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11.13.18 - "Most Overvalued Market in History"
Gold last traded at $1,201 an ounce. Silver at $13.97 an ounce.
NEWS SUMMARY: Precious metal prices rose Tuesday on bargain-hunting and a weaker dollar. U.S. stocks zig-zagged in volatile trading as a bounce in Apple shares helped lift the broader technology sector.
Is the US the most overvalued stock market in history? -Fox Business
"Volatility remains a headwind for U.S. stocks in November after October wrapped one of the worst months for stocks since about 2008. And the worst may lie ahead, according to perma-bear and longtime StockMarket Cycles Editor Peter Eliades, who says U.S. stocks are facing 'one hell of a bear market.' 'We are facing what I would consider, and a lot of good value people consider, to be the most overvalued market in history,' Eliades told FOX Business' Neil Cavuto on Monday adding that it could last well into 2022....'I’m looking for at least as bad of a decline as we saw from 2007 to 2009 which was in the minus 55% category,' he said. 'I think we are facing that realistically and perhaps even worse than that.' Eliades clarified he isn't making predictions but rather is basing his outlook on the 20-year market cycle."
'Lame-duck' Congress returns, facing budget, Mueller, border wall issues -Reuters
"The U.S. Congress returns on Tuesday for a post-election 'lame-duck' session, facing a funding deadline to prevent a partial government shutdown, as well as demands for protections for Special Counsel Robert Mueller and money for a proposed U.S.-Mexico border wall. Those issues, plus leadership contests among both Democrats and Republicans, promise to dominate the brief session of Congress wedged in between last week’s congressional elections and the start of the 2019-2020 Congress in January. In the elections, voters ended the Republicans’ majority control of the House of Representatives and gave it to the Democrats, while leaving the Senate in Republican hands. But nothing will actually change until January. For now, Republicans will retain their dominance in both chambers, although Democrats are already ramping up challenges to their partisan rivals and Republican President Donald Trump....The main legislative project for the lame-duck session will be a spending bill, said aides and lawmakers. Passage is needed to keep the Department of Homeland Security and some other agencies operating beyond Dec. 7, when the money runs out."
A Gold Price Forecast For 2019 -Investing Haven
"The gold price started the year quite bullish only to turn bearish around summer time. What does this mean for 2019? We look at our leading indicators in this article in order to do our gold price forecast for 2019. Sometimes gold can rise because of fear, but for gold to rise on the gold long term there must be some rising real rates....We do not recommend to get caught up in the endless stream of headlines. It will only confuse investors....Our leading indicator analysis suggests the following for our gold price forecast for 2019: the COT report says gold is near a major bottom and that gold will not dip below $1200 in the next few months going into 2019, the real inflation rate is mildly bullish, the Euro is not showing signs of wild moves....We tend to believe that the price of gold will go up to the $1300 area in 2019...Gold is setting a range... the $1200 to $1375 range....Our most bullish gold price forecast for 2019 is that gold will hit $1550 in 2019 (20% probability), but only if it succeeds breaking through the $1375."
Amazon Picks New York City, Northern Virginia for Its HQ2 Locations -Wall Street Journal
"New York City and Northern Virginia will be the homes for Amazon.com Inc.'s second and third headquarters, according to people familiar with the matter, ending a more than yearlong public contest that started with 238 candidates and ended with a surprise split of its so-called HQ2. Amazon is dividing the second headquarters evenly between New York’s Long Island City and Arlington County’s Crystal City neighborhoods, which are both located directly across from the major city centers. The company plans to evenly split the operations with as many as 25,000 employees in each location. The decision effectively gives Amazon a major presence in three coastal hubs that politically lean left, at a time when tech companies are under scrutiny for their perceived elitism and liberal social views....Amazon’s move to New York pits it against rival Google, which is gearing up for its own expansion in the city."
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11.12.18 - Job Help: Military Veterans' Top Request
Gold last traded at $1,204 an ounce. Silver at $14.02 an ounce.
NEWS SUMMARY: Precious metal prices fell as the dollar touched 2018 highs. U.S. stocks traded sharply lower as Apple shares declined and a strong dollar increased worries about global trade.
Next Market Crash Will Put October Meltdown to Shame -Hussman/Business Insider
"If you thought the stock market correction in October was bad, you ain't seen nothing yet. So says John Hussman, the former economics professor and current president of the Hussman Investment Trust....'Speculative psychology has always allowed valuations to run well beyond historical norms over portions of the market cycle,' Hussman wrote in a recent blog post....'Despite its discomfort, the market decline we observed in October is only a drop in the bucket toward normalizing valuations,' Hussman said. 'Over the completion of the current market cycle, I fully expect the S&P 500 to lose close to two-thirds of its value from the recent peak.'....In the end, the more evidence Hussman unearths around the stock market's unsustainable conditions, the more worried investors should get. Sure, there may still be returns to be realized in this market cycle, but at what point does the mounting risk of a crash become too unbearable?"
Understanding The Global Recession Of 2019 -Charles Hugh Smith/Zero Hedge
"2019 is shaping up to be the year in which all the policies that worked in the past will no longer work. As we all know, the Global Financial Meltdown / recession of 2008-09 was halted by the coordinated policies of the major central banks, which lowered interest rates to near-zero, bought trillions of dollars of bonds and iffy assets such as mortgage-backed securities, and issued unlimited lines of credit to insolvent banks, i.e. unlimited liquidity....The success of these policies has created a dangerous confidence that they'll work in the next global recession, currently scheduled for 2019....Unprecedented asset purchases, low rates of interest and unlimited liquidity have inflated gargantuan credit / asset bubbles around the world, the so-called everything bubble....So how do central banks normalize their unprecedented policies without popping the asset bubbles they've created? The short answer is: they can't....Now that central banks have inflated assets into the stratosphere, there's $300 trillion in global financial assets sloshing around seeking higher yields and capital gains. How much of this $300 trillion can central banks buy before they destabilize currencies?"
U.S. on a Course to Spend More on Debt Than Defense -Wall Street Journal
"In the past decade, U.S. debt held by the public has risen to $15.9 trillion from $5.1 trillion, but financing all of that debt hasn't been a problem. Low inflation and strong global demand for safe U.S. Treasury bonds held the government's interest costs down. That's in the process of changing....In 2017, interest costs on federal debt of $263 billion accounted for 6.6% of all government spending and 1.4% of gross domestic product, well below averages of the previous 50 years. The Congressional Budget Office estimates interest spending will rise to $915 billion by 2028, or 13% of all outlays and 3.1% of gross domestic product....Debt as a share of gross domestic product is projected to climb over the next decade, from 78% at the end of this year - the highest it has been since the end of World War II - to 96.2% in 2028, according to CBO projections. At the same time, the Federal Reserve is in the process of gradually raising short-term interest rates."
Job help is US military veterans' top request after serving -Fox Business
"After leaving the military life, the transition into the civilian workforce can often be difficult for many veterans who don’t have the proper skills to get a good job. But one nonprofit aims to help the thousands of military veterans transitioning to succeed in the workforce. 'What we are really trying to do is empower the veterans to find a great civilian job,' said Hire Heroes CEO Christopher Plamp to FOX Business' Maria Bartiromo. 'There's 190,000 that transition every year and they really don't have the skills, they really don't know how to get into a great civilian job.' Plamp said employment Opens a New Window. Help is the No. 1 thing veterans ask for after getting out. And despite some assistance from corporate America, most aren't familiar with the employment process....'One of the main things is that spouse unemployment right now is three to four times the national average for somebody else who would the same education or the same skill level,' he said."
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11.9.18 - Investors Unprepared For Next Downturn
Gold last traded at $1,208 an ounce. Silver at $14.14 an ounce.
NEWS SUMMARY: Precious metal prices fell Friday on profit-taking and firmer dollar. U.S. stocks dropped as losses in oil prices sparked fears of a global economic slowdown.
The End of a Supercycle -Gold Switzerland
"In a world based on fake paper and fake electronic money as well as fake asset values, the real significance of gold has got lost. With endless credit expansion and money printing, all asset prices have exploded and investors have made fake profits that seem real. But the imminent secular downturn of debt and asset markets as well as the world economy will reveal how unreal these profits were as 90% or more of all the paper wealth in the world will go up in smoke. So investors should now prepare for the biggest wealth destruction in history and also the biggest wealth transfer....As wealth preservation investors we are not really concerned that the market takes its time to reveal the real truth. We know it will come. So we can afford to wait patiently. But it now looks like our patience will soon be rewarded. The gold market correction bottomed between 2013 and 2015 depending on which currency you measure it in. Since then it has spent a long time gathering the energy for the next leg up in this long term bull market. Technically it now looks like that the waiting is finally over and the explosive phase of this market is about to start. If this analysis is correct, we will soon see a quick move to $1,350 and then straight on to above $1,650....Whether markets start a major secular bear market in the next few weeks or months, it is irrelevant. What is clear is that we are at the end of a supercycle of several hundred years. Once it turns, the down cycle is likely to last for decades and be devastating for the world."
'Smart money' not buying stock bounce could mean a test of October lows -Marketwatch
"Stocks may have ripped higher Wednesday in a bout of post-midterm relief, but the 'smart money' doesn’t appear to be buying into the November bounce, noted one analyst, who argued that equities, as a result, could yet retest their October lows and that any sustained rally may be especially reliant on corporate share buybacks. In a Thursday note, analyst Brian Reynolds of Canaccord Genuity focused on the so-called smart index, which remains weak despite a stock market rebound that’s produced a 3.2% rise for the S&P 500 since the end of October and a 3.7% rally for the Dow Jones Industrial. Reynolds argued that the continued bearishness of investors despite the bounce in stock prices indicates that debt-fueled buybacks will be even more important in bringing stocks back up to trend than they have been following other corrections during the current bull market. And since many small-cap companies can’t access the credit market, large-cap companies are more likely to lead the way higher, he said."
How Worldpay Is Winning In The War On Cash -Forbes
"The Economic Times of India reported in August that Berkshire Hathaway was in talks to invest $286 million to $357 million in One97 Communications. That's the company behind India's largest mobile-payment platform. This is potentially the Oracle of Omaha's first direct investment in India. And it's a wake-up call for investors...There is a war on cash. Winners are emerging. One 97 Communications is the parent to Paytm, a high-flying Indian startup. It rose to prominence two years ago when the Indian government pulled 86% of its cash from circulation in an effort to thwart tax cheats. Digital wallets were the logical beneficiaries. You don’t need a degree in rocket science to see what is happening: Eliminating cash makes financial transactions less opaque. It makes them trackable by corporations and governments. Worldpay Inc. is at the center of this assault on cash. The Ohio company provides card-processing machines, integrated point-of-sale and virtual terminals, accounting integration software and ATM services."
For the latest developments in the ongoing war by governments worldwide upon your freedom, your privacy and your cash; request a FREE copy of our 2018 White Paper, THE SECRET WAR, PART II: Weapons of Cash Destruction.
The Average Investor Unprepared For the Next Market Downturn -Real Clear Markets
"The last month has been a particularly choppy one for markets, with the CBOE Volatility Index (VIX) spiking more than 80% during October. It’s apparent that the combination of rising interest rates, mounting trade tensions and early-stage recession fears are setting in. But what's more unsettling is how unprepared the average client is to navigate the next market downturn....The harsh reality is that the investible universe is radically different today than it was during the 2008 crisis. It’s increasingly difficult for investors to achieve true diversification in a world where asset classes and investment styles are highly correlated....This absence of a safety net means the destruction of capital may be permanent when a bear market wreaks havoc....Although today's euphoric environment has led many to forget the pain caused by the Great Recession, we must remember cycles have beginnings and ends. A truly modern portfolio should be built to navigate every step of that journey. Investors will need accessible alternative investments to help protect precious capital, generate income and smooth out returns over a full cycle."
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11.8.18 - Will Fed Statement Heighten Volatility?
Gold last traded at $1,225 an ounce. Silver at $14.43 an ounce.
NEWS SUMMARY: Precious metal prices traded steady Thursday on a flat dollar ahead of today's Fed statement. U.S. stocks retreated following big gains in the previous session as investors focused on the latest monetary policy decision from the Federal Reserve.
Volatility Heightens Focus on Fed Statement -Wall Street Journal
"Few people expect the central bank to raise its key policy rate above its current target of 2% to 2.25% when the Fed concludes its two-day meeting Thursday. There is also no press conference after the meeting, limiting officials' ability to communicate their outlook. Officials will, however, release a statement that analysts say could potentially tip in a dovish or a hawkish direction. A glancing reference to recent market volatility or tightening financial conditions could be interpreted as a sign that officials are taking that volatility seriously, and proceeding cautiously about raising interest rates should it continue. At the same time, a reference to rising wages or other forms of inflation pressure could send the opposite signal: that officials are more concerned about inflation than skittish markets and are prepared to raise rates even faster than investors are anticipating. Either move could send ripples through markets while many investors remain uncertain about the economic outlook....If Fed officials lean harder in a hawkish direction - suggesting they'll keep raising rates to the point where it curtails economic activity - investors can expect more volatility, said Priya Misra, head of global rates strategy TD Securities in New York."
Bitcoin Will Burn the Planet Down. The Question: How Fast? -Wired
"Max Krause was thinking of buying some bitcoin, as one does. But Krause is an engineer - mostly he works on modeling greenhouse gas emissions from landfills - so his first step was to run the numbers....'I thought, man, this is a lot of energy,' Krause says. 'I thought, it can’t be true that people are using this much energy. But it is.'....Krause's paper tries to make the link between metaphorical bitcoin mining and actual, mining mining by comparing the energy it takes to get the equivalent of $1 worth of cryptocurrency and $1 worth of various valuable metals - gold, platinum, some rare-earths, and so on. The answer: It takes more energy to get a buck’s worth of bits. It was 17 megajoules for a dollar's worth of bitcoin but just 4 MJ for a dollar's worth of copper....Krause's numbers show that bitcoin produces a lot more CO2 than the other currencies, but also that a bitcoin mined in China emits four times the CO2 than a Canadian-grown bitcoin....Everyone knows cryptocurrencies are a planet-burner....'And if the government of China or the US decide bitcoin is a threat to civil society with its electricity usage, it's not going to survive,' says Joseph Bonneau, a cryptocurrency researcher at New York University....You should probably be asking if Krause started mining bitcoin. 'I did not,' he says. 'I was better off buying the coins and holding them than trying to build a rig.' In other words, it was the bad outcome: cryptocurrency not as a mechanism for government-free, secure commerce but merely as a speculative instrument."
So the truth is, Bitcoin is not even in the running to replace our present currency system, let alone Gold; the foundation of all sound money. That is exactly what we told our readers last January in our 2018 Real Money Perspectives newsletter, The Future of Money as a speculative fever temporarily pushed Bitcoin prices above $20,000 each!
How Gold Outshone Bitcoin In October -Constable/Forbes
"When investing in alternative assets gold remains the king. The yellow metal performed far better than the world's best-known cryptocurrency, Bitcoin, during October's market volatility. When investors buy alternative assets, they typically look for two things. First, they want to know how the asset will perform as a safe-haven asset during times of market volatility....While stocks fell, gold prices gained. Prices for the yellow metal started the month at $1,189 a troy ounce and were recently trading at $1,220, according to data from Bloomberg. Meanwhile, Bitcoin, which has been much heralded as a new alternative asset, lost value. The price of one Bitcoin started the month fetching $6,573 and was recently trading for $6,271. That's a drop of more than 4% in October....The second thing that investors usually want from an alternative asset is diversification. When one asset price zigs, the hope is that another asset price will zag. Gold performed that function admirably during October. While stocks slid, gold rallied...There was a zig for the zag."
Can Dems Reverse Trumponomics After Winning Back The House? -Investors
"As the election results show, the Senate will be Republican. The House will be Democratic....There will be no Trump-friendly economic legislation to emerge from the House. Trumponomics won't come to an end, but it will be hard to enlarge its scope....A Pelosi-led party, with leftists in key power posts, will try to stymie Trump's economic initiatives. A Tax Reform 2.0, making this year's tax cuts permanent? Forget about it. Build a wall? Might be tough. A hard line on illegal immigration? The House will do what it can to block any Trump initiatives. A Democratic House might try to roll back Trump's tariffs, too. They may even try to reverse some of Trump's other unquestionably successful growth-oriented policies....What would Democrats be halting? The last two quarters GDP growth has averaged roughly 3.8%. Unemployment is now at a 50-year low of 3.7%, while nearly 157 million people now are working. That's an all-time record. And unemployment for minorities and teenagers is at or near all-time low levels....Americans have voted for gridlocked government because, in their wisdom, they don't seem to want either party to have an upper hand. Fair enough. But it will be up to the Republican-led Senate to make the case that Trumponomics beats the increasingly far-left economics of the Democrats."
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11.7.18 - East Trusts Gold, West 'Mindless Optimism'
Gold last traded at $1,231 an ounce. Silver at $14.64 an ounce.
NEWS SUMMARY: Precious metal prices inched higher Wednesday on dollar weakness. U.S. stocks cheered midterm election results.
East trusts physical gold while West prefers 'mindless optimism' -Claudio Grass/RT
"The latest data from the World Gold Council (WGC) shows that central banks in Eastern Europe and Asia significantly boosted their gold holdings. RT talked to Claudio Grass, an independent precious metal advisory based out in Switzerland to find out why....RT: For years, Russia, China, India as well as many Asian countries have been stockpiling gold. More recently, countries like Poland and Hungary have begun to increase national gold reserves. What's behind the move? Claudio Grass: Whoever buys physical precious metals, be it an institution, an individual or as we see now, central banks from different countries, largely have the same reasons for doing so: They all want to regain independence and sovereignty. This is achieved by decoupling from a financial system that is unsustainable, overstretched and founded on nothing but faith in government....RT: Are these countries bracing for a potential currency crisis? CG: Of course. It is impossible to create wealth out of nothing, and even though that is an eternal and universal truth, it hasn't stopped states from trying to do exactly that. Unfortunately, if history teaches anything, it is that we don't learn from it...We are sitting on a gigantic bubble in terms of illusionary financial 'wealth', at the end of a long-term debt cycle and the bill for the massive credit spending of the past decade is about to come in....I think complacency and overconfidence are the key markers of the western approach to the future at the moment...The same, arguably, applies when opting for paper gold over physical. Realism has lost over mindless optimism, placing the East at a significant advantage during the next economic crash....people who buy gold understand that it is their personal insurance when the illusion fades and the trust in the current institutions crumbles."
'Welcome to gridlock': Stock traders cheer, dollar investors jeer US midterm results -Business Insider
"Global markets were broadly higher Wednesday, but reaction to news overnight that the Democratic Party had taken control of the US House of Representatives seemed to have little major impact on sentiment....'Welcome to gridlock,' Paul Donovan, the chief economist at UBS Wealth Management, said on Wednesday morning. 'Trump may now fall back on policy areas that do not require Congress, like trade.' 'As this outcome was widely anticipated, we see little immediate market impact,' UBS Wealth Management said in a note issued by its chief investment office....'Without common ground on areas to cut spending, the budget deficit is likely to remain higher than usual, keeping upward pressure on long-term government bond yields,' they said. The prospect of gridlock seems to have affected the US dollar, with the dollar index dropping by about 0.6%. 'The USD has edged gradually lower against many of its counterparts over the course of this week, with this related to expectations that the Democrats winning some influence could provide some legislative resistance towards Trump further pushing forward pro-America policies,' FXTM's Jameel Ahmad said in an email."
"Democratic Socialist" Alexandria Ocasio-Cortez Becomes Youngest Woman Elected To Congress -Zero Hedge
"While Democratic Congressional candidates in key battleground districts struggled to defeat a host of surprisingly resilient Republican incumbents, self-described 'Democratic socialist' Alexandria Ocasio-Cortez cruised to victory in New York's 14th Congressional district, which straddles parts of the Bronx and Queens, becoming - at the tender age of 29 - the youngest woman ever elected to Congress....Prior to becoming involved in politics, the 'girl from the Bronx' (who spent most of her childhood in a comfortable home in suburban Westchester County) and daughter of Puerto Rican parents had been working as a bartender and Bernie Sanders organizer in NYC after graduating from Boston University when she was plucked from obscurity by progressive groups like 'Our Revolution.'.... Alexandria, who was championed by the Democratic Socialists of America, an insurgent socialist organization, will now bring her inchoate policy agenda, which includes a 'jobs guarantee', free college tuition, medicare for all, abolishing ICE and 'housing as a human right', to Washington, where she will no doubt find a niche on the far-left of an increasingly progressive Democratic Party."
Record Number of Markets Now in the Red in Worst Year Since 1901 -Bloomberg
"2018 is going down as the worst year for markets ever, by at least one measure. A whopping 89 percent of assets have handed investors losses in U.S. dollar terms, more than any previous year going back more than a century. The metric comes courtesy of Deutsche Bank AG....The October stock rout has delivered a wake-up call to money managers searching for shelter this year. Swelling dollar-funding costs, equity volatility and fissures in the synchronized growth story are punishing assets across the globe. A month ago, U.S. stocks were one of just a handful of markets that had doled out a decent return in 2018 - before $2 trillion was wiped off their value in the space of a few weeks....European shares are in worse shape. The Stoxx Europe 600 Index has shed over 10 percent this year in dollar terms....Life is bleaker for multi-asset investors in real terms. By that metric, 2018 was already on track to deliver the lowest share of positive returns across 17 asset classes since 2008, according to Morgan Stanley data last month."
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