Precious metals news

Gold prices surged due to Middle East tensions, especially after a deadly explosion in Gaza. This escalated concerns, impacting US President Joe Biden's scheduled trip to the region. Prior to this, there were fears of the conflict spreading, prompting Biden to send two aircraft carriers and place troops on alert. Following the explosion, Iran proposed a boycott and oil embargo on Israel. Despite claims of Israel's non-involvement by Biden, the situation remains tense. Bullion benefited, rising about 6% since Hamas's attack on Israel. Meanwhile, US economic data strengthened the case for sustained high interest rates, typically bad for gold. Currently, gold stands at $1,943.57 an ounce.

Footage from Wednesday showed Russian President Vladimir Putin in Beijing with officers carrying the "Cheget," a nuclear launch briefcase. This rare public display comes amid heightened tensions between Moscow and Washington due to the Ukraine conflict. Similar to the U.S. "nuclear football," the briefcase holds missile launch codes. As China bolsters its nuclear stance, Russia reconsiders withdrawing from the Comprehensive Nuclear Test Ban Treaty. The briefcase connects the president to military command.

The Federal Reserve is grappling with the US's soaring $33.5 trillion debt, leading to unexpected US bond yield increases and second thoughts on rate hikes. This debt threatens growth, unemployment, and inflation risks. The recent downgrade of the US's credit rating by Fitch and a 20% surge in the deficit to $1.7 trillion have amplified concerns about the nation's fiscal stability, with decreased foreign investments adding to the worries.

Mortgage rates rose for the sixth consecutive week, leading to the lowest home loan demand since 1995. Application volume decreased by 6.9% from the previous week. The 30-year fixed-rate mortgage interest increased to 7.70%, its highest since November 2000. Home purchase applications fell by 6% from the previous week and were 21% down from the same week a year ago. Refinance applications dropped 10% weekly and were 12% below last year's figures. As rates and home prices rise, more borrowers are considering adjustable-rate mortgages (ARMs) to increase purchasing power.

Surging benchmark interest rates have severely impacted the $10.6 trillion US corporate bond market. A hypothetical high-quality debt portfolio by BondCliQ Inc., which includes top companies like Coca-Cola, Boeing, and Microsoft, declined in value. Originally worth $1 million in early 2022, it's now valued at $612,863. Despite these bonds being from highly-rated companies, the rise in interest rates has caused their value to diminish. This situation poses a financial dilemma for those depending on these bonds for income.

Following a concerning dip in the NAHB sentiment survey, housing data disappointed. While starts increased by 7.0% MoM, they missed the 7.8% expectation and saw a downward revision for August. Permits dropped by 4.4% MoM, outperforming the anticipated 5.7% decline. Notably, multi-family permits suffered a significant drop, hitting their lowest since Nov 2022, while single-family permits inched up. This downturn, alongside strong construction employment, raises questions about housing affordability and The Fed's stance on the issue.

The Federal Reserve's strategy of debt-driven economic growth with low interest rates has backfired. Banks face near-record paper losses, especially smaller ones, due to rising interest rates. As the U.S. government's $33 TRILLION debt sees rising interest costs, the public is also grappling with surging personal debt. Despite Treasury Secretary Yellen's confidence in the U.S. economy, indicators like declining multifamily rents and low homebuilder confidence suggest otherwise. Meanwhile, inflation, once seen as a tool to devalue debt, is now hurting the middle class and low-income workers.

A bank run is unfolding at the Bank of Cangzhou in China due to fears of its exposure to the bankrupt property developer, Evergrande. While the bank assures its exposure is manageable and has taken legal actions to recover its loans, public panic persists. In response, Chinese authorities have arrested individuals spreading alleged rumors and are implementing measures to prevent further financial contagion. These include capital replenishment at banks, aiding in bad asset disposal, and regional operation restrictions.

The House recently ousted House Speaker Kevin McCarthy in the wake of the continuing resolution to keep spending money and avoid a government shutdown. Dissatisfied Republicans frustrated with the GOP's unwillingness to address the federal spending problem banded together with Democrats to send McCarthy packing.
While the outcome might be politically satisfying to some, it's not going to solve the underlying problem.

There is a persistent myth that inflation was "low" in the decade following the 2008 financial crisis.
It's time to bust that myth.

Gosh... the more I dig into things, the bigger the problems I find.  Today, I will describe the U.S. Treasury BLACK HOLE.  I have to tell you, while I think I have seen it all, I haven't... LOL.  Yes, I know I am a broken record, but when you see this information, it's amazing that the U.S. Government is still open for business...

Reverting to the gold standard raises eyebrows, but history offers a brighter perspective. Between 1879 and 1913, America flourished under the gold standard. This era bore witness to monumental innovations, from electricity to automobiles. This prosperity was due in part to a restricted government and its inability to mass-produce currency. However, 1913 marked a shift with the creation of the Federal Reserve, ushering in wars and inflation. Given our past, a return to hard money, through gold or silver, could promise enhanced prosperity, innovation, and a check on expansive government power. In essence, with hard money, both freedom and creativity thrive.

Gold remains a highlight, maintaining a bullish stance and targeting the significant $2000 mark, even as the US dollar strengthens. Technical analysis points to a triple top pattern on gold's larger timeframes. While traditionally a reversal sign, these patterns often fail, especially on larger timeframes, and can be mistaken for bullish continuation patterns like ascending triangles. If this is the case for gold, we might see it surge past the $2000 mark and aim for $2,300 or even higher.

Inflation remains high despite the Federal Reserve's efforts. With a 3.7% rise in prices over the past year and "core inflation" at 4.1%, the Fed's rate hikes haven't curbed inflation to their 2% target. The crux lies in the U.S.'s $33 trillion national debt and growing deficits. While higher interest rates were meant to suppress inflation, they exacerbated the government's deficit. The fiscal response anticipated from Congress to balance monetary policy hasn't materialized. Experts suggest only a reduction in spending can genuinely control inflation, a step Congress hasn't taken. Thus, high inflation continues.

After nine straight negative years, the year-over-year change increased by 0.06%. This report has spurred discussions on more rate hikes. Despite rising bond yields and mortgage rates nearing 23-year highs, Paul Krugman optimistically claims, “We Won the War on Inflation at Very Little Cost.” However, skeptics point to the Federal Reserve's role in destabilizing the housing market and driving inflation.

The financial and health prospects for Americans nearing retirement remain bleak, especially for those in the lower economic bracket, a study finds. Dubbed the "forgotten middle," these individuals fall between low-income and middle-class thresholds, missing both government support and the ability to comfortably manage rising expenses. While the affluent saw increased life expectancies, those less privileged either stagnated or declined. The widening gap in homeownership and diminishing health insurance underscore the growing inequalities. Experts warn of the looming strain on healthcare and family caregivers.

In 1906 Alfred Henry Lewis once highlighted the fragile line between stability and chaos. Today, unchecked U.S. monetary practices have driven alarming inflation, particularly in food. Despite official figures, the reality is grim, especially for lower-income families. With cuts to SNAP benefits and rising costs, food insecurity is escalating. Amid debates on government spending, essential needs are sidelined for other initiatives, pushing many Americans closer to a breaking point.

Homebuilder confidence has declined over recent months, with the NAHB index at a 9-month low. High interest rates are deterring younger buyers and increasing costs for builders. As a result, 62% of builders are resorting to financial incentives to attract buyers. With mortgages nearing 8% and the Federal Reserve's efforts seeming ineffective, the housing sector faces looming challenges.

September's US industrial and manufacturing data revealed alarming discrepancies: - Industrial Production: Grew a mere 0.3% MoM (SA), but alarmingly plunged 1.7% MoM (NSA). - Manufacturing Output: Barely rose by 0.35% MoM (SA), while it worryingly declined 0.5% MoM (NSA). These figures suggest that seasonal adjustments are masking the true state of the economy under the Biden administration. With manufacturing production consistently lower year-over-year for seven months and the auto production plummeting by 6.2% MoM, looming challenges are evident, exacerbated by anticipated UAW strikes.

Join Mike Maloney and his research assistant, Alan Hibbard, as they dive into a mesmerizing gold price chart spanning over five decades.