Swiss America Blog Archive


8.12.19- China Scoops Up More Gold for Reserves

Gold last traded at $1,517 an ounce. Silver at $17.07 an ounce.

NEWS SUMMARY: Precious metals prices rose Monday on geopolitical worry and safe-haven buying. U.S. stocks fell as the intensified Hong Kong protests soured investor sentiment already aggravated by the trade dispute between Washington and Beijing.

Hong Kong Protests Show 'First Signs of Terrorism' -Wall Street Journal
"Chinese authorities condemned violent weekend demonstrations in Hong Kong as 'deranged' acts that marked the emergence of 'the first signs of terrorism' in the semiautonomous city, vowing a merciless crackdown on the perpetrators. The escalating rhetoric from Beijing followed a day of heated protests in Hong Kong, including the hurling of petrol bombs, and came as thousands of protesters gathered at Hong Kong's international airport on Monday, prompting officials to cancel all flights for the rest of the day apart from those already en route to the air-travel hub. 'Radical Hong Kong protesters have repeatedly used extremely dangerous tools to attack police officers,' a spokesman for the Chinese government's Hong Kong and Macau Affairs Office told a news briefing on Monday, according to Chinese state media. 'The first signs of terrorism are starting to appear.' On Sunday, police in riot gear fired tear gas and rubber bullets to disperse crowds of protesters across Hong Kong, some of whom threw bricks and what police identified as Molotov cocktails and smoke bombs....Chinese state media, however, appeared to signal that mainland forces are ready to step in, if necessary."

gold Big Signals From Gold And Silver -Luongo/Zero Hedge
"Gold and silver are back. The global political picture is spinning out of control quickly. And the precious metals are here to tell us just how quickly....Markets hate chaos...And that's why gold and silver put in weeks to remember....Gold is the peoples' hedge against government run amok. At home we have Trump fighting with the Fed. Trump fighting with China, the EU, Venezuela, Iran, Russia while fending off domestic attacks built on a foundation made of equal parts fear, loathing and basic corruption. Every day more people pull back from this show and ask themselves, 'What should I do now?' That's part of where this energy comes from. It's been building for years. And enough people are saying to them the same thing, 'Buy gold.' And, slowly the worm turns....Chaos, once it's unleashed, is impossible to control. When politicians talk and no one listens what do you think happens next?"

China Scoops Up More Gold for Reserves During Trade War -Bloomberg
"There's a powerful constant amid the to-and-fro of the U.S.-China trade war as currency policy gets dragged into the standoff between the world's two top economies: Beijing wants more gold in its reserves. China’s central bank expanded gold reserves again in July, pressing on with a run that stretches back to December...In tonnage terms, the inflow was close to 10 tons, following the addition of about 84 tons in the seven months to June. Gold has rallied in 2019 to a hit a six-year high as global growth stutters, central banks including the Federal Reserve eased policy, and the festering trade war all combined to bolster demand. 'It is important for the country to diversify away from the U.S. dollar,' Philip Klapwijk, managing director at consultant Precious Metals Insights Ltd., said....Central banks continued to load up on gold this year, helping push total bullion demand to a three-year high in the first half, according to the World Gold Council. That trend is expected to continue, with a survey of central banks showing 54% of respondents expect holdings to climb in the next 12 months."

If China Is A 'Currency Manipulator', Then Every Country Is -Tamny/Forbes
"President Trump, Democrats like Sen. Chuck Schumer, along with countless other politicians, economists and pundits, believe that Chinese producers have gained a trade advantage by keeping the value of their currency (the yuan) artificially low. Supposedly this makes them more competitive. So if we ignore that the yuan has actually risen a fair amount against the dollar since 2005, it's easy to see why the accusations against the Chinese don't hold any water. They don't because money is a veil. It can't change the real price of anything....Chinese producers, like all producers, require voluminous imported inputs in order to manufacture the goods they aim to sell. If the Chinese are devaluing, any presumed competitive advantage gained by them is eroded by increased production costs....Not only is it naively asserted by the uninformed that the Chinese keep the value of the yuan artificially low, it's also said that they 'manipulate' their currency. In truth, China does what just about every country in the world does: it strives to maintain a tight relationship between the yuan and the dollar. The why behind the above is simple: the dollar is the world's currency....When the U.S. devalues the dollar, the tight relationship between the world's currencies and the dollar means that a devaluation stateside is generally a global event. Applied to President Trump, presidents mostly get the dollar they want, and Trump has been busy of late communicating to the markets his desire for a weaker dollar. This has revealed itself through a soaring gold price. Unsettling about all this is that it could get worse. Talking to reporters recently about further devaluation, Trump made plain that 'I could do that in two seconds if I wanted to.' Ok, but a weak dollar is tantamount to a weakening of currencies around the world....With his talking down of the dollar President Trump is introducing corrupted, faked returns and contracts into the world that producers can't fully protect themselves from, and the markets are responding. Devalued money is bad for investors, which means it's bad for growth. Someone should alert Trump to this."

RealMoneyBlog - Free daily/weekly email


8.9.19 - Investors Rushing To Gold

Gold last traded at $1,508 an ounce. Silver at $16.93 an ounce.

NEWS SUMMARY: Precious metal prices rose Friday on safe-haven buying and a weaker dollar. U.S. stocks traded lower amid renewed trade war fears as Wall Street concluded a wild week of losses.

Investors Rushing to Gold And Bonds As Stock Market Continue Tumbling -Newsweek
"Investors are turning to gold and bonds as stock markets continue tumbling amid increased trade tension between the United States and China. Trump's threat last week to impose tariffs on $300 billion more Chinese imports sparked investor fears. Beijing's decision to let its currency fall below the symbolic ratio of seven yuan to one dollar, which the U.S. responded to by labeling China a currency manipulator, has further sparked fears about the escalating trade war. After stocks registered their worst week of year and the Dow Jones Industrial Average suffered its sixth-largest point drop in history on Monday, investors are spooked and looking for a safe investment haven. As the stock market has slid, the value of gold has risen sharply. Spot gold is now priced above $1,500 per ounce, up from about $1,440 per ounce last Thursday. Goldman Sachs predicted that the price of gold, a more stable but less profitable investment than stocks, could rise to $1,600 per ounce. The price of spot silver is also rising and reached a 13-month high of $17.01 per ounce."

sinking stocks Loose Money, Big Deficits, and the Iceberg Ahead -Spectator
"Donald Trump accuses China of currency manipulation as he pressures the Federal Reserve to do the same thing. If you can't beat 'em, join 'em. 'Our problem is not China,' the president tweeted on Wednesday. 'We are stronger than ever, money is pouring into the U.S. while China is losing companies by the thousands to other countries, and their currency is under siege - Our problem is a Federal Reserve that is too proud to admit their mistake of acting too fast and tightening too much (and that I was right!). They must Cut Rates bigger and faster, and stop their ridiculous quantitative tightening NOW.'....The Fed, which just lowered interest rates, does not partake in quantitative tightening and has not done so for some time. It likely lowers rates further as the year progresses. Trump knows this, and the market expects this. So why continue carping on the Fed when it did, and likely continues to do, what you wish it to do (just not at the degree you wish it to)? Donald Trump faces a tight reelection bid next year....To squeeze whatever juice remains from the few undecideds who decide the race, the president requires the economy to move full speed ahead....An economy that booms does not require loose money and massive deficit spending. The fact that voices more extreme than the president's on this matter call for another round of quantitative easing, the Fed gobbling up securities to prop up the economy, makes this economic silly season even more farcical. Gross domestic product continues to grow at a healthy clip, the unemployment rate remains below 4 percent, and the Dow, despite its rough week, registers about 8,000 points higher than it did on Election Day 2016. Yet paranoia encourages all manner of gimmicks to boost an economy not in the doldrums....It makes some sense to borrow, loosen the money supply, and perhaps engage in quantitative easing when recessions, particularly those along the lines of 2008 or 1929, hit. Doing all this during periods of prosperity not only makes no sense, but also makes it more difficult to rely on such remedies once the economy really needs it. We may not control whether an iceberg lies ahead. We can restrain ourselves from placing it there."

Recession odds rise as economists cut growth estimates- MSN/Bloomberg
"The likelihood of a U.S. recession in the next 12 months rose to 35% in an August survey of economists, from 31% forecast previously, as global trade tensions fuel economic uncertainty. Growth in the world's biggest economy will average 2.3% this year, down from 2.5% seen in a July survey. Gross domestic product expansion is forecast to slow to a 1.8% annualized pace in the third quarter, from 3.1% in the first three months of the year and 2.1% in the second quarter. 'Trade tensions are needlessly roiling financial markets, which could eventually destabilize a stable economy,' Parul Jain, chief investment strategist at Macrofin Analytics LLC in Wayne, New Jersey, said in comments attached to her survey response....Economists moved up expectations for the next Fed interest-rate cut to September from December and now see a 25-basis-point reduction in the benchmark rate, to a range of 1.75% to 2%, at the next meeting, according to the poll. Global growth forecasts for 2019 were also cut, to 3.2% from 3.3%. Bloomberg's survey was conducted Aug. 2 to Aug. 7."

Now The Dollar Is Everyone's Problem -Zero Hedge
"Investing is hard enough that there isn't much room for unforced errors, yet many investors allow themselves to get distracted and miss important things. For long-term investors this mistake often manifests itself by getting caught up in day-to-day news stories and losing perspective on key structural factors. One such key factor is the global monetary system....Asset purchases by major central banks are especially powerful in boosting liquidity because they create base money from which even more money may be created through bank lending and other activities. As a result, asset purchases have a multiplier effect and can therefore be powerful tools for avoiding existential market risks due to lack of liquidity....Financial channels are driven by the US dollar as Martin Wolf points out in the FT, 'One traditional issue is the reliance on the US dollar in the global monetary system.' When dollars are easily available bubbles form, but when dollar liquidity dries up so too does associated economic activity. Wolf forecasts a continuation of negative trends....As a result, factors affecting dollar liquidity can pop up in lots of places. This presents a very different situation than in the early 1970s when Treasury Secretary John Connally famously (and arrogantly) told complaining European finance ministers, 'The dollar is our currency, but your problem.' Today, US dollar still reigns supreme relative to other fiat currencies (and therefor crucial for funding growth), but the US economy is a smaller part of the global total. At the same time, the Fed has considerably less control over US dollar liquidity which feeds back into lower global growth when it contracts. Now the dollar is everybody's problem."

RealMoneyBlog - Free daily/weekly email


8.8.19 - Gold Outperforms Stocks in 2019

Gold last traded at $1,518 an ounce. Silver at $17.06 an ounce.

NEWS SUMMARY: Precious metal prices hovered near 6-year highs Thursday amid market uncertainty. U.S. stocks rose as global bond yields rebounded while investors digested better-than-expected trade data out of China.

Gold surges above $1,500, now has a better return than stocks this year -CNBC
"Gold rose to its highest level in more than six years on Wednesday as concerns about the global economy made the precious metal and other traditional safe havens more attractive than riskier assets like stocks...Wednesday marked the first time since April 2013 that gold traded above $1,500. The gains brought the metal's gains to more than 18%. That return is higher than the S&P 500's 14.3% year-to-date gain....Investors turned to gold at a time when the amount of debt trading at negative yield increases. Currently, there is $15 trillion worth of bonds with negative rates. This makes gold more attractive since it retains its value even in times of slower economic growth. Concerns over the global economy come as the U.S.-China trade war intensified with Chinese authorities allowing the country's currency, the yuan, to depreciate against the dollar while several central banks around the world cut interest rates....Jeffrey Gundlach, CEO of Doubleline Capital, sees further gains for the precious metal moving forward as yields keep falling. 'At this point, I think the way to think about it is, as long as the volume of negative interest rate bonds outstanding increases, it's quite likely that gold moves higher in a similar vein,' Gundlach told Yahoo Finance."

buy gold Buy More Gold Now, Societe Generale Says -Barrons
"The price of gold hit its highest point since May 2013, and it could keep rallying...Societe Generale's Alain Bokobza reiterated a bullish view on gold in a note on Tuesday, writing that three major factors could sustain a 'gold fever.' 1. The current stage of the economic cycle - Societe Generale's asset-mapping framework is currently signaling a higher allocation into gold, according to Bokobza....2. Safe-haven assets are scarce - Bokobza believes the U.S. is nearing an economic slowdown or an outright recession, which would make portfolio protection a prudent move....3. Central bank purchases - Central banks, which are seeking diversification away from the dollar, are building gold reserves that could 'sustain steady growth for a prolonged period,' Bokobza noted....The growing threat of a currency war in recent days could add to this momentum and prove an overall tailwind for gold."

What the U.S. Government Isn't Telling You About the Trade War With China -Bonner/Bonner And Partners
"The whole ball of trade wars, Federal Reserve rate cuts, currency manipulation, inverted yield curves, and negative yields is so tangled up in deception and claptrap it is almost impossible to unravel....China is a key player in the whole worldwide bamboozle, wringing fake money out of debt-drenched consumers in Europe and America and spinning it into stocks, bonds… cement, steel… and even more factories and empty towns. Bringing China to its knees may be good for tweet-o-rama politics. It might even be doing the Chinese a favor… But it would be very bad for a world economy with $250 trillion of debt. It's Inflate or Die. And the China trade is a key part of the inflation program. Both the U.S. and Chinese economies are built on debt. The U.S. creates fake money and lends it out; Americans spend it on Chinese-made goods; the Chinese economy, thus stimulated, builds more factories and produces more goods, further undermining U.S. manufacturing industries. When China goes down, most likely, the U.S. and Europe will too....This 'manipulation' charge is a good illustration for the whole fandango. Everything is manipulated, up is down, tomorrow is yesterday. Nothing is true. Nothing is straight. Nothing is what it pretends to be. How do you untangle this mess? What's real? What's going on?....If we're right, real capital - gold - will become more valuable. Anti-capital - debt and wealth-destroying companies - will fall in value. And the Greed/Fear index will continue down until it finally completes its historic rendezvous with destiny. Then, you will once again be able to buy the entire Dow for five ounces of gold… or less."

Shooting stars -Ponte/WND
"A madman pens a manifesto, travels to El Paso, with a rifle murders at least 20 and wounds many others at a shopping mall, then surrenders, apparently intending to become a famous martyr, a shooting star. Will we let this madman - and the politicians eager to exploit what he did - kill America's future as a free nation? History sometimes turns on singular events. We need a careful, prayerful national perspective on which events should change history....This coming Saturday, Aug. 10, the wheels in the sky are bringing us other wonders and woes to contemplate. This weekend will bring Mother Nature's own Fourth of July fireworks, at least one shooting star per minute lighting the heavens in the annual Perseid meteor showers. The calendar is a map charting where our planet is in its annual orbit around the Sun. Aug. 10 is a place in space that Earth visits every year during that journey that defines a year....The typical Perseid shooting star is actually the size of a grain of sand and the density of cigarette ash. But it can hit our upper atmosphere traveling at 133,200 miles per hour, instantly heating from the friction of rubbing against gas molecules. At 90 miles above our heads, the shooting star starts to incandesce. A heartbeat later, around 60 miles up, it burns out as a cinder. And these shooting stars will appear to have their 'radiant,' their origin, in the northeast sky near the constellation Perseus, hence the meteor shower's name Perseids. Enjoy not only the science but also the wonder of the Perseids. Ancient peoples made a wish or prayer whenever they saw a shooting star. They believed that the heavens were behind an invisible window in which a door momentarily opened to let a shooting star messenger come to Earth; a quick wish or prayer, they believed, could enter into heaven before that door closed."

RealMoneyBlog - Free daily/weekly email


8.7.19 - Gold Prices Top $1,500 -Wall St. Journal

Gold last traded at $1,519 an ounce. Silver at $17.19 an ounce.

NEWS SUMMARY: Precious metal prices lurched to fresh 6-year highs on safe-haven buying. U.S. stocks fell sharply, adding to the month's steep losses, as a drop in global bond yields raised concerns about a slowing global economy.

Gold Tops $1,500 -Wall Street Journal
"Gold prices topped $1,500 a troy ounce for the first time in six years, driven higher by a drop in bond yields and investors’ flight from global stocks...Prices traded as high as $1,522.70 a troy ounce earlier in the session. Stoking the gains are renewed concerns that an intensified trade war between the U.S. and China will hurt already fragile global growth. Recent economic data has further fueled those fears - German industrial production figures for June, reported Wednesday, were much weaker than analysts expected, a sign that Europe's largest economy continues to struggle. U.S. stocks were down sharply in recent trading, with the S&P 500 falling around 0.8%. Government bond yields around the world slid further on Wednesday after interest-rate cuts by three central banks exacerbated investors' fears of slowing growth around the world, with the yield on 10-year Treasurys breaking below 1.6% earlier in the session....A popular destination for nervous investors, gold tends to attract buying during times of economic or political uncertainty. Prices are up more than 18% this year....'The collective mood is one where the trade war has taken on a different life,' said Ira Epstein, a strategist with Linn & Associates. 'There’s a lot of fear out there.'"

gold 'Quantitative Failure' Gives Gold A Chance At $2,000, Says BofAML -Kitco
"Gold's rally has room to run with Bank of America Merrill Lynch (BofAML) projecting that the yellow metal hits $1,500 an ounce next year with the potential to get as high as $2,000....'We see scope for gold to rise towards $2,000/oz,' BofAML said in a report published on Friday. A big supporter of gold prices going forward will be the effects of 'quantitative failure,' the bank pointed out. 'Successive rounds of monetary easing have had a series of side effects...This has been a key driver behind the recent gold rally and with more easing to come, the dynamic will likely sustain a bid for the yellow metal,' BofAML wrote....Central banks will also continue to support gold with more buying as many now prefer to diversify their reserves to hold more gold, BofAML pointed out. 'The motivation behind the respective reserve strategies varies, with the historical positioning, the long-term store of value, gold's role as an effective portfolio diversifier and lack of default risk...De-dollarization features as well as a motivation,' the report noted."

When You Get An Email Like This From The Fed, It May Be Time To Panic -Zero Hedge
"Yesterday, in a lengthy article referencing the ongoing dollar and funding liquidity collapse as a result of the aggressive rebuild of the Treasury's cash balance from $133BN to $350BN in the aftermath of the debt ceiling deal, we said "Forget China, The Fed Has A Much Bigger Problem On Its Hands." As we explained in detail, the main reason why the Fed should be concerned, is that according to a research report from BofA's Marc Cabana which we used extensively in the report, the Fed may be forced to launch Quantitative Easing as soon as Q4 to provide the market with the much needed liquidity, or else suffer the consequences of a major liquidity shortage. To wit, in describing the various steps the Fed can engage in, this is what the BofA strategist said: 'Outright QE: after OMO dealer capacity is exhausted the Fed may need to start permanently expanding its balance sheet. The Fed would likely describe this as offsetting bank reserve demand and growth in other non-reserve liabilities'. Well, it appears that the Fed paid attention, because moments ago we received an email from a Federal Reserve researcher which should make everyone very, very nervous. Specifically, the 'rather urgent request' from a Fed staffer seeks the full Cabana report whose gist is that the Fed will have to launch QE4 in very short notice to offset the upcoming liquidity drain. Based on the Fed's email, we wonder if it means the Fed is now seriously contemplating following through on Cabana's recommendation, and if so, does the market crash first, or is it about to price in QE4 and soar. We expect to find out very soon."

Is an aging population actually bad for the economy? -The Week
"Birth rates have been falling for decades, not only in America but around the world, which now means the amount of older people is growing in proportion to many nations' working-age populations. Pretty much everyone on both sides of the aisle assumes that's bad for national economies. Conservatives rely on this assumption to argue for higher birth rates, liberals rely on it to argue for more immigration. But what if the assumption is wrong? It turns out the evidence that aging populations harm economic growth is far from conclusive...In 2017, the economists Daron Acemoglu and Pascual Restrepo looked at how rapidly GDP per capita grew between 1995 and 2015 in a whole bunch of countries and compared it to how much the ratio of old people to working-age people changed over the same period. Contrary to the prevalent assumption, they found basically no relationship at all. Another recent study out of Australia looked at rates of population growth across countries. The nations with slower population growth - up to and including negative population growth - actually saw faster growth for both GDP per capita and worker productivity. The mainstream assumption seems to be largely driven by the example of Japan...but Japan is at the extreme end of the overall global pattern. Within American specifically, there's also a historical problem with this story. It turns out that our dependency ratio - the number of non-working age persons relative to working age persons - was higher in the 1950s and 1960s than it is today. The reason was children...made up for the smaller proportion of old people....The theory that more old people means more saving relative to investment opportunities also makes a hash of how the economy really works....At any rate, while there is evidence out there that older populations are a problem for economic growth, it's hardly dispositive. There's plenty of reason to doubt it, and plenty of evidence in the opposite direction."

RealMoneyBlog - Free daily/weekly email


8.6.19 - Ditch the Dollar, Buy Gold -JP Morgan

Gold last traded at $1,484 an ounce. Silver at $16.44 an ounce.

NEWS SUMMARY: Precious metal prices rose to fresh 6-year highs on safe-haven buying. U.S. stocks struggled to rebound from their worst day of the year as trade tensions continue to dampen market sentiment.

Ditch the Dollar, Buy Gold and Other Currencies: JP Morgan -Kitco
"Investors should diversify away from the U.S. dollar and increase their exposure to other major currencies and gold, according to a report from JP Morgan. In a recent market note, the bank stated that it sees the U.S. dollar losing its status as the world's dominant currency, and consequently depreciating in value. 'There is nothing to suggest the dollar dominance should remain in perpetuity,' the note said. 'In fact, the dominant international currency has changed many times throughout history going back thousands of years as the world’s economic center has shifted.'....'Of the estimated $30 trillion in middle-class consumption growth between 2015 and 2030, only $1 trillion is expected to come from today’s Western economies,' Cohen said....'In currency space, this means the USD will likely lose value compared to a basket of other currencies, including precious commodities like gold.' Recent data on currency reserve holdings revealed that central banks were increasingly diversifying away from the U.S. dollar, increasing their gold reserves at a record pace while also selling their dollars and buying euros, Cohen pointed out."

china gold Trade War Becomes Currency War -Wall Street Journal
"President Trump claims trade wars are easy to win, but that boast looks worse than ever amid the financial carnage from his latest threat of tariffs on Chinese goods. His trade war has now become a currency war, which raises the potential economic harm to another level. That was the ugly message Monday in financial markets, which sold off world-wide after China devalued the yuan following Mr. Trump's threat of 10% tariffs on $300 billion in Chinese goods. Emerging-market currencies plunged, equity markets dropped 3% or so on the day, gold and the U.S. dollar soared as safe havens, and the 10-year Treasury yield fell to a stunningly low 1.74%. The washout followed China's decision Monday to set its yuan-dollar peg below 7 to 1, its lowest level since 2008. Mr. Trump tweeted that this is 'currency manipulation,' but what did he expect? Late Monday the U.S. Treasury escalated the clash by officially calling China a currency manipulator, which could trigger more tariffs. But Beijing has an incentive to prevent any further devaluation to prevent capital flight....Where this currency convulsion ends is anyone's guess. One of Mr. Trump's trade conceits is that he can manipulate markets at will by dialing tariffs up or down. But currency markets have a tendency to overshoot and create unexpected casualties. Markets don't know how much financial strain a company in Shenzhen can bear before it defaults on its dollar bonds, and Mr. Trump doesn’t know either."

A second market sell-off could be 'Lehman-like' -Nomura/CNBC
"Investors shouldn't take much solace from Tuesday morning's slight rebound, says Nomura. They are warning the next sell-off could resemble a crisis-level plunge like the one that followed Lehman Brothers' collapse. This view is much more catastrophic than the rest of Wall Street with most firms predicting a stock market correction (down 10%) at most and likely just a slight pullback. Nomura is basing its view on data showing hedge funds fleeing the market and said more are set to exit when their algorithms are triggered by rising volatility....'At this point, we think it would be a mistake to dismiss the possibility of a Lehman-like shock as a mere tail risk,' Nomura macro and quant strategist Masanari Takada said in a note on Tuesday. 'The pattern in US stock market sentiment has come to even more closely resemble the picture of sentiment on the eve of the 2008 Lehman Brothers collapse that marked the onset of the global financial crisis.' The market plunge could arrive as soon as late August, Nomura predicted, as trend-following algo traders still have many bullish trades to unwind. 'We would expect any near-term rally to be no more than a head fake, and think that any such rally would be best treated as an opportunity to sell in preparation for the second wave of volatility that we expect will arrive in late August or early September,' Takada said. 'We would add here that the second wave may well hit harder than the first, like an aftershock that eclipses the initial earthquake.'"

The Ideology of Hate and How to Fight It -Brooks/New York Times
"Many of today's mass murderers write manifestoes. They are not killing only because they've been psychologically damaged by trauma. They're not killing only because they are pathetically lonely and deeply pessimistic about their own lives. They are inspired to kill by a shared ideology, an ideology that they hope to spread through a wave of terror....The struggle between pluralism and antipluralism is one of the great death struggles of our time, and it is being fought on every front. We pluralists do not believe that human beings can be reduced to a single racial label. Each person is a symphony of identities. Our lives are rich because each of us contains multitudes. Pluralists believe in integration, not separation. We treasure precisely the integration that sends the antipluralists into panic fits. A half century ago, few marriages crossed a color line. Now, 17 percent of American marriages are interracial....Pluralism is not just having diverse people coexist in one place. It's going out and getting into each other's lives. It's a constant dialogue that has no end because there is no single answer to how we should live. Life in a pluralistic society is an ever-moving spiral. There are the enemies of pluralism ripping it apart and the weavers of community binding it together...Pluralism is about movement, interdependence and life. The struggle ahead is about competing values as much as it is about controlling guns and healing damaged psyches."

RealMoneyBlog - Free daily/weekly email


8.5.19 - Global Markets in Panic Mode, Gold Rises

Gold last traded at $1,477 an ounce. Silver at $16.44 an ounce.

NEWS SUMMARY: Precious metal prices rose Monday on safe-haven buying and a weakening dollar. U.S. stocks plummeted as a trade war with China intensified with new sanctions and devaluation of the Yuan.

Stocks Slide as Trade Battle Intensifies -Wall Street Journal
"Stocks were pummeled by selling Monday, pushing indexes from New York to Shanghai lower, as the yuan reeled and fresh trade threats between Beijing and Washington raised fears of an economic slowdown. Stocks elsewhere retreated, with benchmark indexes in Europe, Japan and Hong Kong falling at least 1% apiece. The latest wave of selling started, investors and analysts said, after reports showed Chinese and U.S. officials ratcheting up pressure on each other in their prolonged trade fight....'Global stocks had been priced for perfection,' said Kenny Polcari, managing principal at Butcher Joseph Asset Management. 'Now people are realizing we may not get a deal.' Monday’s selling appeared to heighten traders’ bets on the Fed lowering interest rates multiple times by the end of the year."

gold teeth Global markets are in panic mode - sparking a wave of investment into gold, bonds and currencies -CNBC
"Global growth worries and an intensifying trade war between the world’s two largest economies sparked a stampede into perceived 'safe-haven' assets on Monday. Gold prices jumped more than 1% to hit their highest level in over six years on Monday, while the Japanese yen and core government bonds also rallied. It comes at a time of heightened volatility in financial markets, with the pan-European Stoxx 600 falling almost 2%. That's on top of the 2.5% it lost on Friday - its worst day so far in 2019. The CBOE volatility index - known commonly as the VIX or Wall Street's 'fear gauge' - climbed to its highest level since mid-May, while Europe's equivalent reached its highest since early January. At times of market turbulence, investors tend to flee to assets expected to either retain or increase in value - such as gold...Safe-haven assets are typically sought to limit one’s exposure to losses in the event of a sharp market downturn."

Currency War Begins: Chinese Yuan Crashes Past 7 To New Record Low -Zero Hedge
"China is firing all the big guns because just an hour after Beijing effectively devalued the yuan, when it launched the latest currency war with the US, Bloomberg reported that the Chinese government has asked its state-owned enterprises 'to suspend imports of U.S. agricultural products after President Donald Trump ratcheted up trade tensions with the Asian nation last week.' China's state-run agricultural firms have now stopped buying American farm goods, and are waiting to see how trade talks progress. Translation: trade talks, even the fake kind, is now over, dead and buried, and the only question is how Trump will react... and sure enough, just a few hours alter in a dramatically unsettling move for global stability, China's offshore yuan just collapsed below 7/USD - after the PBOC fixed the onshore yuan below 6.90 for the first time in 2019 - the currency plunging a stunning 12 handles to its weakest on record against the dollar as countless stop losses were triggered and thousands of traders were margined out....China's central bank has confirmed...saying that it is able to keep the yuan exchange rate at a reasonable and balanced level - whatever that means - while acknowledging that the Yuan plunging beyond 7 per dollar is due to market supply and demand, trade protectionism and expectations on additional tariffs on Chinese goods. The carnage from yuan volatility is starting to spread... Chinese bond yields are tumbling."

The superrich are selling stocks, buying properties and keeping cash ready -Marketwatch
"The superrich blueprint to navigating this hairy stock market: Tap the brakes and get ready to pounce when it all goes to hell. And by the looks of Monday's action, hell might not be too far away. In the first quarter, Tiger 21, a coalition of 750 members worth in excess of $75 billion, raised cash to levels not seen since 2013....These deep-pocketed investors are continuing to move away from equities and build up their positions in real estate. As Tiger 21 President Michael Sonnenfeldt previously told MarketWatch, the stock market is 'priced to perfection' and rising economic inequality leading to greater polarization in America and elsewhere.'"

RealMoneyBlog - Free daily/weekly email


8.2.19 - Middle Class Dives Deeper in Debt

Gold last traded at $1,457 an ounce. Silver at $16.24 an ounce.

NEWS SUMMARY: Precious metal prices rose this week on safe-haven buying and a weaker dollar. U.S. stocks fell as President Trump stoked U.S.-China trade fears with the announcement of more tariffs while investors digested U.S. employment data.

Gold's Mission: Revisit Resistance At $1,700 An Ounce -Bloomberg Intelligence/Kitco
"The gold market is set up to continue its bull run after a pause, according to Bloomberg Intelligence (BI). 'Gold's advance appears to have among the strongest foundations,' BI senior commodity strategist Mike McGlone said in the latest commodity outlook. 'Gold prices should continue to advance. Fed easing is a tailwind.' The gold bull run is projected to continue this year as gold's mission is to revisit its resistance at $1,700 an ounce, last seen in 2013, McGlone highlighted. 'A potential increase in hedge fund positions supports our view that gold's initial mission is revisiting resistance near 2013's peak at $1,700 an ounce,' he said. 'Hedge funds' net-long futures positions are a bit extended, but indicate that gold is in the early days of a bull market.' The only headwinds strong enough to hold gold back from the $1,700 an ounce level is a higher U.S. dollar and weaker equity volatility, warned McGlone. 'The extent to which Fed easing can reverse the appreciation of the dollar should be the primary factor behind gold's showing vs. U.S equities,' he wrote."

taxing Adding More Tariffs on Chinese Goods Seems Like a Great Way to Torpedo the Economy -Slate
"On Thursday, Donald Trump announced that starting in September he would impose a new 10 percent tariff on goods from China, after trade talks with the People's Republic apparently failed to make progress. He announced the tariff in a series of tweets... The new border taxes will apply to the $300 billion worth of Chinese goods that, until now, had not faced a tariff. Another $250 billion will continue to be tariffed at a 25 percent rate. This move comes at a sort of odd time. The U.S. economy has been looking fragile lately - bond markets are screeching in panic, GDP has slowed a bit, and business investment is drying up. Just about everybody agrees that the trade war is contributing at least somewhat to the uneasiness, though it's hard to say precisely how much. When the Federal Reserve cut interest rates on Wednesday, Chairman Jerome Powell emphasized that the central bank was doing it in part to make sure that the trade war didn't accidentally capsize the economy. (Or, as he put it, the move was meant to 'ensure against downside risks to the outlook from weak global growth and trade tensions.' Gotta love Fed speak.)....It will almost certainly be bad for the overall health of the economy, if only marginally so. So, what's going on? One possibility is that Trump simply isn't worried about the effect that his tit-for-tat with China is having on the economy and just wants to keep fighting it to the bitter end...But it's also possible that this move is partly meant to scare the Fed into taking more action than it did Wednesday. Many investors (as well the president) were hoping that Powell would signal that the Fed intended to pursue an aggressive series of rate cuts. Instead, the chairman hinted that the central bank might only cut rates further if the outlook for the economy got worse and said that 'trade tensions' were one of the important factors that policymakers would monitor....When the Fed cuts, it tends to push down the value of the dollar, which makes Chinese imports more expensive to Americans and U.S. exports more affordable to the world. If increasing tariffs leads the Fed to cut rates and devalue the dollar as a result, it's basically a two-for-one strike against Beijing."

Families Go Deep in Debt to Stay in the Middle Class -Wall Street Journal
"The American middle class is falling deeper into debt to maintain a middle-class lifestyle. Cars, college, houses and medical care have become steadily more costly, but incomes have been largely stagnant for two decades, despite a recent uptick. Filling the gap between earning and spending is an explosion of finance into nearly every corner of the consumer economy. Consumer debt, not counting mortgages, has climbed to $4 trillion - higher than it has ever been even after adjusting for inflation. Mortgage debt slid after the financial crisis a decade ago but is rebounding. Student debt totaled about $1.5 trillion last year, exceeding all other forms of consumer debt except mortgages. Auto debt is up nearly 40% adjusting for inflation in the last decade to $1.3 trillion. And the average loan for new cars is up an inflation-adjusted 11% in a decade, to $32,187....The debt pile is also an accumulated ledger of economic risk. It should be manageable so long as unemployment remains low. If job losses begin to rise, it would become unsustainable for some share of borrowers, raising chances of an increase in missed payments and lenders writing off unpaid balances....In case of a broad economic downturn, people's debt levels could weigh on the economy for an extended period, because people who carry a lot of debt into a downturn tend to rein in their spending for years afterward."

Is it time to take Marianne Williamson seriously? -Yahoo News
"The first night of CNN's two-part Democratic presidential debate series featured strong moments from top contenders like Bernie Sanders and Elizabeth Warren, but it was an unlikely candidate who drew the loudest support from the audience. Marianne Williamson spoke just nine minutes during the two-hour-plus debate, but may have left a lasting mark with her impassioned statements on race and the purpose of government. The famed self-help writer has up until now been known as a wellness advocate who keeps company with celebrities like Oprah, Cher and Kim Kardashian. But on Tuesday, she turned heads with reasoned arguments on reparations for the descendants of slavery and the causes of the Flint, Mich., water crisis, while invoking New Age-y concepts like the 'dark psychic force' of racism. She was the most-searched candidate during the debate, according to Google Trends, despite regularly polling at - or below - 1 percent. Before the Tuesday event, Williamson's campaign had been seen by many as a fun but ultimately frivolous oddity of the 2020 primary cycle. Statements like her plan to 'harness love for political purposes' led to significant online reaction, the tone of which varied somewhere between admiration and mockery....Williamson's chances of actually contending for the Democratic nomination are still quite small. She'll have to improve her polling numbers and donor base just to make the stage for the next debate in September. She reportedly hasn't said whether she'd stay in the race if she failed to reach the debate or if she intends to run for office in the future."

RealMoneyBlog - Free daily/weekly email


8.1.19 - 2019: Will Silver Outperform Gold?

Gold last traded at $1,451 an ounce. Silver at $16.35 an ounce.

NEWS SUMMARY: Precious metals rose Thursday on bargain-hunting and a flat dollar. U.S. stocks rose as investors increased bets on the Federal Reserve cutting rates for a second time later this year.

Why Silver Will Be a Better Bet Than Gold if the Precious Metals Rally Continues -TheStreet
"Anyone bullish on precious metals should consider silver...The white metal tends to see far more volatility, which is an advantage for traders in an up-trending market. Plus, silver prices are still playing catch-up with gold based on historical price analysis...In a bull market, volatility is okay as long as it is upward trending volatility, which is exactly what we see right now in the precious metals market. In such a case, savvy traders should take a more volatile route....Silver tends to outperform gold when the market is moving up, just like small caps frequently outperform large caps in an equity bull market....Silver production is overwhelmingly the result of miners pursuing other minerals such as gold and copper. In 2018, 74% of silver production was the result of this so-called secondary production, according to the Silver Institute....Silver prices are also low now when compared to gold using something known as the gold-silver price ratio. Currently one ounce of gold trades for 87 times the value of one ounce of silver. Historically, that ratio has been in the range of 40 to 80, says Matthew Miller, a mining analyst at New York-based research firm CFRA. Or in other words, gold is now trading at a premium valuation to silver based on history."

silver report Will Silver Outperform Gold? -Swiss America Report
In July 2019, silver prices rose above $16.00/oz. as the historic Gold-to-Silver Ratio peaked at 93-to-1. Since then, the ratio has rapidly fallen back to the mid-80s. We feel strongly that the ratio could continue dropping toward a more normal range near 60-to-1, or lower - which could push silver prices up as much as 25%-50% to $20-$25/oz. - regardless of whether gold prices rise or not! Right now the Gold-to Silver ratio may present an excellent opportunity to convert a portion of your physical gold or Precious Metal IRA gold holdings into physical silver to maximize growth potential. Discover the simple "Ratio Trading" strategy, used by precious metal traders for thousands of years as a smart means of increasing metals holding over time. In The Silver Report we examine the five major drivers that are propelling silver prices in 2019. Now is the time to rediscover silver! Get a complimentary copy of The Silver Report today. Call 800-289-2646 or register HERE.

The Capital One Breach: What It Means for You -Wall Street Journal
"In this latest massive consumer-data breach, a hacker accessed the personal information of 100 million Capital One credit-card customers and applicants in the U.S. and six million in Canada. The breach stands to be one of the worst for U.S. consumers because of the type of financial information that was accessed. This valuable consumer financial information can be used to figure out the identities of the most creditworthy or affluent consumers and open a card or loans in their names. Here's what you need to know if you have a Capital One credit card or have applied for one in the past, and how to protect your accounts and information. Sensitive identity information about consumers and small businesses who applied for Capital One credit cards between 2005 and 2019 was exposed. So if you have a Capital One credit card, or have applied for one in that time frame, your information is part of this data breach. The information leaked includes names, addresses, ZIP Codes, phone numbers, email addresses, dates of birth and self-reported income, the bank said. Consumer data including credit scores, credit limits, balances, payment history and some transaction data are also part of the breach. Also exposed were about 140,000 Social Security numbers and 80,000 linked bank account numbers....There are three things those who either have a Capital One credit card or applied for one should do immediately. First, freeze your credit....Then, change your passwords....After that, set up two-factor authentication for all your financial profiles and online accounts."

How "Free Money" Has Changed Baltimore -Bonner/Bonner And Partners
"Baltimore used to be the richest and most sophisticated city in America. And still today, there are many honest, fair, and noble bipeds in the 7th district; the rest commute to Washington. The typical Trump tweet is a jolly mix of fantasy and claptrap. But on Sunday, there was more truth in the tweet that took aim at the 7th congressional district and its representative. Trump’s opportunity came when Rep. Elijah Cummings took on the U.S. Border Patrol, yelling at its chief during congressional hearings. Trump counterattacked: 'If he spent more time in Baltimore, maybe he could help clean up this very dangerous & filthy place'....By the mid-20th century, the self-reliance and small government ideas that had built Baltimore were giving way to new ideas. People were beginning to think that the federal government could make life better for everyone - by spending money....The Heritage Foundation claims that $22 trillion has been spent on anti-poverty programs over the last half-century (adjusted for inflation). Much of that money must have gone to Baltimore...But free money is an attractive nuisance. Whether you give it to the poor or to the rich, it has the same effect. The Federal Reserve's free-money lending rates, for example, encourage savers not to save and risk-takers not to take up the risks and hard work of satisfying real customers. They lure businesses not to do more business; instead of investing in new plants, new equipment, and new employees, they make their shareholders wealthy by manipulating stock prices with ultra-low-interest loans....Poverty programs work the same way. When you pay people to be poor… they don't exactly get up at 6 a.m… bright-eyed and bushy-tailed, eager for another day of work and innovation. Instead, like people on the federal payroll everywhere, they waste time and money… confident that the next checks will come, no matter what they do."

RealMoneyBlog - Free daily/weekly email


Previous Months

2019

July
June
May
April
March
February
January

2018

December
November
October
September
August
July
June
May
April
March
February
January

2017

December
November
October
September
August
July
June
May
April
March
February
January

2016

December
October
September
August
July
June
May
April
March
February
January

2015

December
November
October
September
August
July
June
May
April
March
February
January

2014

December
November
October
September
August
July
June
May
April
March
February
January

2013

December
November
October

Follow Us

Share Page

Weekly Charts

Current Spot Prices

Gold$1513.19
Silver$17.11
Platinum$849.65

Special Offers

 
 
© 2019 Swiss America Trading Corp. All Rights Reserved.   |   Privacy Policy   |   Site Map   |   Contact Us   |   Mobile Version
SWISS AMERICA and Block Logo are registered trademarks of Swiss America Trading Corp.
Where did you hear about us?
Pat BooneMichael Savage
OtherCoast to Coast with George Noory
Mark Levin700 Club
Steve Deace
×