Precious metals news

JPMorgan strategist, Marko Kolanovic, warns of looming downturns as the S&P 500 nears his 4,200 target, drawing parallels to the 2008 crisis. He cites challenges like overvalued markets, tech stock gains concentration, and tighter financial conditions, including rising interest rates. With increasing delinquencies in credit and loans, Kolanovic urges caution, noting that current market chatter mirrors pre-2007 crisis.

The tale of the Roman Denarius offers not just a glimpse into the past but also a warning for the future...

The S&P 500 Equal Weight index has plummeted, erasing gains and revealing a bleak broader market concealed by the performance of tech giants like Nvidia, Tesla, and Apple in the standard S&P 500. Dominance of these few stocks heightens market vulnerabilities. As the Federal Reserve scales back with a record QT nearing $1 trillion and prolonged higher rates, the markets are strained. QE once boosted markets, but QT is now eroding them.

Pending home sales in August plummeted 7.1% MoM, drastically worse than the forecasted 1% drop, marking the sharpest decline since September 2022. This downturn mirrors the record lows during the COVID lockdown. Every region faced setbacks, with some regions hitting their weakest since 2001. Experts warn of a bleak outlook with rising mortgage rates, raising concerns about the housing market's prolonged instability.

With the Asian hegemons undoubtedly able to introduce gold standards, where does that leave the dollar?
This article describes just how precarious the fiat dollar’s position has become. For now, the dollar appears to be buoyed up by rising bond yields. However, as they rise further portfolio losses for foreign investors are likely to increase, leading to dollar liquidation. It is not generally realised how many dollars and dollar securities are owned by foreigners, the bulk of them being held outside the US banking system. And the quantity of foreign currency owned by Americans to absorb this selling is very small in comparison.
Higher interest rates and bond yields also threaten to destabilise the banking system, a problem equally faced by the Eurozone, the UK, and Japan. But how can the US Government protect itself from this danger?
The only answer is to admit to the end of the fiat era and put the dollar back onto a gold standard. However, the US Government does not h...

The U.S. economic outlook darkens as the Bureau of Economic Analysis (BEA) releases revised Q2 GDP data. Personal consumption, a pivotal component of GDP, was a significant letdown. Initially expected at 1.7%, it came in at just 0.8%, a dramatic drop from Q1's 3.8%. This marked the worst consumer performance since the COVID-ridden Q2 of 2020. Despite headline GDP figures meeting expectations, the underlying data indicates severe consumer weakness. Factors like the resumption of student loan payments, potential federal government shutdowns, and reduced auto production only magnify concerns for impending economic decline.

Find out how the average taxpayer owes a staggering quarter-million dollars in taxes!

Amid persistent high inflation and interest rates, 60% of U.S. adults live paycheck to paycheck. With the consumer price index up 3.7% from last year, stagnant wages strain households. The Federal Reserve's 11 rate hikes haven't stemmed inflation, severely impacting lower-income individuals. Essential costs continue to rise, and 70% of Americans report financial stress, with less than half having an emergency fund.

Initial jobless claims stood at 204k for the consecutive second week, noticeably below the anticipated 215k. This marks the lowest non-seasonally-adjusted claims since September 2022, registering at 175. While anomalies such as the Ohio fraud and Minnesota extensions seem largely rectified, claims in Ohio surged, only surpassed by California. Continuing claims remain under 1.7 million. Yet, with The Conference Board survey indicating a declining labor market and stringent financial conditions, it raises questions about the accuracy of current claims data. When will it truly mirror the reality?

In the world of politics, there's often more to the story than meets the eye.

The Federal Reserve has pushed interest rates to over 5%. At the most recent FOMC meeting, it indicated that it may have to hold rates higher for longer. But the mainstream remains unconcerned. The narrative is that the Fed has successfully raised rates to fight inflation and is now guiding the economy to a "soft landing."
In a nutshell, the mainstream financial media seems convinced the US economy has dodged a recession. Meanwhile, the average American seems less than convinced.
So, who's right?

All eyes are on the Federal Reserve, and people are wondering, what will it do next? The messaging coming from the central bankers is that they will need to keep interest rates higher for longer. But is that possible given the economic conditions and all of the debt in the economy?
Investment and economics writer Jim Grant appeared on CNBC's Squawk Box to discuss the Fed's inflation fight and its impact on the economy. He said we ask too much of the central bankers. After all, they are only human.

While the oil industry likes to focus on the near-record amount of oil supplied to the world, they fail to warn about the massive annual decline rates.  Thus, continuing to keep global oil production at such high levels will only devour proven reserves at a quicker pace...

**Gold's Market Dynamics** Unlike consumer goods, gold isn't consumed but held. Its market is unique: gold holders can be both sellers and buyers. An uptick in trades doesn't necessarily mean higher demand. Gold's supply represents owners' willingness to sell at certain prices. Miners, despite their minor role, accept market-set prices. Gold's value hinges on both its historical monetary status and the balance between current owners' and potential buyers' assessments. Misunderstanding this leads to inaccurate analysis.

A potential U.S. government shutdown looms on Sept. 30, and if it happens, it might be worse than previous instances. Historical shutdowns usually stemmed from policy disputes, but this one revolves around fundamental disagreements over government financing. A deeply divided Congress, especially within the Republican House caucus, and a history of policy fights make a resolution by the deadline uncertain. If the shutdown occurs and extends like the 35-day 2018 standoff, the economic implications could be severe, further straining an already fragile economy. Investors are advised to tread with caution.

Bank of America reported a staggering $105.79 billion in unrealized losses on its held-to-maturity (HTM) securities for Q2 2023. This amount represents 34% of all unrealized losses from 4,645 FDIC-insured banks. Despite being the second-largest bank in the U.S., its losses significantly outpace those of its peers like JPMorgan Chase and Citibank. Questions arise as to why Bank of America's losses are disproportionately high. Their press contact remained unresponsive when questioned about the discrepancy. The way these losses are recorded hides the real financial damage, as they don't affect the income statement.

The Case-Shiller indices show a significant rise in housing bubbles since 2000. Miami and San Diego lead with a 317% surge, with index values at 417, followed closely by Los Angeles at +316%. The index uses a "sales pairs" method, offering a more accurate representation of housing price trends. Essentially, it measures home-price inflation. However, not all cities experienced such growth. Chicago, for instance, saw only a 97% increase since 2000, excluding it from the top housing bubbles.

While a drastic 40% market plunge might not be imminent, the numbers suggest that a significant drop is plausible. If real rates dip and growth remains stagnant, the S&P could potentially fall to 3,500, marking an 18% descent from its September 26 position. The historically low real rates of recent years have inflated PE multiples and driven profit margins to unprecedented highs. As real rates begin to rise, this bubble is at risk.

The US dollar index soared to its peak since November, while the 10-Year Treasury Note yield reached a high not seen since 2007, causing stock markets to plummet. The Fed's recent announcements caught investors off guard, leading to instability in global markets. Both the dollar and the 10-year yield are nearing an alarming "overbought" status, a concerning signal not seen in a year.

Mortgage rates have hit their highest levels in over 20 years, with the 30-year fixed rate reaching 7.41 percent, the highest since December 2000. Consequently, mortgage applications have declined 1.3 percent, according to the Mortgage Bankers Association. Additionally, the volume of mortgage loan applications and the Purchase Index have also seen significant decreases compared to the previous week and the same period a year ago.