While the precious metals are totally off the radar by the majority of investors, silver is setting up for one major bull market. Yes, it’s hard to believe as the gold and silver prices have been trending lower while the broader markets grind up higher, but if we look at the fundamental and technical indicators, the stock market and precious metals are now at extreme opposites.
After a period of excellent returns since 2008, Gilts will no longer be a profitable investment and those investors that ventured into Gilts as a way of increasing income from cash could get a nasty surprise when they realise how sensitive Gilt prices are to changes in yield. With the 10 year yield at just 1.3% compared to an inflation rate of 3.1%, those investors are already suffering a loss in real terms. But if we get an adjustment back to a positive real yield, the capital loss will be extremely damaging to prices. For long dated securities, losses could be in excess of 20% for a movement in yield of just 1% and that would be just the start of the adjustment. That recovery period could stretch into years.
This trend toward working remotely is actually very close to my heart, it’s how Mauldin Economics operates. Since my partners and I founded the company back in 2012, we have been a “virtual business.” Although we have over 40 members of staff, no more than three of us are in the same location. Right now, my team lives in a wide range of locations: from Dallas to Dublin, Ireland, and Vermont to Vilnius, Lithuania.
Or perhaps more accurately these blogs are the counterpoint. The Conservative “bias” (perspective) is clearly stated up front. The so-called “main stream media” feigns objectivity but is a propaganda tool of the Left/Democrat Party/Communists/Socialists. I don’t know if there is a source that is truly “objective” (everyone has a point of view). At least here at TCTH facts are laid out & source material is provided & one can dig as deeply as they want into the rabbit hole. We are not spoon fed drivel like the “MSM” provide for the useful idiots who believe they get the straight story from straight shooters.
RATE AND REVIEW this podcast wherever you listen.https://itunes.apple.com/us/podcast/the-peter-schiff-show-podcast/id404963432?mt=2&ls=1Turkey's Current Account DeficitThe "Turkey baste" continued on Monday, although Tuesday we did have a bit of a reversal, Tuesday bounce in the lira, rising about 7 percent or so, in today's trading. But still, ...…
I have preached, in fact I have over-preached, on staying agile in tough markets. Remember, when the beat-down comes your way, I want you all to cover the P/L on your screen with a post-it. This one little trick is something I do myself. By doing this, the trader allows him or herself to make tough, reasoned decisions without the constant distraction that one's profit/loss number can be.
I would contest a little bit, Erik, the idea that we have not been monetizing the debt. The Fed, of course, has been monetized. It’s buying federal securities with credit that did not exist before the Fed tapped the relevant numbers on its computer keypad. The Fed has come to own substantial portions both of mortgage-backed securities and of Treasuries securities outstandings.
Just like a secular bull market, a secular bear market is one that lasts between five and 25 years. And while the average length of a secular bear market is about 17 years, there may be smaller bull or bear markets within it. Still, the average bear market is much shorter -- usually under a year -- and so definitions of what constitutes a secular bear market vary.
In this article I point to the pressures on the Fed to moderate monetary policy, but that will only affect the timing of the next cyclical credit crisis. That is going to happen anyway, triggered by the Fed or even a foreign central bank. In the very short term, a tendency to moderate monetary policy might allow the gold price to recover from its recent battering.
There has never been a more fiscally clueless team at the top than the Donald and his dimwitted Treasury secretary, Simple Steve Mnuchin. After reading the latter's recent claim that financing Uncle Sam's impending trillion dollar deficits will be a breeze, we now understand how he sat on the Board of Sears for 10-years and never noticed that the company was going bankrupt.
“If you pay peanuts, you get monkeys” is the perfect way to describe the current market. Investors are all playing the same game and reinforcing the passive investing trend by constantly plowing more money into passively managed funds. The management fee of the iShares Core S&P 500 ETF (NYSE: IVV) is just 0.04% which is extremely low and positive for investors. However the low fees, mindless investment strategies, and extremely high valuations will lead to a catastrophe when the same mindless buying reverts to panicked, mindless selling.
In addition, during World War II, the Empire of Japan considered wildfires as a possible weapon. During the spring of 1942, Japanese submarines surfaced near the coast of Santa Barbara, California, and fired shells that exploded on an oil field, very close to the Los Padres National Forest. U.S. planners hoped that if Americans knew how wildfires would harm the war effort, they would work with the Forest Service to eliminate the threat. The Japanese military renewed their wildfire strategy late in the war: from November 1944 to April 1945, launching some 9,000 fire balloons into the jet stream, with an estimated 11% reaching the U.S. In the end the balloon bombs caused a total of six fatalities: five school children and their teacher, Elsie Mitchell, who were killed by one of the bombs near Bly, Oregon, on May 5, 1945. A memorial was erected at what today is called the Mitchell Recreation Area.
ANSWER: You are correct, that concerns over U.S.-Russian relations, coming talks on the Korean Peninsula, action in Syria over a suspected chemical weapons attacks and uneasiness over trade conflicts would normally be the battle cry to buy gold. Traditionally, this would form a cocktail of geopolitical uncertainty that would lead to screams buy gold! The uncertainty has not led to support for gold. They are proving to be a narrative that no longer seems to be factors for the bulls. Read More
Food programs are widely considered welfare to the people using them. In fact they are welfare to the food industry: it is a direct transfer of government (tax) bling to the pockets of General Mills, General Foods, Cargill, ADM, Monsanto, and the other Big Food/Big Pharma companies. It is tax bling to the grocers as well. These companies can keep marking up food for profit, squeezing those who pay money for it AND pay taxes so those who can’t afford the food can give Munchy Bucks to their local food vendor, and those dollars are credited to the food industry.
Like the Doctor, I think home prices are resetting to fundamentals. When you lose your equity suddenly you don’t care if prices fall another 30 to 40 percent. With this growing contingent of negative equity homeslaves approaching critical mass you may see the following solution arise to reset home prices so our economy can regain its stability as people will have more money available for other parts of their budget that is now being confiscated for the Too Big To Fails.
The most recent drop puts stock prices, even after more than two weeks of losses, only back to where they were in July of this year. And yet, we may be much closer to panic territory than it appears. Based on valuations, all it would take for stocks to enter a bear market would be a 5 percent drop in the S&P 500 from here. At the low on Tuesday, when the S&P 500 was down 60 points, the market was within 90 points of that threshold.
When a brushland, woodland, or forested area is not affected by fire for a long period, large quantities of flammable leaves, branches and other organic matter tend to accumulate on the forest floor and above in brush thickets. When a forest fire eventually does occur, the increased fuel creates a crown fire, which destroys all vegetation and affects surface soil chemistry. Frequent and small 'natural' ground fires prevent the accumulation of fuel and allow large, slow-growing vegetation (e.g. trees) to survive.
In our regular gold trading alerts, we focus on the short- and medium-term outlook and we rarely discuss the very long-term issues or price targets. The reason is simple – the long-term issues and price targets don’t change often, so usually there’s little new to say about them. Consequently, it’s been a long time since we last discussed our view on gold’s explosive upside potential. In fact, it’s been so long that those who do not take the time to read our analyses thoroughly and those who have been reading them for only a short while may think that we are bearish on gold in the long run. Or that we’re perma-bears. Naturally, it’s nonsense and those who have been diligently following our articles know it. What we’re aiming for is to help investors position themselves to make the most of the upcoming rally in the precious metals market and one of the best ways to do it is to help people prepare for the final bottom in gold. Read More
RATE AND REVIEW this podcasthttps://www.facebook.com/PeterSchiff/reviews/What About Employers' Day?Labor Day is coming up on Monday it it annoys me that we just have a Labor Day and we don't have an Entrepreneur Day. We don't have a day to celebrate the employer. Why is that? The entrepreneurs are the unsung heroes of the American economy. I'm ...…
RATE AND REVIEW this podcast on Facebook.https://www.facebook.com/PeterSchiff/reviews/Optimism Over No Tariffs Fueling Market MoveDonald Trump, I think, was the reason the markets ended up finishing in the black today, at least most of the major indexes. In fact, the only index that was down on the day was the NASDAQ - the NASDAQ was the only m ...…
*** “Treasury officials said their decision to halt the issuance of the 30-year bonds was intended to save the government money,” writes Gretchen Mortgensen in the NY Times. “Traders scoffed at that explanation, viewing the move as an almost desperate attempt to push down long- term interest rates, and prod both corporate and individual borrowers to spend again.”
Financial crisis of 2007–08 16 Sep 2008 On September 16, 2008, failures of large financial institutions in the United States, due primarily to exposure of securities of packaged subprime loans and credit default swaps issued to insure these loans and their issuers, rapidly devolved into a global crisis resulting in a number of bank failures in Europe and sharp reductions in the value of equities (stock) and commodities worldwide. The failure of banks in Iceland resulted in a devaluation of the Icelandic króna and threatened the government with bankruptcy. Iceland was able to secure an emergency loan from the IMF in November. Later on, U.S. President George W. Bush signs the Emergency Economic Stabilization Act into law, creating a Troubled Asset Relief Program (TARP) to purchase failing bank assets. Had disastrous effects on the world economy along with world trade.  
JOIN PETER at the New Orleans Investment Conference https://neworleansconference.com/conference-schedule/ 831 Point Rout in the Dow Jones Industrial Average If you listened to Friday's podcast, I mentioned that I thought I would probably be doing a lot of podcasts this week. I did one yesterday, and I am doing another one today because my feeling about the stock market was confirmed today with an 831 point rout in the Dow Jones Industrial Average, down 3.15%. This is the biggest decline that the Dow has had since that 1000+ point drop that we had in February. I think it is maybe the third biggest down day ever, point-wise. Percentage-wise it's not even close. NASDAQ Down Over 4% The DJIA actually did a lot better than a lot of the other averages. The Dow Jones transports were down just over 4%; 445 points. the NASDAQ was down over 4% as well - 315 points. Weakness across the board in the stock market today. And it's not just the homebuilders and the autos. I've been talking about those sectors as leading indicators and, yes, many of those stocks made new 52-week lows today as well. But they were not the worst performers on the day. Financials Helped Lead the Declines The financials were helping to lead the decline. Again we have Morgan Stanley at a new 52-week low, down 3.3%. Goldman Sachs down 3.6%, a new 52-week low. But really, the biggest losers on the day were the tech stocks. These have been the stand-outs. This is what has been holding up the market - the FAANG stocks, all of these technology infotech stocks - and a lot of people were actually describing them irrationally as a "safe havens". I couldn't believe it when people were saying that tech stocks were the new "safe havens". When you hear stuff like that, you know you're close to the end. FAANG Stocks Selling in After-Hours Trading If you look at what some of these darlings did today, and I'm looking at the after-hours prices, too, because they're selling. More selling is going on now, after the bell. But look at NVIDIA, down over 9%, Amazon down 7.3%, Netflix down 10% on the day. AMD down 11% - Twitter down almost 9%, Apple down 5.5%, Intel 4.5%, Cisco, 4.7%, Facebook down almost 5%. this is basically one day plus an hour of aftermarket trading.
In today's low interest rate environment, equity is being retired by many companies through stock buybacks. Many mergers are still being done with debt...since it is less expensive than issuing stock. Also, I would argue that the value of a well run company with good finances and a rising dividend stream is far greater, per se, than it has been historically.
"We believe we are in a 'rolling bear market,' a market where risk assets across sectors and geographies reprice to account for the removal of central bank provided liquidity," Morgan Stanley strategist Mike Wilson told TheStreet in September. "Less central bank liquidity support as we near the end of an economic cycle should bring higher volatility, as risk assets and markets lose some of their ability to absorb shocks. Our call is not for a simultaneous and large repricing across risk assets, but for a bear market that rolls through different assets and sectors at different times with the weakest links (Bitcoin, EM debt and equities, BTPs, funding spreads, base metals and early cycle industries like home builders and airlines) being hit first/hardest."
As of early March 2009, the Dow Jones Industrial Average had fallen 20% since the inauguration of President Barack Obama (less than two months earlier), the fastest drop under a newly elected president in at least 90 years. Editorials in the Wall Street Journal by the editorial staff and Michael Boskin, one of George H.W. Bush's Council of Economic Advisors, blamed this on Obama's economic policies.
It often happens that gold and silver prices hit low points in June and December, before rallying sharply. The reason is not hard to understand: traders at the bullion banks close their books at the year and half-year ends and are almost certainly instructed by their superiors to reduce their trading positions to as low a level as possible. This is because the banks wish to report balance sheets that reflect low risk exposure for the purpose of making regulatory returns. Read More
Economic cracks big enough to drive a car industry into are opening up all over the globe. Trade gaps are opening up between major allies. Widening spreads between the dollar and other currencies are shredding emerging markets. As we start into summer, these cracks and several others described below have become big enough to get everyone’s attention, just as I said last year would become the situation.
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For investors looking to maintain some positions in the stock market, a defensive strategy is usually taken. This type of strategy involves investing in larger companies with strong balance sheets and a long operational history, which are considered to be defensive stocks. The reason for this is that these larger, more stable companies tend to be less affected by an overall downturn in the economy or stock market, making their share prices less susceptible to a larger fall. With strong financial positions, including large cash holdings to meet ongoing operational expenses, these companies are more likely to survive downturns.
Key to remember here, one must understand that they are actually in a fight. Then one must identify both danger, as well as targets of opportunity. After that, the trader can adapt to the new environment. Do not even worry about overcoming market adversity. One overcomes naturally once properly adjusting to these new conditions. You will not know that you have overcome until you already have.
Yet in many ways, bad news for bonds is good news for equities. Investors seem to turn to stocks when bond prices are falling, as changes in bond yields and equity performance have been positively correlated since 1998. Plus, an increase in inflation expectations that's driven by economic growth is usually a good sign for equities, especially when expected inflation crosses the 2 percent threshold.