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May 08 2019

moneymetals

Russia & China Intend to Drain the West of Its Gold

Precious metals markets got hit this week as the Federal Reserve threw cold water on the idea of interest rate cuts.

Fed policy makers met on Wednesday and left their benchmark rate unchanged as expected. The Fed’s statement noted that price inflation excluding food and energy has declined over the past 12 months and is officially running below 2%. This, even as oil and gasoline prices have trended sharply higher this year.

Fed chairman Jerome Powell described the below-target official inflation number as “transitory.” He indicated he expects inflation to return to target at 2% without more central bank stimulus.

Powell’s comments disappointed investors who were hoping for a rate cut later this year. Equity markets joined metals markets in selling off.

For the week, gold prices are down 0.3% and currently come in at $1,283 an ounce. Silver is posting a weekly decline of 1.0% as spot prices trade at $14.98. Although they are bouncing back a little bit here today both gold and silver are at risk of closing out the week below some significant support levels, which could bode poorly for the near term outlook.

Platinum’s recent run higher got dealt a huge setback this week, with prices dropping $30 an ounce or 3.3% to now trade at $872 per ounce. And finally, palladium is also getting hit hard, down 4.3% since last Friday to trade at $1,372 as of this Friday morning recording.

Market volatility around FOMC meetings is to be expected. Unfortunately, traders still key heavily off the policies and pronouncements of central planners. To what extent central planners intervene directly in markets has long been a concern of sound money advocates.

The Gold Anti-Trust Action Committee, also known as GATA, has assembled massive amounts of circumstantial evidence of manipulation in the precious metals markets. Sometimes the evidence is clear cut – as when traders at major banks are found guilty of cheating the system. In other cases, there are dots yet to be connected.

The Federal Reserve is notoriously secretive, and the Treasury Department is also tight lipped about how and when it intervenes in markets. Those of us who think it’s important to shed light on these activities have very few allies in Congress.

One is Representative Alex Mooney, a Republican of West Virginia. Chris Powell of GATA recently appeared on USA Watchdog to give an update on some of Representative Mooney’s efforts.

Continue reading: https://bit.ly/2VPVOrr

April 30 2019

moneymetals

Silver Market Alert: Powerful Bullish Setup Takes Shape

silver-market-alert-bullish-setup-social.jpg

The silver market appears to be setting up for a big move.

After spending this spring stair-stepping lower in a narrowing range, silver prices have formed a falling wedge pattern. That pattern usually resolves in a powerful directional breakout. The good news for bulls is that falling wedges usually break out to the upside.

Silver price (chart) - april 29, 2019

Commercial hedgers and bullion banks (i.e., “smart money”) in the silver futures market have significantly trimmed their short positions over the past couple weeks – a bullish development. While their net positioning isn’t yet at an extreme, it is more favorable than not for a price rally to commence in the near future.

Of course, neither futures traders nor chart patterns are 100% reliable. Nor do they have any particular implications for where prices may be headed years from now.

Long-term investors can benefit from identifying opportune entry points on the charts. But if a big multi-year bull market is to come, it will be driven by fundamentals – supply, demand, relative valuations, inflation rates, and investor sentiment.

Let’s therefore drill down into silver’s fundamentals.

The Silver Institute is widely considered to be an authoritative source. The Institute released its annual World Silver Survey in April, which showed global silver demand rose by 4% in 2018 to more than 1 billion ounces. At the same time, supply from mine production fell 2% last year to 855.7 million ounces.

At first glance, these numbers present a compelling case for higher silver prices. Demand appears to be outstripping supply.

However, there is no actual physical shortage. The mining supply deficit is (for now) being made up by scrap recycling and other secondary above-ground sources of physical silver.

There ultimately will be a physical shortage if demand continues to rise while mining production falls. The market’s way of averting such a shortage is through higher prices to incentivize more output and encourage thrifting by industrial users.

Silver is a difficult market to forecast in part because there are few primary silver miners in existence. Most silver production comes from gold and base metals mining operations.

Continue reading: https://bit.ly/2VCFD0E

March 04 2019

moneymetals

Central Banks Now Buying Gold Like Crazy

Well now, for more on how the mainstream media is seldom giving you the full story, plus much more, let’s get right to this week’s exclusive interview.

Gerald celente

Mike Gleason: It is my privilege now to welcome in Gerald Celente, publisher of the renowned Trends Journal. Mr. Celente is perhaps most well-known trends forecaster in the world and it's always a joy to speak with him.

Mr. Celente, thanks for the time again today and welcome back.

Gerald Celente: Oh, thanks for having me on, Mike.

Mike Gleason: Well, Gerald, the Trends Journal is forecasting Economic 9/11 as one of the big trends for 2019. There are plenty of indicators which just support your thesis for a major slowdown. Debt levels – both public and private – have exploded, China is slowing down and all the stimulus in Europe has failed to generate results there. Higher interest rates are hurting, everything from real estate to auto sales, et cetera. But none of this is reflected in the stock markets, which are roaring higher. Once again, it looks like the Fed is up to its old tricks, promising to stop the rate hikes they had planned and end the program for selling bonds. The constant intervention of the Fed has always been one of the major wildcards when trying to predict where things are headed in recent years. What do you think? Can the central bankers kick the can one more time to avoid a recession, or are they finally going to lose control in the months ahead?

Gerald Celente: Well, I think you've summed everything up pretty well in analyzing it, and the general situation. When we made that forecast of an Economic 9/11, remember how trends for the new year go out in December. In December, we just saw the Dow have its worst month since the Great Depression, and all of a sudden on January 4th, 2019 it all turned around. What happened was the Federal Reserve Chairman bent over to Trump, and he backtracked on his aggressive stance of 2018, where they raised interest rates four times and they were scheduled to raise them three to four more times in 2019. He said he would be patient. In late January, they said it again that they would be patient. They were in no hurry raising interest rates. That changed our forecast, because what they've done is they've injected more monetary methadone into the bull to keep it running. You can see what was happening when they were going to pull the needle out.

The bull was dying, it was OD’ing already, and now they just got it going once again. And you mentioned wildcard, and that's exactly why nobody could predict the future. There are too many wildcards, whether they're man made, or made by Mother Nature. Well, of course now I have to be proper and politically correct, whether women-made or made by father nature. What happened was they played the wildcard, and the fact is whether it was fear of a fed audit, or just pressure from Trump, we listed all the times he called the Fed loco and crazy, and how disgusted he was with them throughout 2018, beginning in July, until they did a backtrack. So, now what we're looking at, Mike, it's the presidential reality show’s already heating up and Trump is going to do everything he can to keep the economy pumping along, or I should say Trumping along.

Remember, the cat’s in the real estate business. To his son in law, the family, the Cushners. It's real estate. You mentioned about real estate prices going down. I mean what happened in December, we saw southern California home sales plunge 20% in December to the lowest pace in 11 years. So, when those interest rates got around 5% for a 30-year mortgage, you could see the big reversal. Not only do we see the Fed not raising interest rates in 2019, we could see them aggressively bringing them down, if the economy starts to slow down. They raised them nine times since 2015, they could lower them nine times.

Full podcast: https://goo.gl/6usfQV

February 19 2019

moneymetals

Gold & Silver Prices Firm Despite Dollar, Stock Market Strength

Silver has fallen about $.45/oz from the early January highs, and gold has lost around $9/oz. Frankly, price action could be a lot worse.

During that time, the Federal Reserve Note dollar rallied and the equity markets roared higher. That combination should be bad news for gold and silver markets, but the premier precious metals have held onto most of their recent gains.

Perhaps the metals markets are seeing past the rally in the dollar. There isn’t much to support that move higher, after all. The Fed recently signaled a dramatic about face on monetary policy.

Inflation of the dollar

Two months ago, tighter monetary policy was a near certainty. Now, central bank officials are publicly putting the brakes on rate hikes and “Quantitative Tightening” – the program of steady selling from the massive hoard of bonds accumulated during the years of Quantitative Easing.

Recent inflation data (flawed as it may be) shows consumer and producer prices below the central bank’s target. The equity markets clearly can’t tolerate much more tightening given the stock market carnage last Fall.

The Trump Administration was none too happy about rising interest rates and the stronger dollar before stocks began selling off. More recently, Trump officials ramped up pressure on the Fed to change course. The Fed is now cooperating.

Why currency traders are currently bidding up the U.S. dollar is a mystery. It doesn’t look like a sustainable move to us, given the people who manage its value are aiming lower.

Full Article: https://goo.gl/fXYLEa

February 15 2019

moneymetals

February 05 2019

moneymetals

January 31 2019

moneymetals

Peak Gold and the Coming Supply Crunch

peak-gold-supply-crunch-social.jpg

During the lackluster and otherwise unremarkable trading of 2018, a hugely important development took place in the precious metals markets. Gold production, in the estimation of some top industry insiders, peaked.

Peak gold represents the point at which the total number of ounces being pulled out of the ground by miners reaches a maximum.

It doesn’t necessarily mean gold production will suffer a precipitous fall. But it does mean the mining industry lacks the capacity to ramp up production in order to meet rising global demand and even higher prices would not make it happen.

One of the leading proponents of the peak gold thesis is Ian Telfer, chairman of Goldcorp (which was recently acquired by Newmont Mining to become the world’s biggest gold company).

Telfer remarked in 2018, “In my life, gold produced from mines has gone up pretty steadily for 40 years. Well, either this year it starts to go down, or next year it starts to go down, or it’s already going down… We’re right at peak gold here.”

We’ll soon find out whether his call for gold production to fall in 2019 pans out. If it does, the implications for precious metals investors are enormous.

The concept of peak gold is controversial, to be sure.

Skeptics point to the thwarting of peak oil over the past decade. Just as technological breakthroughs in fracking and horizontal drilling caused an unexpected surge in crude oil supplies, could not advances in gold mining techniques also lead to an unforeseen supply surge?

When human ingenuity combines with the right market incentives, nothing can be ruled out. But unlike crude oil which is a byproduct of decayed living organisms and exists in various grades all over the world, gold is a basic element that came to us from exploding stars billions of years ago.

Top 5 gold miners production 2017 vs 2018

The amount of gold in earth’s crust is fixed. By contrast, oil and other hydrocarbons can be produced synthetically from renewable biomass.

Perhaps one day we’ll mine for gold in space or generate it in nuclear reactors or particle accelerators. Theoretically, it’s possible. Practically, there’s no prospect of these unconventional methods of boosting earth’s gold reserves becoming economically viable in our lifetimes. It would take a true “moon shot” in the gold price and/or a technological breakthrough that might be decades away from coming to fruition.

In the meantime, the gold mining industry is experiencing a major wave of consolidation.

Last year Barrick Gold and Randgold merged. This year Newmont Mining acquired Goldcorp. Many lesser known junior mining and exploration companies have been or may soon be gobbled up by senior producers looking for an economical way to grow their reserves.

Developing new mines is expensive, time consuming, and risky.

Continue reading: https://goo.gl/siinuz

November 07 2018

moneymetals

Post-Election Run Down: Biggest Winner, Biggest Loser

Tuesday's elections produced some winners, some losers, some surprises, and some lingering uncertainties.

For investors, the potential for a major shock to the markets was averted. But with Democrats poised to take control of Congress, new legislative threats to wealth holders loom on the horizon.

Even though the GOP lost the House of Representatives, it gained seats in the Senate – a rare feat during a mid-term election for a party that controls the White House. President Donald Trump hailed the night a “tremendous success.”

Biggest Winner: President Trump

Donald trumpIn more ways than one, President Trump emerged as a big winner on election night. He campaigned aggressively for several Senate candidates in states he had won in 2016. Thanks in no small part to his ability to energize the GOP base, a few races that had been widely thought to favor Democrat incumbents flipped to Republicans.

Trump-backed GOP candidates unseated Democrats in North Dakota, Indiana, Missouri, and Florida. Rick Scott’s narrow victory over a three-term incumbent in the Sunshine State was one of the more surprising and electorally important outcomes.

The perennially “too close to call” state of Florida once again lived up to its reputation as Republicans picked up the Senate seat and the governorship by less than 1-point margins each. Looking ahead to 2020, the newly elected Republican governor and Senator can be expected to serve as assets on the campaign trail in helping Trump win the state’s critical electoral votes.

At the end of the night, Trump didn’t put all of his endorsed candidates over the top. His party DID lose control of the House.

That’s not necessarily a bad outcome for Trump politically.

Full Article here: https://goo.gl/CGYZhc

November 06 2018

moneymetals

Sadly, Sound Money ISN’T on the Ballot

Americans will be headed to the polls to cast ballots in the midterm elections. Polling suggests that Democrats will return to power in the House of Representatives. Republicans are favored to hold on to the Senate.

However, political polls have proven less than reliable. There are plenty of people expecting a surprise once the votes are counted.

But there are many policies that won’t change regardless of who holds Congressional power come Wednesday.

U.S. debt bubble

For starters, we can count on the continuation of huge deficits. The Treasury Department’s most recent estimate is that government borrowing will double in 2018 versus last year. The bureaucracy is going to blow through $1.34 trillion more than this year’s record tax revenue.

That deficit will be the highest since 2010, back when the U.S. economy was mired in deep recession. Today, the IRS stands in high cotton. Imagine what deficit would look like if tax receipts were at recessionary levels and/or Congress was launching a major stimulus program.

The best-case scenario for deficit hawks would be a Republican victory in tomorrow’s election (although an argument could be made that a splitting of power between the two chambers would result in somewhat of a stalemate in Washington, possibly meaning less expansion of governmental programs).

Unfortunately, the “best case” is not all that good. Big government Republicans are already in control of Congress, and even the President’s supporters admit Donald Trump is not conservative when it comes to borrowing and spending.

Full Article: https://goo.gl/2FGBS8

November 02 2018

moneymetals

Chris Martenson Warns: Markets Are Making Faulty Assumptions about Growth & Resources

Chris martenson

Well now, without further delay, let’s get right to this week’s exclusive interview.

Mike Gleason: It is my privilege now to welcome in Dr. Chris Martenson of PeakProsperity.com, and author of the book Prosper! How to Prepare for the Future and Create a World Worth Inheriting. Chris is a commentator on a range of important topics such as global economics, financial markets, governmental policy, precious metals and the importance of preparedness among other things. And it's always great to have him with us.

Chris, it's been too long, but welcome back and thanks for joining us again.

Chris Martenson: Hey Mike. Thank you so much. It's great to be back with you.

Mike Gleason: Well Chris, we continue to follow your work closely, and your Crash Course video remains in our opinion, a must watch for people who are concerned about the road we are all on. You have summarized the problems we face as “expecting infinite growth in an infinite world.” No amount of money printing and Wall Street wizardry can change the fact that resources and energy in particular are limited. Unfortunately people are not always ready to listen, lots of folks tuned in following the 2008 financial crisis, but years have passed, and many Americans have forgotten about those darker times. Home prices and stock prices have been rising and few people are worried, at least with regards to the markets.

It isn't fashionable to be preaching caution, but the need for it is, we think, greater than ever. What are you saying to people who might think 2008 was just another bump in the road and now is not the time to be bearish, Chris?

Chris Martenson: Well, they have a point. They've got 10 years under their belt of the most expansive monetary policy ever, and I got dinged because I saw a lot of bearishness in 2011, and called it at the time, and of course, things just bottomed a little bit and then went up. Same thing in 2016, beautiful head and shoulders top, there was emerging market trouble everywhere, bonds were exploding overseas, and the dollar was spiking, as carry trades unwound, called that too, said, "Uh oh, this looks bad" and then was 50-degree rocket ride of monthly gains on U.S. equities after that.

Well, now we have the data, Mike. We look back, we say, "Oh, the central banks just printed more, then even more, and then even more." Most people mistakenly think the crisis was in 2008, they did a few extraordinary things on the fiscal side, they had TARP on the monetary side, there was all this quantitative easing, and then that's in the rear view.

But the truth is, the largest ever amount of printing happened in 2015, '16, and '17. Those in '16 and '17 in particular. Those were the years. If you want to understand why things denominated in freshly printed money go up in price, you don't need a PhD in economics. It's just how it works. And the central banks printed like crazy, tens of trillions, shoved it into the markets and guess what happened? Exactly what we predicted in the Crash Course in 2008.​...

Continue reading: https://goo.gl/47gwK4​

October 19 2018

moneymetals
moneymetals

October 09 2018

moneymetals

Frank Holmes: Here’s Why Gold Stocks, Gold, and Silver Are Great Buys Now

Well now, without further delay, let’s get right to this week’s exclusive interview.

Frank holmes

Mike Gleason: It is my privilege now to welcome in Frank Holmes, CEO and Chief Investment Officer at U.S. Global Investors. Mr. Holmes has received various honors over the years, including being named America's Best Fund Manager by the Mining Journal. He is also the co-author of the book The Gold Watcher: Demystifying Gold Investing, and is a regular guest on CNBC, Bloomberg, Fox Business, as well as right here on the Money Metals podcast.

Frank, welcome back and thanks for joining us again.

Frank Holmes: It's great to be with you.

Mike Gleason: Frank, it seems like escalating tariffs and trade tensions have been the major topic on Wall Street since early last spring. We continue to be a bit baffled by the market's reaction, however. The President has gone from posturing to serious action with another $200 billion imposed on China a couple of weeks ago. The equity markets aren't particularly fazed near as we can tell. It is yet to move the needle on the trade deficit at all, though it is still early, but it is starting to show up in prices. We've been buying heavy duty racks for our storage vault over the past few months, for instance, and on a recent batch which we just ordered yesterday, the price rose some 10% from what they just were a couple of months ago, and the reason we were given was that the manufacturer is having to pay more for imported steel. You've called these tariffs a tax, Frank, and that's exactly what it is. Do you think the rest of America will notice much higher prices any time soon?

Frank Holmes: Well, I think that the tariffs or the trade war is able to do what it is doing short-term because of the fiscal stimulus that took place last year with tax reform, and I think that that's why the market hasn't capitulated. Profits are still strong. We had a big run in small cap stocks, predominantly domestic stocks, and a small handful of big cap like Amazon in the markets, but there's no doubt that the trade and tariff war is going to impact… and we see it on steel prices such as if you're building a contemporary modern home today, you have to use more steel for the open space, and those prices, steel prices are up 35%. So you start to run these numbers through and you're seeing price inflation is going to come now with Amazon at going to $15 an hour, you're going to see the CPI number ticking up. That's what I really believe. If we also looked at the 1980 numbers and later on numbers for CPI calculations, inflation's running at 10%, so when they say it's 2.4 or 2.7, I find that really difficult (to believe).

I noticed in San Antonio, our avocados used to always come from Mexico and no longer, and the prices are up and the quality is down. So, I do see that there's some issues on this trade war, but I don't think it's over, the trade war. And I think it's going to get worse because there's a real strategy against China. In the renegotiated NAFTA agreement, which is over 1000 pages, there are some policy decisions there that Canada and Mexico cannot go into a special pact with China, otherwise that whole agreement is thrown out the door. And same thing with South Korea, Mexico, Japan, there's a real push by the administration to go after China. Now the positive part is that Trump and his administration want to have zero tariffs everywhere and let the best athlete win. And the issues with China is that they are double standards and lots of protectionism. So, that battle is not over. There is also the big concern that China is trying to undermine the currency and have an alternative currency and that is something that Mnuchin and Trump are very concerned about.

You wouldn't normally think when you have such a high interest rate differential. Today we're seeing two-year, five-year, ten-year government bonds all about the CPI number that's reported and when you look and compare to Japan at ten beeps for ten-year money versus 3.8. Germany, Europe is 60 basis points, there's something not right there and normally the dollar would actually be much, much higher. Gold would be under $1,000 and the fact that it's not is very constructive for the price of gold because any rollover in the dollar, in a slow down this economic engine, which I think is going to happen next quarter. By the end of this quarter we're going to get into what's called rebalancing our portfolios and I think that we're going to have some real issues there.

Continue reading: https://goo.gl/9JGxc9

October 02 2018

moneymetals

U.S. Mint Silver Eagle Sales Spike By Another 1 Million At End Of September

us-mint-silver-eagle-sales-spike-by-another-1-million-at-end-of-september.jpg

Demand for the U.S. Mint Silver Eagles spiked again at the end of the September pushing sales nearly to three million. In a little more than a week, Silver Eagle sales jumped from 1.9 million to 2.9 million, nearly doubling from the previous month. Sales of Silver Eagles in August were only 1.5 million versus 2.9 million in September.

As I mentioned in my previous update, the U.S. Mint temporarily halted sales of Silver Eagles at the beginning of September due to a spike in demand. However, as the U.S. Mint resumed sales, the Authorized purchasers have been taking advantage of the low price.

Let’s look at my Silver Eagle chart from September 19th:

Silver eagle sales march-september 2018

As we can see, Silver Eagle sales bottomed in May at 380,000, and have continued to rise over the next four months. Now, if we look at the U.S. Mint’s most recent update, sales have jumped by nearly 1 million to 2.9 million:

US mint silver eagle sales september 2018

If we exclude sales in January (2017 & 2018), which are normally elevated due to the new annual release of the Silver Eagle, the last highest month was in November 2016 at 3,061,000. So, we can see that demand hasn’t been this robust in nearly two years.

Continue reading: https://goo.gl/7fEC4H

September 26 2018

moneymetals

Download Your Free Copy of 
Money Metals Insider NOW! (Fall 2018)

More freebies for you!



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Money metals insider fall 2018

One big development is legislation Money Metals has helped bring forward in Congress that, if passed, would end the improper taxation of the monetary metals.

Your free Money Metals Insider newsletter also updates you on Trump's dispute with the Fed, the retail precious metals market, reader questions about bitcoin, platinum, and the gold:silver ratio, and much more.

Of course, not only does Money Metals offer super competitive pricing when you want to buy, but also we are without a doubt the #1 place in the country to SELL your precious metals as well.

Here are the highlights from your free Money Metals Insider newsletter:

So download the PDF of this fantastic free newsletter right now – and pass it around to your friends! It's another free benefit for those who have signed up for the Money Metals email list.

Source: https://goo.gl/SRnPeX

September 25 2018

moneymetals

Central Bank Gold Purchases Now Control 10% Of The Total Market

central-bank-gold-purchases-social.jpg

Central Banks have become big players in the gold market and now control 10% of the total market demand. Now, this wasn’t always the case. Just ten years ago, the Central Banks were main suppliers via their policy of dumping gold into the market. However, the Central Bank strategy to sell gold into the market to depress the price, had quite the opposite effect.

For example, Central Banks dumped over 2,600 metric tons of gold into the market between 2003 and 2007, according to data from the World Gold Council. So, what kind of impact on price did the sale of 84 million oz of Central Bank gold have on the market during that period? The price of gold nearly doubled from $363 in 2003 to $695 in 2007.

Central banks gold

The last year Central Banks sold gold into the market was in 2009. However, it was only 34 metric tons. Since 2010, Central Banks have been net purchases of gold. Between 2010 and 2017, Central Banks purchased nearly 3,700 metric tons (mt) or a stunning 119​ ​million oz of gold.

And Central Bank gold purchases don’t seem to be slowing. The World Gold Council (WGC) just released yesterday in their Market Update: Central bank buying activity, that official gold purchases are now 10% of the total market.

Using data from the WGC Demand Trends, Central Banks purchased 193 mt of gold in the first half of 2018, representing 10% of the total global demand:

Central bank gold purchases vs. total demand (1h 2018)

The majority of the official gold purchases during the 1H of 2018 came from Russia, Turkey, and Kazakhstan. Now, what a difference than just a little more than a decade ago when Central Banks were selling rather than buying gold.

Continue reading: https://goo.gl/hfYhqE

September 21 2018

moneymetals

Oil Prices, War Fears, and Rising Inflation All Point to Gold Strength Audio Player

Well now, without further delay, let’s hear this week’s exclusive interview with the man who famously advises people to have always have guns, gold and a getaway plan.

Gerald celente

Mike Gleason: It is my privilege now to welcome in Gerald Celente, publisher of the renowned Trends Journal. Mr. Celente is perhaps most well-known Trends forecaster in the world, and it's always great to have him on with us.

Gerald, thanks for the time again today, and welcome back.

Gerald Celente: Oh, thanks for having me on, Mike.

Mike Gleason: Well Gerald, one of the hot topics in the markets today is the escalating trade tensions. Trump just announced another $200 billion in tariffs on China and he looks ready to more than double that if the Chinese should retaliate. The President is confident the U.S. can win a trade war. Do you share that optimism? How do you see this playing out?

Gerald Celente: I absolutely share that. Because I mean, here's the deal. If your or I were to do business and I'm making $350 billion more than you are, are you going to want to renegotiate this? Hey listen, something's wrong over here. So, when you look at even with the tariffs that Trump is putting on, that still amounts to a very small percentage of China's GDP, about 0.3%, or something like that, 5%, 6% tops. So China's going to negotiate. They're not going to give up a very lucrative business deal, so they could keep making more when the other business partner wants a better share.

Mike Gleason: And how do you see the escalating tariffs impacting markets? So far the response appears mixed. The dollar seems to be benefiting, and metals are suffering. We aren't sure the markets have it right when it comes to the dollar though. It seems to us that tariffs should drive price inflation. Either Americans pay a higher price for the imported goods, or replace them with more expensive domestic products. And the Chinese aren't likely to be buying as many dollars or treasuries if exports to the U.S. fall – to say nothing of their ability to wage and all-out currency war against the dollar. But so far, at least the dollar is getting stronger in foreign exchange markets. What are we missing?

Gerald Celente: Well, I think what people are missing is they're making too much of a deal of the trade war. It's every day. It's almost become stupidity with the business media. Every day they're going, “the market goes up because trade wars eased. The market’s down because trade fear is increased.” I mean, come on. What are they kidding? I mean, the world is bigger than that. Even what you saw car sales start slumping in China, the headlines blamed the trade wars. Does the average person give a damn about a trade war? They're buying what they're buying, they got what they got. If they don't have it, they don't spend it. If they have it, they spend it. They don't know what's going on behind the scenes and the details of a trade war. The media has dumbed down so much… it's every day. It's one excuse. And as far as the dollar going up, it's interest rates.

I mean, the United States is raising interest rates. You're looking at what, even with the United States raising interest rates, what are you looking at the overnight, the Fed funds rate? 1.75 to two? And what is it 1.5 in Canada and the U.K. Negative interest rates in Europe and the European Union. Negative in Denmark. Negative in Sweden. Negative in Japan. I mean, it's ridiculous. So what I'm saying, Mike is that the markets cannot take a rate increase. That's why the currencies are going down. And matter of fact, we just heard from the number two guy in China, Lee, saying that to think that the Chinese, he said, want to devalue our currency is ridiculous. He said we're not going to make up that much more trade on having our currency decline. Because by the same token, you look at China, what are they the largest importer of energy in the world? And now the Yuan is going down, and oil prices are going up. Oh, and what are oil prices based on? Petrodollars. So now as their currency declines, they got to input more energy. And it's based in dollars, as the dollar gets stronger, they don't want this to happen.

So to me it's a lot of misinformation out there. And again, I'm no Trump fan. I mean, I think the guy is ridiculous on a lot of stuff. But the media is so anti Trump that they'll keep using one play a day, and overlooking the bigger story.

Full Podcast here: https://goo.gl/9oqzzB

September 19 2018

moneymetals

Trump’s Backdoor Power Play to Rein In the Fed

“Just run the presses – print money.”

That’s what President Donald Trump supposedly instructed his former chief economic adviser Gary Cohn to do in response to the budget deficit. The quote appears in Bob Woodward’s controversial book Fear: Trump in the White House.

Trump disputes many of the anecdotes Woodward assembled. But regardless of whether the President used those exact words, they do reflect an “easy money” philosophy that he has expressed many times before.

Trump Likes Low Rates, Loose Money

President Trump has described himself as a “low interest rate person.”

Trump and the federal reserve

This past summer, Trump launched a very public attack on the Federal Reserve’s rate hiking campaign. He wants it to stop because it’s making the dollar “too strong” and threatening to undercut his tax cut fiscal stimulus.

There’s only so much dollar strength the U.S. economy and U.S. debt and equity markets can take. President Trump is keenly aware of the risks.

A Fed rate hike next week is a given at this point.

The Trump-versus-Fed feud will likely heat up again in December if the central bank raises its benchmark short-term rate at its scheduled policy meeting. Although a December hike is far from certain, Fed chair Jay Powell and company seem intent on raising interest rates again – and possibly a couple more times in 2019 if the markets don’t melt down before then.

Additional tightening will increasingly put the central bank on the wrong side of the President’s Twitter feed. If Donald J. Trump wants to put more than social media pressure on Fed officials, he can threaten to remove them.

Trump himself appointed Powell, a decision he now apparently regrets. It would be unprecedented for a president to fire a Fed chairman before his term is up... but not necessarily inconceivable. After all, President Trump has done a number of unprecedented things, as the anti-Trump media are wont to remind us.


Read more: https://www.moneymetals.com/news/2018/09/18/trumps-power-play-fed-001619

September 14 2018

moneymetals

Gold vs. Bitcoin

Since its introduction in 2009, bitcoin has taken the financial world by storm.

The enormous gains in bitcoin’s value are attracting attention around the world, both positive and negative. People ranging from everyday consumers to central bankers now have an eye on the digital currency.

Some remain skeptical. Several high-profile hacks in which tens or even hundreds of millions of dollars-worth of bitcoin were stolen from bitcoin exchanges have raised doubts that a purely digital asset can ever be secured. Others wonder if money without official government backing and no physical manifestation can really succeed.

On the other hand, many see bitcoin as the future of money – destined to end run banks and governments and the fiat currency systems they control.

What is Bitcoin?

what is bitcoinBitcoin is a peer-to-peer, decentralized, digital currency with more than 10 million holders as of this writing. The lure of decentralization, lower transaction fees, and pseudo-anonymity has fostered adoption around the world. And people are increasingly looking for alternatives as central banks around the world continue to abuse national currencies.

There is a particular concern regarding the U.S. Federal Reserve Bank’s perpetual devaluation of its Federal Reserve Notes – commonly known as dollars. Although it is no longer a true dollar, which was historically defined in terms of a certain amount of silver, today’s U.S. dollar is still the world’s reserve currency. And Fed officials recognize no limits in terms of how many dollars can be created.

​Check it out here: 
https://www.moneymetals.com/guides/bitcoin-vs-gold


August 21 2018

moneymetals

Spot Prices Are Falling, But Premiums Are on the Rise

Gold and silver premiums – the price dealers add to the melt value of an item to cover manufacturing and overhead – began climbing in the past two weeks.

Many clients see falling gold and silver spot prices as an opportunity to buy, but some are disappointed to find the premium for the item they want is suddenly higher, negating some of the price drop.

The challenge they face is that lots of other bargain hunters are trying to jump on the same opportunity.

Supply & demand

Premiums are very sensitive to supply and demand in the retail market for finished coins, bars, and rounds, and the reasons are pretty straightforward.

First, when prices drop, retail bullion investors stop selling and start buying. That has a profound effect on the availability of resale, or secondary market, product inventory.

The large quantities coins, bars, and rounds coming back to market in the past year or two have driven premiums to the extraordinarily low levels we saw recently. Now, supply from the secondary market is drying up fast.

Second, there are only a few mints and refiners making coins, bars, and rounds. Like any manufacturer, they gear production to market demand. Scaling up takes a bit of time, and it isn’t something most will do without first developing some confidence that the higher demand will persist.

​Continue reading: https://goo.gl/cRFcUF​

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