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5.23.18 - Inflation Barreling Toward Consumers
Gold last traded at $1,293 an ounce. Silver at $16.47 an ounce.
NEWS SUMMARY: Precious metal prices traded mixed despite dollar strength ahead of Fed minutes. U.S. stocks fell on renewed China trade worries while awaiting the Fed's latest inflation outlook.
Inflation is coming to the US economy on an 18-wheel flatbed -CNBC
"Multiple signs of inflation in freight-related industries are at or near historical highs, in what could be an early sign that price pressures are building and ready to reverberate around the economy....Recent readings show demand for vehicles skyrocketing, a sign that generally points to inflationary pressures building up in the supply chain. 'It's an indication that there's capacity pressure in the marketplace, that brokers are searching more and posting more in order to find a truck,' said Peggy Dorf, market analyst at DAT. 'This is an indicator that pressure is much higher than it was a year ago.' Every other broad market trend line that DAT posts was up double digits on a year-over-year basis - including the all-important fuel costs, which are up 20 percent....It all adds up to an environment that could prove tricky ahead. The Federal Reserve is continuing to raise interest rates, with at least two more quarter-point hikes expected this year."
The Case for a New International Monetary System -Sheldon/CATO
"Today there are compelling reasons - political, economic, and strategic - for President Trump to initiate the establishment of a new international monetary system....The vision of providing a solid monetary foundation for global free trade was shattered by Nixon's decision to suspend gold convertibility of the dollar....It's time to reassert the primary functions of money as (1) a medium of exchange, (2) a unit of account, and (3) a store of value....In proposing a new international monetary system linked in some way to gold, America has an opportunity to secure continued prominence in global monetary affairs while also promoting genuine free trade based on a solid monetary foundation. Gold has historically provided a common denominator for measuring value; widely accepted at all income levels of society, it is universally acknowledged as a monetary surrogate with intrinsic value. Speaking in February 2017, former Federal Reserve Chairman Alan Greenspan defined gold as the 'primary global currency' and further added, 'We would never have reached this position of extreme indebtedness were we on the gold standard, because the gold standard is a way of ensuring that fiscal policy never gets out of line'....We make America great again by making America’s money great again."
Will the Trump administration take steps to propose a new international monetary system linked with gold? We hope. Meanwhile, you can take steps to put your family on a PERSONAL Gold Standard starting today, by calling Swiss America at 800-289-2646 or requesting our FREE 2018 Real Money Perspectives newsletter, The Future of Money.
Who sanctions America? -Bonner/Bonner And Partners
"The Dow jumped over 25,000 yesterday. But unless (and until) it can beat the January top of 26,616, we will presume that the primary trend is down. And since primary trends tend to last a long time, we further presume that stocks may be set to slide for the rest of our lives. Big moves take time. Stocks peaked out in August 1929. Inflation adjusted, it was not until 30 years later that they fully recovered. They peaked out again in 1966. And again, it took 30 years for an investor to get his money back in real terms (not including dividends). If this pattern holds, the peak in January won't be seen again until 2048. Good luck with that!....Nature needs balance and harmony. Civilization thrives on limits, restraints, and corrections. 'Too much' upsets it. When there is 'too much,' something has to give. Otherwise, it tips over into chaos and calamity. After the Cold War ended, the U.S. was master of the field… unopposed… on the top of the heap. It could have brought its troops home and cut its military spending in half… or more… restoring some measure of balance with the rest of the world....The 'enemy' was defeated. But military spending still went up, and now sits at $580 billion, up from $355 billion in 1991....Americans are perfectly happy with this situation. Neither Democrats nor Republicans resist."
A Central Banker's Plan for Your Money -Daily Reckoning
"Jim Rickards calls them 'silent dog whistles.' Through these signals, in the frequencies beyond normal human hearing… elites communicate with each other. Their communications are public. But their language can be so thick, so technical - so innocuous - not one in a hundred can crack it open....Hold this information close when you consider the recent speech by a certain Benoit Coeure...This Coeure fellow is a grandee of the European Central Bank (ECB)....Let us...translate: 'Cash limits our options as central bankers. Private citizens should not be allowed so large a voice in monetary affairs. Besides, no one wants it anyway. The time has come to discard cash altogether, as we previously discarded the 'barbarous relic,' gold....Cryptocurrencies are a threat to our control of the monetary system. Unacceptable. We cannot stop the technology, so we must co-opt it. We must ensure that the masses can only use authorized cryptocurrency - ours, that is. We must ban all rival cryptocurrencies.'....The problem comes back to cash. No one will pay the bank to hold their cash, so the masses would withdraw their money from the banking system. Cash therefore prevents us from employing truly negative interest rates. In consequence, cash must go. Once all money is digital, we'll completely capture the monetary system and can make negative interest rates a reality....The elites must ban cash so they can herd us all into the 'digital pens.'...Then when the next crisis strikes, it's off to the digital pen… to be sheared."
In our new White Paper, THE SECRET WAR, PART II: Weapons of Cash Destruction, we reveal more of the worldwide scheme to stop the private use of cash and force people into banks and credit cards so that every transaction can be controlled, tracked and taxed.
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5.22.18 - Will Cryptos Evolve Into Useful Money?
Gold last traded at $1,292 an ounce. Silver at $16.57 an ounce.
NEWS SUMMARY: Precious metal prices steadied Tuesday on bargain hunting and a flat dollar. U.S. stocks were level as investors paused following a statement by President Trump expressing doubts about the proposed June North Korea summit.
Gold inches higher as dollar rally runs out of steam -Business Day
"Gold edged up on Tuesday from a 2018 low, adding traction as the dollar fell off its five-month high, although risk appetite in the broader financial markets kept the precious metal’s gains in check. The dollar lost momentum following a broad rally prompted by rising US bond yields and the prospect of a resolution to US-China trade tensions. A weaker dollar makes dollar-priced gold cheaper for non-US investors. Washington and Beijing both claimed victory on Monday as the world’s two largest economies stepped back from the brink of a global trade war and agreed to hold further talks to boost US exports to China....'The positive views on the US economy are overdone,' said Philip Newman, director at Metals Focus. 'There are concerns over sizeable US debt, there’s the [US] mid-term elections in November, there's enough out there that could see the dollar eventually weaken and gold prices start to improve through the back end of this year.'"
Cryptocurrencies Likely To Evolve Into Useful Money -Rahn/Washington Times
"Money is most often defined as something that serves as a unit of account, a store of value and medium of exchange. Traditionally, a medium of exchange was such things as coins, paper notes and checks....Most transactions now are electronic - bank transfers, cards, cell phone apps, etc. Physical cash has held on because of perverse government anti-money laundering regulations, which make it almost impossible for many to obtain bank and other financial accounts, and for people to maintain some degree of financial privacy. Cryptocurrencies, such as bitcoin, can serve as a unit of account and a medium of exchange, but not as a store of value - as long as there is nothing more than an algorithm to anchor them....Cryptocurrencies are likely to evolve into more useful money substitutes as issuers began to back them with real assets....What is likely to happen is that a number of entrepreneurs will start issuing cryptocurrencies with real backing (experiments are under way) - precious metals, like gold and silver; industrial commodities, like aluminum; and various baskets of commodities, which may even include services. Eventually, one or several will become global standards...Governments will, of course, fight to maintain their money monopolies, but they are likely to lose because they will be offering an inferior product. A world without government monopoly money will be more free and less costly, with more prosperity."
We agree with Mr. Rahn; the primary problem with cyrptos is the missing 'store of value' component of true money - which in the future could be solved by backing them with physical precious metals. Meanwhile, we think owning physical gold is the best protection from both asset and monetary inflation. Get the facts so you can come up with your own conclusions in our FREE 2018 Real Money Perspectives newsletter, The Future of Money.
"Eight More Years!" -Pontification Blog
"Democracy is supposed to be a peaceful form of change that transfers power from one leader or lawmaker to another not by war, revolution, or assassination, but by society's mutual agreement....But since Mr. Trump's overwhelming victory - 304 Electoral Votes to only 227 for Clinton - she and her media comrades and other unelected members of the Deep State have claimed that Ms. Clinton won, or should have been declared the true winner of, the 2016 election. This has turned into more than a rant against President Trump. It has become a relentless attempt to delegitimize his presidency and remove him from office. It has, as many have observed, become on ongoing coup d'etat, a 'taking down' of our democracy. Media create a social contagion of violence, showing children they can gain fame by shooting others, and glorifying celebrities who advocate ways to assassinate President Trump. If the Left cannot get power with ballots, it will use bullets....Special Counsel Robert Mueller is not investigating a crime, as our legal system requires, but pursuing President Trump in hopes of finding a crime, any crime. The techniques of Mueller's team of mostly-Democratic partisan donors and operatives are those of England's Star Chamber and of Tower of London threats of torture to elicit political confessions against the President. This, too, is not how democracy, or justice, are supposed to work. If and when these anti-democratic leftist furies fail in their effort to undo the 2016 election, voters will rightly ask for justice. How can they reclaim their chosen President’s two stolen years of governing?" Full story
The death of the summer job -US News/CNBC
"Teen employment and summer jobs aren't as popular as they used to be. 'Even though some teens still have summer jobs, the proportion of teens who participate in the labor force during the summer has dropped dramatically,' Teresa Morisi, a branch chief at the Office of Occupational Statistics and Employment Projections at the Bureau of Labor Statistics, wrote in a report published last year looking specifically at teen employment declines. 'In July 2016, the teen labor force participation rate was 43.2 percent, down almost 30 percentage points from the high point of 71.8 percent in July 1978.' That participation rate dropped even further last summer. The BLS estimates the labor force participation rate for 16- to 19-year-olds - a measure that tracks the share of teens either employed or actively looking for a job - stood at 42.5 percent in July 2017....But it's not just summer jobs - teen employment throughout the year is down significantly from where it stood in generations past....40.6 percent of teens from households that bring in between $100,000 and $149,999 annually were employed during 2015 and 2016. But just 23 percent of teens from households that earn fewer than $20,000 each year had jobs during that window....'It is counter-intuitive. You think the teens whose households need the money would work more to get the money. But I think what's playing out here are the effects of social networks and norms within the family and belief about the value of work,' Ross says."
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5.21.18 - Mocking the Fed's Definition of Inflation
Gold last traded at $1,290 an ounce. Silver at $16.52 an ounce.
NEWS SUMMARY: Precious metal prices steadied Monday despite a firmer dollar. U.S. stocks rose as trade tensions between the U.S. and China dissipated for the moment.
U.S.-China Trade Truce May Not Last as Differences Remain -Bloomberg
"The U.S. and China declared a truce in their trade dispute over the weekend, but that will prove temporary if the world's two largest economies fail to deliver on their vague commitments to re-balance trade. 'We're putting the trade war on hold,' Treasury Secretary Steven Mnuchin said Sunday after the two sides released a joint statement a day earlier. 'Right now, we have agreed to put the tariffs on hold while we execute the framework.' For now, Mnuchin's cease-fire declaration will soothe the nerves of investors worried that the world's two biggest economies were on the verge of an all-out trade conflict. President Donald Trump had threatened to slap tariffs on up to $150 billion in Chinese imports, and Beijing vowed to respond in kind. Trump on Monday tried to put a positive spin on the negotiations. 'China has agreed to buy massive amounts of ADDITIONAL Farm/Agricultural Products - would be one of the best things to happen to our farmers in many years!' he said in a series of postings on Twitter. 'On China, Barriers and Tariffs to come down for first time.'....Still, there's no guarantee that China’s trade frictions with the U.S. won't re-emerge in the future, a foreign ministry spokesman told reporters Monday at a regular briefing in Beijing."
Mixed Signals on China Trade -Fox Business
Author and Swiss America Chairman Craig R. Smith, VP of Vision 4 Fund Distributors Heather Zumarrago, and Layfield Report CEO John Layfield discuss the recent perceived improvements in the U.S.-China trade negotiations prior to the June 12th U.S.-North Korean summit.
A Warning Signal for Global Stock Markets Is Flashing in Japan -Bloomberg
"Morgan Stanley calls it 'the end of easy,' that witching hour in global stock markets when economic growth is slowing, the Federal Reserve is tightening, and inflation is ticking up. After a long bull run, strategists the world over are getting nervous -- and watching for the top. And over in Tokyo, a warning is starting to flash. A feared rotation is taking hold, as investors dump the shares that propelled the good times, such as industrials and technology companies, in favor of an entirely different class of firms: those needed no matter how bad the economy gets. When investors become less optimistic about the future, the theory goes, that’s where they turn. 'No one can really tell whether global stocks will go into a bear market,' said Yoshinori Shigemi, a global market strategist at JPMorgan Asset Management Japan Ltd., 'But when Japanese defensives outperform, it can be a leading indicator.' Utilities, health-care, consumer staples and real estate stocks - all so-called defensive shares - are the top performers of the 11 industry groups in the MSCI Japan Index this year, beating information technology and industrial companies, so-called cyclical shares."
Turkey Repatriates All Gold From The US In Attempt To Ditch The Dollar -Zero Hedge
"After Venezuela, Germany, Austria and the Netherlands prudently repatriated a substantial portion (if not all) of their physical gold held at the NY Fed or other western central banks in recent years, one month ago Turkey announced that it too has decided to repatriate its gold stored in the US Federal Reserve and deliver it to the Istanbul Stock Exchange, according to reports in Turkey's Yeni Safak. And now, according to a report by the Swiss Schweiz am Wochenende, the repatriation is complete with the Turkish central bank withdrawing all of its gold reserves from the U.S. due to the 'tense political situation.'....Turkey's gold repatriation come at a sensitive time for Turkey's currency, the lira, which has been pounded for the past month, and plunged to all time lows against both the dollar last week amid double-digit inflation in Turkey....The NY Fed still holds the world hostage thanks to its custodial holdings of 5,750 thousand tons of foreign-owned gold."
Collapsing Iran and Venezuela Mock the Fed's Definition of Inflation -Tamny/Forbes
"It changes by the day, but Iran’s currency - the rial - is falling. This is inflation. The value of money declines such that holders of it can exchange it for fewer and fewer goods and services. Something similar, but exponentially worse, is happening in Venezuela. A recent article in the Wall Street Journal indicated inflation of 13,000% due to a plummeting Bolivar. If Iran's economy is down, Venezuela's is collapsing. The suffering taking place in both countries rates prominent mention in consideration of the modern view of inflation promoted by the biggest employer of economists in the world: the Federal Reserve. According to the credentialed in its employ, economic growth causes inflation. Yes, more people working and prospering supposedly has a downside. According to the Fed, the downside is inflation. Except that the Fed's view of inflation is 100% backwards. Crucial here is that it's backwards in countless ways. Inflation is always and everywhere a function of a declining currency. It's not a growth phenomenon as the Fed suggests. Fed economists would be wise to visit Iran and Venezuela to understand that inflation has nothing to do with prosperity....The Fed's incorrect inflation definition is rooted in a triple falsehood born of the easily disprovable view inside the bank that consumption drives economic growth....Sad is that economists at the Fed are still hung up on a modern definition of inflation that could have only been divined by economists, and that has nothing to do with reality."
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5.18.18 - Mortgage Rates Hit 7-Year High
Gold last traded at $1,292 an ounce. Silver at $16.45 an ounce.
NEWS SUMMARY: Precious metal prices rose Friday on bargain-hunting despite a firmer dollar. U.S. stocks drifted lower as tensions between the U.S. and China weighed on investor sentiment.
When This Happens, Buy-Bonner/Bonner And Partners
"The Dow was below 8,000 when it hit bottom in the last credit crash in 2009. Now, it's over 24,000....While the Dow has more than tripled, the economy that supports it has not. GDP was nearly $15 trillion in 2008. It's only $20 trillion 10 years later. That is not a triple… not a double… not even a 50% increase. It’s just a 33% boost....Super investor Warren Buffett's favorite indicator is the stocks/GDP ratio....And Buffett says that as long as the value of stocks is 80% (or less) of GDP, investors can safely buy. Today, U.S. GDP is the aforementioned $20 trillion. And the value of all equities is about $28 trillion...That gives us a ratio of 1.42...This is the second highest the indicator has ever been… higher than in 2007. The previous record - set in the first quarter of 2000 - was 1.51, which was nearly twice the long-term average. So here's the big picture: Interest rates are going up. As for assets, our guess is that when the stock market gets a load of what 4% rates will do, it will panic… and drop more than expected, faster than expected. When prices get back in Warren Buffett’s buy zone of 80% (or less) of GDP - which they must sooner or later - stocks will have lost about 45% of today’s value. Dow 13,000, in other words. When they get to that level, buy!"
Pope Calls Derivatives Market a 'Ticking Time Bomb' -Bloomberg
"Warren Buffett once called them 'financial weapons of mass destruction.' Now Pope Francis, of all people, is taking aim at derivatives. In a sweeping critique of global finance released by the Vatican on Thursday, the Holy See singled out derivatives including credit-default swaps for particular scorn. 'A ticking time bomb,' the Vatican called them. The unusual rebuke - derivatives rarely reach the level of religious doctrine - is in keeping with Francis's skeptical view of unbridled global capitalism. 'The market of CDS, in the wake of the economic crisis of 2007, was imposing enough to represent almost the equivalent of the GDP of the entire world. The spread of such a kind of contract without proper limits has encouraged the growth of a finance of chance, and of gambling on the failure of others, which is unacceptable from the ethical point of view,' the Vatican said in the document....Income inequality is a priority concern for Francis, who has made humility a distinguishing feature of his papacy. He refused to live in the opulent Apostolic Palace, choosing a guest house for Church officials near St. Peter’s Basilica instead. He uses an old Ford Focus to get around the Vatican and Rome."
Mortgage Rates Hit Seven-Year High as Ultracheap Era Ends -Wall Street Journal
"Mortgage rates this week jumped to their highest level since 2011, signaling a shift from a period of ultracheap loans to a higher-rate environment that could slow home price appreciation and squeeze first-time buyers. The average rate for a 30-year fixed-rate mortgage rose to 4.61% this week from 4.55% last week, according to data released Thursday by mortgage-finance giant Freddie Mac. The jump this year reflects an abrupt departure from a long period of declining rates that began during the financial crisis. Rates bottomed out in late 2012 at 3.31% and clocked in at 3.99% as recently as January. The spike this year has been faster than many economists predicted as a surging economy, the prospect of wage gains and a steep rise in prices for commodities such as lumber and gasoline stoke inflation worries."
The Fed's Been Lying to Us About Inflation - It's Frighteningly High -Money Morning
"Even by the deeply flawed and misleading Consumer Price Index (CPI), inflation is at the U.S. Federal Reserve's target. By other measures that more accurately portray inflation, it is well above target....Furthermore, we know beyond a shadow of a doubt that, as the Fed raises the federal funds rate target, it will only stimulate more inflation. The Fed will always be behind the curve, because the Fed is always back there pushing the curve ahead....And the fact is that we really have more - much more - inflation than they're telling us. This isn't a mistake, it's not a miscalculation. Rather, it's a deliberate obfuscation....In the past few years, house prices have been inflating – consistently – in the 6% to 7% range, but, you guessed it, that is not included in CPI! It's not even counted in the official measures of 'inflation.'....The housing component of CPI is weighted at roughly 40% of core CPI (excluding food and energy). Simple math tells us if housing was included in CPI, then total core CPI would be 40% of the difference between the OER measure, at 3.4%, and the actual housing inflation rate of between 5.8% and 7%....Had housing prices been included in core CPI, it would never have read below 2%. It would have been in a range of 2.5% to 4.5% over the past five years."
US Birth Rate Hits All-Time Low: What's Behind the Decline? -Live Science
"The number of babies being born in the United States continues to fall, with the birth rate reaching a new record low in 2017, according to a new report from the Centers for Disease Control and Prevention. Last year, about 3.8 million babies were born in the U.S., which is 2 percent lower than the number born in 2016, and the lowest recorded number of births in 30 years, according to the report. Part of the reason for the decline in U.S. birth rates may be that people are in a general state of economic uncertainty, said Karen Benjamin Guzzo, associate director of the Center for Family & Demographic Research at Bowling Green State University in Ohio. Even though the Great Recession technically ended in 2009, people may still feel uneasy about their economic situation; they may be employed but working part time, or going to school and working, or trying to pay off student loans, Guzzo said....In addition, young adults may feel like they haven't met all the milestones they feel they need to reach before having a kid, such as getting a college degree, having a stable income and getting married. 'It takes longer to feel like you're a grown-up,' Guzzo said."
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5.17.18 - China's Gold Demand Keeps Rising
Gold last traded at $1,289 an ounce. Silver at $16.48 an ounce.
NEWS SUMMARY: Precious metal prices traded steady Thursday on bargain hunting despite a firmer dollar. U.S. stocks rose as energy stocks were boosted by $80 a barrel oil prices amid Iranian export worries.
Gold Preparing to Launch -Sprott Money
"The positioning of the Money Managers, or 'Funds', in the Gold futures market is at extremes that have typically led to massive rallies in Gold. They are usually net long...when their net long position is sufficiently low, it tends to lead to significant rallies in the price of Gold....We could see a rally of anywhere from 7% to 13% based on prior rallies. At the close of $1288 on Tues, this would mean a rally to somewhere between $1378 to $1455. Sounds good right? But we don't have to rely on positioning alone for such a forecast. Sentiment is a great tool to gauge the direction of all markets, but it works especially well in Gold and Silver markets...It is showing extreme bearishness in Gold right now....In summary, based on positioning, sentiment, technicals, inter-market analysis, Elliott Wave Theory and similar readings prior to previous rallies, Gold is at or close to a low here that is likely to set off a rally to $1360 or higher in the coming weeks."
Europe to ditch US dollar in payments for Iranian oil -RT
"The European Union is planning to switch payments to the euro for its oil purchases from Iran, eliminating US dollar transactions, a diplomatic source told RIA Novosti. Brussels has been at odds with Washington over the US withdrawal from the Iran nuclear deal, which was reached during the administration of Barack Obama. President Donald Trump has pledged to re-impose sanctions against the Islamic Republic. 'I'm privy to the information that the EU is going to shift from dollar to euro to pay for crude from Iran,' the source told the agency. Earlier this week, EU foreign policy chief Federica Mogherini said that the foreign ministers of the UK, France, Germany, and Iran had agreed to work out practical solutions in response to Washington's move in the next few weeks. The bloc is reportedly planning to maintain and deepen economic ties with Iran, including in the area of oil and gas supplies....The Iran nuclear deal, known as the Joint Comprehensive Plan of Action (JCPOA), was sealed three years ago in Vienna between Tehran and the P5+1 powers (China, France, Russia, UK, US, plus Germany)....Switching to alternative settlement currencies allows both sides to continue trading despite US sanctions."
China Gold Demand Off To Hot Start -Zero Hedge
"It looks to be another boom year for gold. Investors are anticipating a continued demand for the precious metal for the fifth year in a row, driven by geopolitical uncertainties and less-than-strong predictions for the U.S. economy and the U.S. dollar in 2019. In times of economic turmoil, gold has always served as a hedge against the decreased value of stocks or currency. Faced with unusual market volatility, people around the globe are turning to the yellow metal as a haven and safe investment diversifier. The price of gold rose by 14 percent in 2017 and is likely to go higher. While the U.S. dollar is expected to lose some value in 2018, the Euro and other currencies are showing a modest gain....During the first quarter of 2018, India saw a 12 percent decrease in demand for gold jewelry from the same period in 2017....China, the world's major importer of gold, has been actively accumulating gold and is expected to continue doing so in the near future....Gold has always been in demand for its intrinsic value. If current trends continue and the demand for gold accelerates at its current rate, the price of gold will skyrocket."
5 steps to ease your worries about money, health in retirement -USA Today
"We asked financial planners what their clients who are planning for or living in retirement worry about and what can be done to alleviate those worries. 1) Catch up if you haven't saved enough - Do this by estimating how many years your money would last if you withdrew 4% a year for 30 years. 2) Rethink spending - If there are shortfalls...Reduce expenses, retire later and save more. 3) Discuss long-term care - Talk also to a trusted health care broker about the Medicare options and drug plans, based on preferences and needs. 4) Have an investment plan - More than a few pre-retirees worry what will happen to their income if the stock market plunges...set aside 15 to 18 months of cash to cover expected portfolio withdrawals during the length of a typical recession. 5) Plan for cognitive decline - To alleviate this worry, put in place documents and plans in case you experience dementia, Alzheimer’s disease or cognitive decline."
To this wise list, we would add #6: Diversify a portion of your retirement funds into a Precious Metals IRA for safety and growth. A Precious Metals IRA also offers increased peace of mind during times of rising market volatility. Call a Swiss America representative to discuss it further at 800-289-2646. Request our free Precious Metals IRA Guide.
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5.16.18 - Billionaires Keep Faith in Gold
Gold last traded at $1,291 an ounce. Silver at $16.40 an ounce.
NEWS SUMMARY: Precious metal prices steadied Wednesday on bargain hunting despite a firmer dollar. U.S. stocks rose as retail shares jumped following strong quarterly earnings from retailer Macy's.
John Paulson and Ray Dalio Stay Loyal to Gold -Bloomberg
"Billionaire hedge-fund managers John Paulson and Ray Dalio kept their faith in gold even as rising interest rates trim the metal's gains. As of March 31, New York-based Paulson & Co. had 4.32 million shares in SPDR Gold Shares, the biggest exchange-traded product backed by bullion, according to a regulatory filing. That compares with 4.36 million shares at the end of December. Billionaire Ray Dalio’s hedge fund Bridgewater Associates also maintained its stake in SPDR and iShares Gold Trust, the second largest bullion-backed ETF....Gold advanced 1.7 percent in the first three months of 2018 as the dollar weakened a fifth straight quarter, helping the precious metal withstand the headwind from rising U.S. borrowing costs."
Gold at a New Low for the Year, but ETF Investors Still Love It -Wall Street Journal
"Gold prices slumped, falling below the $1,300 level for the first time since December as a rising dollar and higher Treasury yields led traders to dump the precious metal. But while the bullion price in the futures market on Tuesday reached a new low for the year, exchange-traded-fund investors recently have been bullish on gold. Investors poured about $3.1 billion into gold-backed ETFs during April, the highest total since February 2017, data from the World Gold Council, an industry trade group, showed....ETF buyers and other bulls have turned to gold as a traditional haven play during turbulent political times, with the prospect of a trade war still looming, uncertainty swirling around North Korea and tensions in Syria and Iran flaring up. Some money managers are also using gold to hedge against a pickup in inflation signaled by recent consumer-price data....'There are major economic, financial and political issues on the horizon that suggest stronger investment demand and higher prices at some point - but they're not here now,' said Jeffrey Christian, managing partner at commodities research and asset-management firm CPM Group."
Gold's Recent 2% Decline Is a Buying Opportunity - Natixis -Kitco
"While gold prices may have further room to fall in the near term, one French bank says current prices represent an exciting entry point for investors. In a report published Wednesday, Bernard Dahdah, precious-metals analyst at Natixis, warned that gold prices could fall as low as $1,275 an ounce as the market deals with a stronger U.S. dollar as a result of rising bond yields....However, despite the potential for near-term weakness, the bank's base-case scenario is for gold prices to average the year around $1,345 an ounce."
The Injustices Of Keynesianism -Forbes
"What are Keynesianism's big negatives, particularly in the moral direction?....The central idea of Keynesianism, the namesake doctrine of British economist John Maynard Keynes, as set out in his magnum opus The General Theory (1936) is that the market, left alone, leads to sub-optimal outcomes. This happens because of a mechanism Keynes called the 'liquidity trap.' If you let the market run, wealth will be unevenly held, and many people with money will sit on it. Capital becomes 'trapped.' The result is idle productive resources. Those who would really benefit from more production via higher wages or jobs or consumption, i.e. the poor and the struggling, are deprived. Keynes's solution was to introduce a non-market agency, the government, to call into use the productive resources left idle given the liquidity trap....Which brings us to Keynesian injustice #1. The classical test cases of Keynesianism were the big government tax, spending, and regulatory initiatives of the 1930s and the 1940s, first the New Deal and then World War II. As the Franklin D. Roosevelt administration conceded after the brutal 1937-38 recession, six years into the New Deal, the big domestic programs of the 1930s did not put an end to the Great Depression....As for Keynesian injustice #2, it inheres in the scourges of our own day, the opioid crisis and mass incarceration...Government can throw everything else at the wall - housing assistance, green-economy mandates, SNAP and CHIP for the kids, prescription drug benefits, etc. of recent experience - and it will all fail, as we learned in the 1930s/1940s....Say’s Law (after Jean-Baptiste Say of 200 years ago), defines entrepreneurs as those who see what people need, even before they themselves do, and get to work providing it. Their standard is other people's success. Not so for Keynesianism."
Are Electric Cars Worse for the Environment? -Manhattan Institute
"Crunch the numbers, and it looks like all those subsidies might be counterproductive. If you believe the headlines, traditional automobiles are speeding toward a dead end. All those V8s, V6s and turbocharged vehicles we've grown to love will soon be replaced by squadrons of clean, whisper-quiet, all-electric vehicles. And if you believe the headlines, the environment will be much better off. Policymakers at every level have done their part to push electric vehicles by creating a tankful of subsidies. Thanks to laws signed by both George W. Bush and Barack Obama, electric-vehicle buyers can feast on federal tax credits of up to $7,500 that reduce the initial purchase cost of their vehicles....All of this might make sense if electric vehicles, as their supporters claim, were truly likely to reduce air pollution and tackle climate change. But are they? To answer that question, I used the U.S. Energy Information Administration's most recent long-term forecasts for the number of new electric vehicles through 2050, estimated how much electricity they'd use...What I found is that widespread adoption of electric vehicles nationwide will likely increase air pollution compared with new internal combustion vehicles. You read that right: more electric cars and trucks will mean more pollution....Cars are charged from the nation's electrical grid, which means that they're only as 'clean' as America's mix of power sources. Those are getting cleaner, but we still generate power mainly by burning fossil fuels: natural gas is our biggest source of electricity, and is projected to increase. And coal, while still declining, will remain the second largest source of electricity for some time....To be sure, electric cars are impressive. But there is no economic or environmental justification for the many billions of dollars in subsidies that America is already paying to speed their adoption. So what to do? First, Congress should immediately terminate those electric-vehicle tax credits, which just benefit the wealthy."
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