korea struggling to recover from third-quarter woes, the gold price could sustain its upward trend in spite of the S&P momentum."
Four Reasons Why The "Trade Deal" With China Remains A Farce -Zero Hedge
"The US-China trade deal...is a bum deal. Why do we say that? Without referencing our own work again, consider: 1. US House Speaker Nancy Pelosi has just said Democrats are ready to get tougher on China than Trump by aligning with the EU against it...Trump might actually be the trade dove at this point in time....2. The head of the US Chamber of Commerce in China is quoted as saying of the phase one deal: 'Of course, it's helpful for the farmers and I'm glad to see farmers benefit, but that's not really what we're looking for...For every government policy in China, there's a contradictory policy.'...Indeed, phase one on US-China trade seems an empty box in most respects, and we don't expect there is a phase two to follow....3. China's Shanghai Import Expo is about to get rolling to almost as much fanfare as last year's inaugural event…where actors were allegedly hired to pretend to be buyers. Question: What was Chinese import growth y/y in USD in September 2019? Answer: minus 8.5%... the idea that China is about to be a major new source of global import demand seems science fiction....4. US Commerce Secretary Ross is suggesting sales to Huawei will begin again soon. Yet that overlooks: (1) China is plowing tens of USD billions into its pre-fab industry to make sure US chips aren't needed in the near future."
Federal Reserve rate cut sets up Jerome Powell for bubble blame -Crudele/New York Post
"Hey, Mr. Powell, this bubble is on you! Federal Reserve chairman Jerome Powell and his band of spineless bankers cut interest rates again on Wednesday - the third cut this year. Wall Street was expecting it, so stock prices didn't react much. But low interest rates are what's causing the stock market to bubble and allowing Wall Street to ignore dangerous events happening in this country and around the world that would normally cause it concern. If you are investing in stocks, a bubble is a great thing - until the market regains its senses. When that happens, you are going to want to find scapegoats. Powell will be the lead goat....I think the Fed will be forced to cut rates sooner than next spring because of the political situation in Washington, which could turn very ugly when the results of the investigation by Justice Department Inspector General Michael Horowitz....If everything is going so well, why has the Fed chairman cut rates three times in almost as many months? And why is he expanding the Fed's balance sheet by buying government securities in what appears to be a repeat of quantitative easing - a tactic used to prop up the economy during the Great Recession? Nobody can predict the future, but I’m seeing Chairman Powell being fitted for a goat costume by next Halloween."
US debt surpasses $23 trillion for first time -The Hill
"The federal government's outstanding public debt has surpassed $23 trillion for the first time in history, according to data from the Treasury Department released on Friday. Growing budget deficits have added to the nation's debt at a speedy rate since President Trump took office. The debt has grown some 16 percent since Trump's inauguration, when it stood at $19.9 trillion. It passed $22 trillion for the first time just 10 months ago....'Reaching $23 trillion in debt on Halloween is a scary milestone for our economy and the next generation, but Washington shows no fear,' said Michael A. Peterson, CEO of the fiscally conservative Peter G. Peterson Foundation. 'Piling on debt like this is especially unwise and unnecessary in a strong economy,' he added....While the main drivers of spending are mandatory programs such as Social Security, Medicare and anti-poverty programs, major legislation has grown the deficit considerably since Trump came to office."
11.1.19 - Expect $1,600 Gold in 2020 -World Bank
Gold last traded at $1,511 an ounce. Silver at $18.05 an ounce.
NEWS SUMMARY: Precious metals prices steadied Friday on upbeat data and a weaker dollar. U.S. stocks rose as investor sentiment got a lift from stronger-than-expected U.S. jobs data.
Gold prices to push to $1,600 an ounce in 2020 -World Bank/Kitco
"Investors can expect the rally in gold to continue as uncertainty dominates the marketplace, according to the latest forecast from the World Bank. In a report published Tuesday, the global financial institution said that it expects gold prices to rally 5.6% in 2020, which would see prices trade around $1,600 an ounce. 'The risks to the precious metals price outlook are on the upside and reflect heightened uncertainty and weak growth prospects of the global economy,' the analysts said. The comments come after gold prices rallied 12.6% in the third quarter as prices pushed to a six-year high, seeing best gains in three years....'Prices have been supported by strong physical demand, interest rate cuts by the U.S. Federal Reserve, and increased global policy uncertainty,” the analysts said. “Increased demand for gold has been led by central bank purchases, investor holdings in gold-backed exchange traded funds, and jewelry sales, especially in India.' Gold is expected to outperform in the precious metals space as industrial demand weighs on other metals like silver and platinum, the report said."
The risks are rising that the dollar could lose its special global standing! -CNBC
"Even exorbitant privileges can be lost and there are a number of factors suggesting that, over time, the US dollar may be at risk of surrendering its lead, if not its role, as the world's preeminent reserve currency. Some of these factors relate to U.S. policy decisions, others to policy decisions and developments elsewhere, but all point in the same direction. The primary reasons for the dollar's continued dominance are inertia and the lack of viable alternatives, neither of which U.S. policymakers should find comforting for the longer term....While U.S. policies have clearly pushed some countries, such as Iran and Russia, away from the dollar, officials in China and the euro zone have been actively touting their currencies as reserve and transaction substitutes. The Chinese renminbi was added to the International Monetary Fund's Special Drawing Rights basket in 2016, joining the dollar, euro, yen and British pound, in a development the Fund said 'enhances the attractiveness of the RMB as an international reserve asset.'....IMF data reveal the dollar share of foreign reserves fell from a high of 73% in 2001 to 62% at the end of last year. Similarly, the World Gold Council confirms that central banks bought more gold in 2018 than at any other time since the gold standard ended in 1971, extending a string of large net purchases that began after the global financial crisis. If the trends continue of switching from dollars to other currencies, and from currencies collectively to gold, the dollar's reserve currency status will continue to give ground."
Chinese Bank On Verge Of Collapse After Sudden Bank Run -Zero Hedge
"First it was Baoshang Bank , then it was Bank of Jinzhou, then, two months ago, China's Heng Feng Bank with 1.4 trillion yuan in assets, quietly failed and was just as quietly nationalized. Today, a fourth prominent Chinese bank was on the verge of collapse under the weight of its bad loans, only this time the failure was far less quiet, as depositors of the rural lender swarmed the bank's retail outlets, demanding their money in an angry demonstration of what Beijing is terrified of the most: a bank run. Local business leaders, political cadres and banking executives rallied Thursday at the main branch of Henan Yichuan Rural Commercial Bank, just outside the central Chinese city of Luoyang, where they stood one by one before a microphone to pledge their backing for the bank, as smiling employees brandished wads of cash before television cameras to demonstrate just how much cash, literally, the bank had. It was China's latest, and most desperate attempt yet to project stability and reassure the public that all is well after rumors spread that the bank's chairman was in trouble and the bank was on the brink of insolvency....As we have documented previously, in recent month China's banking sector has been dogged by a sudden surge in liquidity concerns, particularly among smaller regional banks that had expanded aggressively in recent years, and were now suffering a surge in bad loans, threatening their viability....As people continued to show up, adamant about withdrawing their funds; the bank run was accelerating, and nothing officials did could halt, or reverse it...It's those who foolishly believed the government's propaganda that all is well, who will be far, far angrier when they realize that it's gone... it's all gone."
Generations mix to 'change the conversation' about aging -Boston Globe
"It was a reach across the generational divide. A pair of millennial gerontologists and aspiring entrepreneurs invited strangers of varying ages to grab a drink together at a Dorchester craft beer brewery. Their first Intergenerational Happy Hour - part social experiment, part marketing gambit - was one small step toward challenging the age segregation that's become increasingly prevalent in American life, said organizers Natalie Shellito, 29, and Claire Wickersham, 28, both PhD candidates in gerontology at the University of Massachusetts Boston. 'Aging is a team sport,' said Shellito, who recalled growing up close to her grandparents in Wichita, Kan. 'This is a very youth-oriented society, with plastic surgery and Botox and dying your hair and trying to look young. We want to help change the conversation about aging and shape a new culture.'....'I love learning from young people,' said Catherine MacAulay, 72, a retired nurse from West Roxbury. 'Many cultures have older and younger people together all the time.'....Carl Jean 'C.J.' Louis, 24 is a Dorchester resident and community liaison in several Boston neighborhoods...'I think we need to build that bridge between seniors and people who are younger,' he said. 'They took care of us growing up, and we need to take care of them.'"