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Fed Taper/Tightening Fears Driving Selling - Weekly Market Recap: Jan 7, 2022Jan 9, 2022 - 11:08:48 PST
I am piloting a new show here at Wealthion & we'd love your feedback on it. As a complement to our regular macro-focused interviews, a growing number of you have been asking for more "boots on the ground" analysis of the financial markets.
Bear Market In Stocks/Bonds, Bull Market In Metals/Energy | Michael PentoJan 8, 2022 - 08:22:59 PST
Here in Part 2, Michael offers a detailed breakdown of how he's allocating his portfolio now, how he will alter it if indeed a correction arrives, and how he then expects to re-invest his capital once the correction is over.
The dollar, the euro, the yen, they are all being managed to depreciate. Over the next ten years, these currencies will go down against real assets like real estate, gold, or equities. And they will go down against the renminbi.
Jan 7, 2022 - 12:56:30 PST
In 1708, the Spanish galleon San Jose sank in a deadly battle against English warships, taking with it billions in treasure. Centuries passed until a secretive archaeologist found the wreck, but now nations are again warring over who may claim the gold and glory.
Gold prices edged up from three-week lows on Friday after data showed U.S. jobs growth was slower than expected last month.
The result was a massive accumulation of cash on balance sheets. Corporations are holding much higher levels of liquidity than they did in 2019; banks have substantial fractions of their assets on deposit with their central banks; and saving rates remain well above normal in most countries.
As The Fed Seeks To Justify Raising Rates, Global Growth Rates Have Been Falling Off UniformlyJan 7, 2022 - 12:33:19 PST
Sentiment indicators like PMI’s are nice and all, but they’re hardly top-tier data. It’s certainly not their fault, these things are made for very times than these (piggy-backing on the ISM Manufacturing’s long history without having the long history). Most of them have come out since 2008, if only because of the heightened professional interest in macroeconomics generated by a global macro economy that can never get itself going.
A stroll through recent and not so recent inflationary history. A Cynical Fed is a Dangerous Fed.
November had been the weakest jobs report of the year until a meager 199k were announced for December. As shown below, over the last 18 months, only December 2020 was weaker. This was right when the Covid second wave was wreaking havoc and before vaccines became available to the public.
Shocking Consumer Credit Numbers: US Credit Card Debt Soars Most On Record With Savings Long GoneJan 7, 2022 - 12:19:12 PST
While it is traditionally viewed as a B-grade indicator, the November consumer credit report from the Federal Reserve was an absolute stunner and confirmed what we have been saying for month: any excess savings accumulated by the US middle class are long gone, and in their place Americans have unleashed a credit-card fueled spending spree.
The debt ceiling was raised in December and the Treasury responded immediately, adding $709B in debt over the month. To be fair, $470B of this was in Non-Marketable as shown below.Note: Non-Marketable consists almost entirely of debt the government owes to itself (e.g., debt owed to Social Security or public retirement)
Overall, I'm negative on the US dollar in 2022 because I believe in a continued rebound in the global economy. The big risk to that is omicron in China but we will just have to wait for that to unfold.
The largest cryptocurrency by market value fell as much as 4.9% to $41,008 before stemming the decline during U.S. trading hours. It hit a record of almost $69,000 on Nov. 10. Ether, the second-largest, dropped as much as 9% to its lowest level since Sept. 30. Both of those tokens, as well as others including Binance Coin, Solana, Cardamon and XRP are down more than 10%...
Jan 7, 2022 - 11:32:25 PST
It looks like markets are buying into the prospect of The Federal Reserve raising rates three times (Bob) in 2022. And ceasing COVID monetary stimulus. Today, the 10-year Treasury yield rose to PRE-COVID levels of 1.783%. And the Freddie Mac 30-year mortgage commitment rate rose to 3.22%, the highest since May 2020.
My view is consistent with gold’s 5000-year history as money and starts to become clear when considering that money is different from currency. Those two words are used interchangeably today, but they are fundamentally different.
Jan 7, 2022 - 09:12:22 PST
A proposal to bring universal healthcare to California, laid out in multiple pieces of legislation, faces significant hurdles in the coming months.
Crises: With More Than Half a Million Americans Homeless, the U.S. Is Still Struggling To SolveJan 7, 2022 - 08:35:14 PST
The Covid pandemic caused a surge in housing costs and a rise in unemployment, leaving nearly 600,000 Americans unhoused in 2020.
The leisure and hospitality sector led hiring in December as restaurants added wait staff, cooks and bartenders ahead of the holidays.
Most Expensive Home in America Lists for $295 Million, May Head to AuctionJan 7, 2022 - 07:58:55 PST
Along with a record-setting price, the property known as "The One," in the Bel Air section of Los Angeles, comes with a history of drama, lawsuits and debt.
Oil was poised for a third weekly gain as demand remained resilient while supplies are frayed across the OPEC+ coalition and beyond. Futures in New York fluctuated to trade near $80 a barrel on Friday, bringing this week’s increase to about 6%. Kazakhstan’s biggest oil producer has altered output at the giant Tengiz field following protests in the country...