Precious metals news

It's one thing when the Western wind power companies lose money, but another thing entirely when it happens to the largest firm in China.  Why?  China is supposed to be the lowest-cost producer in the world.  This is just another nail in the coffin for the Green Energy Industry...

Watch now to benefit from what's coming.

Ahead of a possible challenge on the $2000 level, gold consolidated recent rises this week, and silver held up well. This morning in European trade, gold was $1995, up $15 from last Friday’s close, and silver was $23.70, unchanged on the week. Comex volumes were healthy, despite the Thanksgiving holiday in the US.
Open Interest in both Comex contracts is rising, as shown below.

Gold’s OI is now over 500,000 contracts, which is putting pressure on the shorts, predominantly bullion bank trading desks, while silver still remains subdued. From the Commitment of Traders reports, the position of the gold swaps (mainly bullion banks) is shown below and reflects the developing squeeze on their positions.

The Swaps have a problem. Their traditional target, hapless money managers, carries a smaller net long position than the Other Reported category, some of which are using Comex paper to secure delivery and is less susceptible to takedowns. Additionally, the Producer/Mer...

Silver uniquely bridges the gap between precious and industrial metals, offering a dual perspective as both an investment and a risk protection vehicle. When analyzing silver, investors are simultaneously evaluating a precious metal, akin to gold, and an industrial metal, similar to copper. Its versatility makes silver an ideal choice for those uncertain about whether to focus on precious or industrial metals in their investment strategy.

Gold is showing strength in a quiet market, poised to re-test the $2,000/oz. level and its recent high near $2,010/oz. Despite rising U.S. government bond yields, gold maintains its position, though low trading volumes may be influencing market dynamics. Today's flash S&P PMIs release could introduce some volatility, but overall market activity is expected to stay subdued until next week. Meanwhile, U.S. Treasury bond yields are climbing, with the 2-year yield now at 4.95%, ahead of significant short- to medium-term Treasury auctions totaling $148 billion next week. This upward trend in yields suggests a favorable environment for gold as traders seek value amid these bond market movements.

A recent Wall Street Journal/NORC survey reveals that only 36% of voters believe the American dream is still attainable, a significant decline from 53% in 2012 and 48% in 2016. This perception shift indicates growing skepticism among Americans about the feasibility of achieving success through hard work, including goals like homeownership. This change in sentiment reflects a notable drop in confidence compared to last year, when 68% felt that hard work could lead to getting ahead.

The Bureau of Labor Statistics reported that year-over-year inflation continued to rise, marking the thirty-second consecutive month of inflation exceeding the Federal Reserve's two-percent target. In October, the Consumer Price Index (CPI) increased by 3.2% compared to the same month last year, the slowest pace since July. On a month-over-month basis, the CPI saw a negligible change, rising only 0.04% from September to October, essentially registering zero percent growth. This data indicates ongoing inflationary pressure in the U.S. economy.

During the 1970s gold went up 15-fold, even faster than oil. Silver went up 8-fold. The U.S. economy's current state of high inflation and slow growth mirrors the 1970s' stagflation, but with much higher national and private debt today. This situation limits the Federal Reserve's ability to aggressively combat inflation without triggering a financial crisis. In this context, investing in gold becomes a prudent strategy, as it has historically maintained value during periods of economic uncertainty and inflation.

The overuse of the U.S. dollar in financial warfare has led to its declining global dominance, a concern raised a decade ago and now being realized as countries like Russia and China reduce their reliance on the dollar. U.S. Treasury Secretary Janet Yellen acknowledges the risk sanctions pose to the dollar's hegemony. Recent proposals to seize Russian assets for Ukraine's war efforts could further undermine the dollar, potentially triggering a broader financial crisis and underscoring the need for careful U.S. policy decisions regarding the dollar's role in international finance.

China, the world's second-largest economy, has been significantly reducing its holdings of U.S. Treasury securities for over a decade. The U.S. Treasury Department reports that China's holdings have dropped to their lowest in 14 years, decreasing by over $491 billion from a peak of $1.297 trillion in May 2013 to $805.4 billion as of August 2023. This divestment coincides with Moody's changing the U.S. credit rating outlook from stable to negative, citing America's deteriorating financial position and political gridlock. While this doesn't guarantee a credit rating cut, Moody's indicates an increased likelihood of such a move in the future, especially if effective fiscal measures to manage government spending or increase revenues are not implemented.

Biden, Congress, and The Federal Reserve are increasingly disconnected from the struggles of America's middle class. The Federal Reserve, a private entity, has the unique ability to pass its massive unrealized losses, now exceeding $1.3 trillion, onto the U.S. Treasury. This situation highlights the Fed's controversial role in interest rate manipulation and its impact on the national economy. Additionally, FDIC-insured banks are facing significant losses, further exacerbated by negative bank credit growth for 16 consecutive weeks. These developments call into question the current financial policies and the very existence of the Federal Reserve in its current form.

The Biden administration claims to have made Thanksgiving more affordable, but this perspective is challenged by the reality of persistently high prices. Since Biden's inauguration, turkey prices have increased by 235% and gasoline prices are still up by 47%, despite recent minor decreases. The administration attributes the recent price declines to their efforts, but these reductions are more likely linked to a decrease in M2 Money growth, now at -3.6% year-over-year, following extensive federal spending during the Covid crisis. The significant rise in turkey prices under Biden's tenure is a stark reminder of the ongoing economic challenges.

In the past year, global interest rates have sharply increased from historic lows, with notable disruptions including a UK market panic and a U.S. banking crisis. Despite easing inflation, there's skepticism about achieving a "soft landing" for the economy. Financial historian Edward Chancellor, in his discussion on Merryn Talks Money, highlights that low interest rates for extended periods have led to the misallocation of capital across numerous sectors, indicating deeper economic issues beyond just controlling inflation.

Did you know Thanksgiving almost didn't happen thanks to the Pilgrims' experiment with socialism? It didn't work. Fortunately, they figured out some economic truths and the rest is history. In this episode of the Friday Gold Wrap, host Mike Maharrey tells the Thanksgiving story you almost certainly didn't hear in school. He also explains why today is called Black Friday.

The dollar's decline and the yen's rise signal mounting investor skepticism about the sustainability of current U.S. interest rates, amid growing expectations of an impending rate cut by the Federal Reserve. This trend, marked by a notable 2.8% drop in the dollar index this month, reflects deepening concerns about the potential for an economic downturn, despite the market's premature optimism for rate cuts. The complex global economic situation, with indicators like the inverted yield curve, points towards a challenging financial future, possibly necessitating more drastic rate cuts in response to a looming recession.

The U.S. dollar fell as investors anticipated a peak in U.S. interest rates, while the Japanese yen strengthened due to rising consumer prices. Expectations that the Federal Reserve may halt rate hikes and start cutting them next year contributed to the dollar index's decline, potentially its weakest monthly performance in a year. Analysts predict that the Federal Reserve and the European Central Bank may cut rates around mid-2023, with the Bank of England possibly leading rate cuts as early as May.

This article concludes that the current downturn in bond yields is part of a continuing market manipulation by central banks in order to restore confidence in the global economic outlook.
There is a long history of government intervention in markets. In the nineteenth century, it was by legal regulation, the most notable of which was the 1844 Bank Charter Act, which had to be suspended in 1847, 1857, and 1866.
From the early 1920s, the emphasis on intervention changed under Benjamin Strong, the first Fed Chairman, who started to deliberately expand central bank credit to stimulate the economy. Coupled with the expansion phase of the commercial bank credit cycle, this led to the roaring twenties, the stock market boom, and its collapse.
Presidents Hoover and Roosevelt compounded the errors with economic interventions which only succeeded in prolonging the 1930’s depression. It was the start of modern government economic and monetary manipulation, which took on a new urgen...

What is it that has prompted Mike Maloney to interrupt his Thanksgiving holiday and create a new presentation?

Gold is experiencing an upswing due to increased geopolitical risks, a weakening US Dollar, and falling US Treasury bond yields, leading to a recovery in investment flows. Central bank purchases of gold have been robust, with projections suggesting they could reach 1,050 tons in 2023. Additionally, physical gold demand remains strong, as evidenced by a 60% year-over-year increase in India's gold imports in October.

The U.S. fiscal situation is dire, with a significant portion of federal spending going towards interest payments on the national debt. Around 40% of the $2.5 trillion collected annually from personal income taxes is now used to pay this interest. If current trends continue, soon all personal income tax revenue could be required just to cover these interest payments, leaving little for other government obligations. This burden on taxpayers is escalating as the national debt, currently at $33.75 trillion, continues to grow rapidly.