The implication? This expansion may have a little longer to run, since wage hikes aren’t yet sharp enough to spur the Fed to aggressive tightening. But eventually all those labor shortage data points will coalesce into an inflationary picture, as employers discover that their choice is between lower margins and extinction. Full Story
The comptroller's reply, signed by the deputy comptroller for public affairs, Bryan Hubbard, said only that the comptroller's office has "dedicated examiners" at the largest banks who "continuously evaluate the credit, market, operational, reputation, and compliance risks of bank trading and derivative activities." Full Story
The mega-cap stocks that dominate the US markets are just finishing another monster earnings season. It wasn’t just profits that soared under Republicans’ big corporate tax cuts, but sales surged too. That’s no mean feat for massive mature companies, but sustained growth at this torrid pace is impossible. So peak-earnings fears continue to mount while valuations shoot even higher into dangerous bubble territory. Full Story
This has many in panic, thinking gold will go lower than the 2016 bottom (the wall of worry). This is typical of major bottoming patterns, especially gold. Price will get back in the triangle and eventually breakout higher. Full Story
Let me point out here as a reminder, whatever complaints the Trump administration may have about trade with China it should theoretically settle those disputes through the legal mechanisms of the World Trade Organization. If the US thinks it has a case against unfair Chinese practices then it should trust the multilateral trading authority, otherwise, as history has shown, it’s a recipe for international chaos and a slippery slope to conflict. Frankly, it potentially leaves the US looking like it has contempt for multilateralism with its "bullying" manner of high-handed unilateralism. Full Story
As the world-wide population has grown, much concern has been building regarding how we will be able to continually feed this ever-growing population. Since there are only so many resources available, many scientists question our ability to produce enough food to be able to sustain our population. Full Story
The "Codes and Conspiracies" program series on AHC-TV this week rebroadcast throughout the United States its program on gold from two years ago, the first and last parts of which give your secretary/treasurer extensive time to challenge the U.S. government's surreptitious interference in the gold market. Those parts are wrapped around an interesting if a bit incongruous examination of Nazi Germany's expropriation of gold to sustain itself during World War II. Full Story
In just the past few years, global asset values have risen to the biggest bubbles in history. Unfortunately, this doesn’t seem to be a concern to the market because most people believe they are getting richer. However, rapidly rising digital riches can easily turn into digital losses, just as quickly. But, this will likely remain a secret until the major fireworks begin in the markets by the this fall or within the next 1-2 years. Full Story
One of the biggest stories since the last edition of the Market Overview, is inflation reaching the Fed’s 2-percent target. As we analyzed in the Gold News Monitor, The latest report on the Personal Income and Outlays revealed that the annual rate of the PCE Price Index rose 2.3 percent, while the core inflation hit 2 percent, the Fed’s target, for the first time since April 2012. Full Story
Amazingly, all it will take for this price explosion scenario to unfold is for JPMorgan not to add aggressively to short positions when the inevitable rally begins. You heard me right – the silver price explosion to $50 and beyond, along with a commensurate move in gold is only contingent on JPMorgan doing nothing on the next rally. Admittedly, JPMorgan has been in many similar set ups in the past and has always added aggressively to its COMEX short positions, eventually capping those rallies. This has prompted many to assume that JPMorgan will always sell short aggressively on future rallies. But the current set up has never favored JPMorgan this much. If what JPMorgan has always done holds true again we will get a rally of some significance anyway, just not the big one. But if JPMorgan doesn’t add to short positions on the next rally, the third run to $50 silver and beyond should be at hand. Full Story
Should gold prices be higher by more than a factor of ten because the value of Fort Knox gold is tiny compared to interest expenditures and debt? Should the government sell the remaining gold and close the Fort Knox Bullion Depository because the value of the gold in Fort Knox is tiny compared to government expenses and official national debt? Full Story
Why did the BoE hike? Well, the UK survived the post-Brexit referendum turmoil. The inflation is above 2 percent, while unemployment is low, as one can see in the charts below. With very tight labor market and rising wages, the policymakers could be afraid of the overheating of the economy, even with the uncertainty about Brexit. Full Story
There is nothing bullish happening on the gold and silver charts. Nothing bullish on the miner Index/ETF charts. Nothing bullish on the HUI/Gold ratio. In other words, when it comes to a segment as volatile and sentiment-dependent as the precious metals, we are in the kill zone. That can be read a couple of different ways. First, the inflationist gold bugs are getting exterminated as the US dollar first rose and since has stubbornly refused to take a pullback. Full Story
As part of Merk's in-house research we regularly evaluate a consistent set of charts covering the economy, equities, fixed income, commodities and currencies. The aim is to keep our eyes open and to look through the noise of the headlines, avoiding the distractions of sensationalized click-bait. In sharing this content, we offer a cross-check to your own thinking and aim to add value to your own process. Full Story
The BIS' July Statement of Account gives summary information on its use of gold swaps and gold-related derivatives in the month. The information is not sufficient to calculate a precise amount of gold-related derivatives, including swaps, but the bank's total estimated exposure as of July 31 was about 485 tonnes of gold versus about 413 tonnes as of June 30. Full Story
Something took place in the gold industry that I thought would never happen. In a stunning press release, Franco-Nevada Gold announced that it was taking a financial stake in U.S. shale energy assets. Why on earth is one of the top gold royalty companies investing in an industry in which it has no expertise… especially in the shale oil industry?? Full Story
Morgan Stanley CEO Jamie Dimon recently raised his forecast for rates on the Ten-Year Note, currently trading just below 3%, to 5%. He’d predicted a rally to 4% back in May but now thinks the bull market in stocks could run for another two or three years, putting additional upward pressure on long-term yields. For its part, Rick’s Picks has told subscribers to expect a push soon above the 3.11% peak recorded back in May — a peak we had foreseen five months earlier when the Ten-Year Note was paying around 2.35%. Full Story
We’re getting there. Inch by inch, we’re moving closer to the tipping point of the decline when the slow, regular, and somewhat boring move lower turns into a violent drop. Yesterday’s session was still in line with the less exciting manner of declining, but we saw another crack in the dam that’s still somewhat holding the prices at the current levels. It doesn’t seem that it’s going to last for long. Are you prepared? Full Story
First, notice that the current decline has been ongoing for nearly four months, and it has followed a uniformity that is rarely seen in a randomly-derived and "free" market. On the second chart, the value of the yuan versus the dollar is represented in candlesticks, and it is overlaid with the price of COMEX gold, which is shown as a solid blue line. Full Story
There’s a saying in the trading world: professionals buy pullbacks and sell rallies, while novices buy breakouts and sell breakdowns. Mike Matousek, head trader at U.S. Global Investors, discusses this idea and applies it to the gold price, which is resting near the midpoint of the five-year range. Through a series of charts, Mike shows the current gold price trend and explains what it means for both short- and long-term traders. Full Story
The precious metals sector is on a long-term buy signal. Short term is on sell signals. The cycle is down. From a contrarian point of view, the current extreme bearish sentiment is an excellent buying opportunity for long-term investors. We are holding gold-related ETFs for long-term gain. Full Story
By: Trey Reik and Maurice Jackson - 7 August, 2018
Trey Reik, senior portfolio manager with Sprott USA, speaks with Maurice Jackson of Proven and Probable about the Fed's recent actions and what effect they are having on the gold and other markets. Full Story
Simply put, I’ve identified the $23 - $18 price zone for GDX in 2018 as the most important buying area in the history of markets. I stand by that call, and I’m taking buy-side action right now at about $21, which itself is the “meat and potatoes” area of the entire $23 -$18 zone! Full Story
During a recent episode of the popular “At the Bar with Brent Cook and Mickey Fulp” video series, our host Kelly Earle briefly mentioned a long-lived truism practiced by real economic geologists: “Drill it to kill it”. Her interjection got me to thinking about the junior resource sector and how drastically our business has changed since it emerged from the post-Bre X debacle in mid-2003. The thought process led me to ask the unholy trinity of me, myself, and I a pointed question: What the hell ever happened to “drill to kill”? Full Story
This is yet another confirmation that we’re not nearly as rich as we think we are. If your home is your biggest asset but a big part of your equity is secretly claimed by the local government, you don’t really own it. And if you’re counting on a public sector pension and home equity to finance your retirement you might be hit with a double whammy when your pension is cut (despite what the state constitution says, it will be cut one way or another) at the same time your property tax bill soars to protect what’s left of pension benefits. Full Story
Last month in Venezuela’s capital city of Caracas, a cup of coffee would have set you back 2 million bolivars. That’s up from only 2,300 bolivars 12 months ago, meaning the price of a cup of joe has jumped nearly 87,000 percent, according to Bloomberg’s Café Con Leche Index. And you thought Starbucks was expensive. Full Story
Shifting to the October contract yields a compelling downside target at 1197.70 that can replace a projected range of 1192.70-1201.10 given here earlier for the August futures. As always, I’ll recommend bottom-fishing this Hidden Pivot support aggressively only to subscribers who have made money being short on the way down. Full Story
U.S. nonfarm payrolls slow downed in July. The economy added only 157,000 jobs last month, while MarketWatch had expected 195,000. The gains were widespread – however, job creation was the strongest in professional and business services (+51,000), leisure and hospitability (+40,000), and manufacturing (+37,000). Interestingly, government, financial activities, mining, utilities, and transportation and warehousing combined cut about 26,000 jobs. Full Story
Gold has had a rather hard time of it during the past several months, as we can see on its latest 1-year below, but its drop has been proportionate to the rally in the dollar, and is therefore unremarkable. What this drop has achieved, which is a useful precursor to a recovery, is to finally flush out the Large Specs, who, after outstaying their welcome, have finally packed their bags and left. This we can see on the latest COT chart which is stacked right below gold’s 1-year chart for direct comparison. Full Story
The best performing metal this week was platinum, down just 0.04 percent as Impala Platinum announced it would need to slash 13,000 jobs in a restructuring move aimed at boosting income. Although gold is headed for a fourth weekly loss, the gold price rose on Friday after hitting its lowest in over a year when the U.S. Labor Department reported that total nonfarm payroll growth missed expectations. Full Story
Arch Crawford, head of Crawford Perspectives for 41 consecutive years, outlines his technical perspective on the global financial markets. Regarding the gold market, our guest views $1,200 gold as solid support, which must hold if the bull trend is return with gusto. Peter Eliades of Stockmarket Cycles, returns with technical insights on the financial markets. His cycles work agrees with that of Arch Crawford, a significant stock market peak may be in place. Full Story
China’s “project of the century” is what is being called “the Belt and Road Initiative (BRI). It is known as the revival of the ancient “silk road” that traversed Eurasia and seas between China and Africa. The ancient “silk road” had its start in the Han Dynasty (207 BCE–220 CE) and lasted into the 15th century. It played a significant role in the development of numerous civilizations including China, Korea, Japan, the Indian subcontinent, Persia (Iran), Europe, the Horn of Africa, and Arabia. One could even say it was first globalization. Full Story
Explaining a new paradigm can be both simple and impossible at the same time. For example, Copernicus taught that the other planets and Sun do not revolve around the Earth. He said that all the planets revolve around the Sun, including Earth. It isn’t hard to say, and it isn’t especially hard to grasp. Full Story
On Thursday, the HUI index just broke below the December 2016 lows (in terms of daily closing prices), but it reversed on Friday and closed the week back above this important support. Invalidations are often more important than breakdowns, so did Friday’s action just tell us that we’re going to see a major reversal? Full Story
The past few months have added some cred to the “sell in May and go away” rule of thumb for precious metals, as gold’s price action has been both boring and depressing. It’s now close to its 12-month low, while a lot of miners are providing material for the old joke: “Want to make a small fortune in gold mining stocks? Start with a large fortune…” Full Story
The U.S. Government is going to surpass another significant milestone this year. According to the recently released data from the TreasuryDirect.gov, the government will fork out a stunning half trillion dollars just to service its debt in 2018. Unfortunately, as U.S. interest rates rise, along with ever-expanding public debt, the cost to service the debt will continue to increase. Full Story
This week I have something special for you: an update of “The Distribution of Pain,” one of 2017’s most popular letters. I say “popular” just in terms of feedback and reprint requests. It was thought-provoking but also sobering. I started with the original version, re-edited to clarify a few points, and added some new comments. It is still a timely, important topic. Full Story
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