Precious metals news

The International Monetary Fund (IMF) has acknowledged the use of the Chinese Yuan as a currency for debt repayment, signaling a potential shift away from the U.S. dollar. Argentina recently paid off a portion of its debts to the IMF, equivalent to $1.1 billion, in Chinese currency. IMF spokesperson Julie Kozack confirmed that the renminbi (RMB) is one of the five freely usable currencies accepted by the IMF for settling obligations. While negotiations regarding Argentina's $44-billion program are ongoing, Kozack denied receiving a letter from China indicating the use of a swap line with the Chinese Central Bank for IMF dues repayment. The Argentine Central Bank previously signed a deal with China to renew a swap line, increasing freely accessible funds from 35 billion yuan to 70 billion yuan. Argentina's move to incorporate the yuan as a currency accepted for deposits in savings banks and checking accounts, along with Brazil's agreement to conduct trade and investments in their own currencies, demonstrat...

During an official visit by India's Prime Minister Narendra Modi to the United Arab Emirates (UAE), the two countries have taken steps to reduce their reliance on the U.S. dollar. They have signed an agreement allowing trade settlement in Indian rupees instead of dollars, aiming to eliminate the costs associated with currency conversions. Additionally, they have agreed to establish a real-time payment link to facilitate cross-border money transfers, further promoting seamless transactions and greater economic cooperation. India, as one of the world's largest importers and consumers of oil, has traditionally paid for UAE oil in dollars. However, with this new agreement, India could potentially make its first rupee payment for UAE oil to Abu Dhabi National Oil Co (ADNOC). This move aligns with India's previous announcement to settle global trade in rupees, showcasing its efforts to reduce dependence on the dollar. The Reserve Bank of India has stated that the central banks of India and the UAE will link Ind...

The analysis explores the impact of the dollar wars and Western sanctions on various countries, highlighting the negative consequences for those challenging the dominance of the U.S. dollar. It emphasizes the potential role of gold as an alternative and its significance in countering the influence of the dollar. The first two dollar wars targeted Iraq and Libya, both major energy powers that threatened the petrodollar by seeking to sell oil in currencies other than the dollar. These actions led to military intervention and devastating outcomes for these countries. Gold played a role in both cases, with Saddam Hussein and Muammar Gaddafi challenging the legitimacy of the dollar and proposing alternative currencies backed by gold. Russia, as another energy powerhouse, indirectly faced a dollar war through the conflict in Ukraine. To reduce its reliance on the dollar, Russia began liquidating its holdings of U.S. Treasury bonds and pursued trade agreements using national currencies, including gold-backed agr...

For the past decade, Zoltan Poszar has arguably been the world's foremost expert in the ugly nuances and arcanery in world money-markets (and more recently, on how the financial and physical markets overlap on the geopolitical chessboard). However, his insights paint a bleak picture of the global economy. Poszar claims that we are witnessing a shift away from US dollar dominance towards a multi-polar world, ushering in the era of "Bretton Woods III." He discusses the concept of de-dollarization, the resurgence of gold as a monetary asset, and the utilization of central bank digital currencies (CBDCs) to construct an alternative financial system. Poszar highlights the growing focus in the West on reducing reliance on Chinese supply chains and striving for self-sufficiency. Conversely, countries in the East seek to extricate themselves from the Western financial system, reducing their exposure to the US dollar and Western financial institutions. He suggests that the rise of CBDCs could facilitate direct set...

Three banking giants and an additional financial institution are being hit with a mere multimillion-dollar fine, which pales in comparison to their immense net worth, for their involvement in a global billion-dollar fintech scam. The Monetary Authority of Singapore (MAS) has fined DBS, OCBC, Citibank Singapore, and Swiss Life for flagrant violations of anti-money laundering and anti-terror financing laws related to the notorious $2.1 billion Wirecard AG scam. These financial institutions, collectively managing a staggering $992 billion in assets, have been found guilty of a litany of failures. They neglected to conduct proper investigations into large transactions, failed to maintain customer due diligence, and neglected to ascertain the source of wealth for high-risk customers. This abysmal display of compliance and oversight has contributed to the perpetuation of the fraudulent scheme. Wirecard, the disgraced German payments firm, came clean in June 2020, acknowledging that the purported $2.1 billion ca...

The war's relentless continuation, now spanning almost 17 months, is exacting a heavy toll on the global economy, leading to heightened anxieties among policymakers regarding resurgent inflation and faltering growth. Against this backdrop, the G-20 nations are convening to discuss critical issues, including regulations for cryptocurrencies and strategies to secure additional climate financing. Pressing demands will be placed on the World Bank and the International Monetary Fund (IMF) to bolster their balance sheets and address the dire consequences of climate change and potential future pandemics. These meetings build upon discussions held in Paris recently, where commitments were made by 40 world leaders to facilitate easier access to funds for financially stressed developing countries. However, the key meetings face major challenges and negative undertones. As the G-20 president this year, India has struggled to achieve consensus among member nations, particularly concerning language related to the ongo...

The dollar is currently experiencing a significant decline, marking its worst slump since November. This decline has led many strategists and investors to believe that a turning point for the world's primary reserve currency is imminent, with potentially far-reaching consequences for global economies and financial markets. Several factors contribute to the dollar's weakening position. Signs of cooling inflation have bolstered expectations that the Federal Reserve will soon halt its interest rate hikes, which has dampened investor confidence in the currency. Moreover, there is a growing belief that rate cuts are inevitable in the future, with market consensus suggesting they may occur in 2024. Steven Barrow, head of G-10 strategy at Standard Bank, argues that the dollar's decline will extend over multiple years, attributing it to a shift from the Federal Reserve's tightening cycle to an easing cycle. He believes that this shift will not only drag the dollar down but also exert downward pressure on other cu...

With three months left, the fiscal 2023 budget deficit has already eclipsed the massive 2022 shortfall.
The US government ran a $227.77 billion deficit in June, pushing the total fiscal 2023 shortfall to $1.393 trillion, according to the Monthly Treasury Statement for June.

Can the Federal Reserve navigate a narrow path and slay price inflation while steering the economy to a soft landing?
During an interview on CNBC Squawk Box, financial analyst Jim Grant expressed his doubts.
He compared Jerome Powell's task to Captain Chelsey Sullenberger's when he was forced to land a US Airways plane on the Hudson River after an inflight emergency, nothing Powell is "no Sully."
Grant went on to explain that even if things don't look so bad right now, rivets are popping in the economy.

Get ready for higher Oil Prices and weaker Natgas prices, as this disconnect will continue for the next several months.  Also, some interesting signs are taking place in the Silver Market that will likely lead to much higher prices in the coming quarters and years ahead...

It's official: The BRICS group of nations is set to introduce a new gold-backed currency at their highly anticipated upcoming summit in August. This news has sparked growing euphoria surrounding the potential of a gold-backed currency, leading to a surge in the entire precious metals complex, with many metals recording impressive double-digit gains in just the past few days. This exciting development could be just the beginning of a larger trend. As tensions with Western economies continue to escalate, Russia and other BRICS countries, including Brazil, India, China, and South Africa, are strategically working to reduce the dominance of the U.S. dollar. The announcement adds momentum to the "de-dollarization" movement, which has gained significant traction, particularly since the West imposed substantial sanctions on Russia after its invasion of Ukraine. The roots of the "de-dollarization" movement can be traced back to the period following the pandemic stimulus measures. The massive money printing progra...

Gold, silver, and PM (precious metals) stocks experienced a significant breakout as the value of the dollar declined, signaling the beginning of a major devaluation and the realization of its loss of reserve currency status. The BRICS nations are preparing to introduce their own CBDC (central bank digital currency) backed by gold, further contributing to the decline of the dollar. This development, although anticipated for some time, has finally caused the dollar to break down. The PM sector, along with commodities in general, is entering a strong and enduring upswing, still in its early stages. The decline of the dollar has been the catalyst for the recent breakout in the PM sector. Yesterday, the dollar index plummeted by a staggering 1.2%, breaking out of the bearish Pennant pattern it has been stuck in since late January. In contrast, the Canadian dollar, like many other currencies, has strengthened against the US dollar. This appreciation began in the middle of last month and is expected to benefit C...

Why Gold Continues to Outperform: Defying conventional economic reasoning, gold has maintained its value and even surpassed the performance of stocks and bonds. Despite its role in practical applications such as jewelry and dentistry, gold's supply remains substantial? One would expect a surplus to result in a significant drop in gold prices, but that has not been the case. Looking at historical data, it becomes evident that incorporating gold into investment portfolios has proven beneficial, particularly for retirees and those saving for retirement. Over the past century, a balanced portfolio with gold has yielded higher average returns, lower volatility, and fewer periods of stagnant growth compared to portfolios without gold. This trend has persisted in recent years, despite gold's decreasing relevance in today's financial landscape. Analyzing data from the NYU Stern School of Business, which tracks asset values dating back to 1928, reveals that a portfolio consisting of 60% stocks, 30% bonds, and 10% ...

Cities are not immune to decline, as their fortunes are tied to the availability and affordability of resources. Over the course of history, cities have risen and fallen based on economic factors and the balance between costs and benefits. While cities have traditionally offered opportunities and excitement, they have also faced challenges such as overcrowding, unsanitary conditions, and hazards. The rise of cities can be attributed to agricultural surpluses enabling specialized labor, leading to increased productivity, trade, commerce, and the development of government services and cultural institutions. However, cities have also been plagued by infectious diseases, conflagrations, and crime, which necessitated constant influxes of new residents to offset high mortality rates. As economies transitioned to industrialization and later to post-industrial knowledge-based economies, the functions and costs of cities evolved. The expansion of financialization and globalization favored certain cities, while com...

They aren’t hiding the fact that the climate change agenda is part of the “Great Reset” agenda anymore. Government leaders and think-tank power brokers convened at the Summit for a New Global Financing Pact in Paris, aiming to tackle poverty and reduce planet-heating emissions. However, the discussions quickly veered toward international centralization of power and the formation of a global consortium. The convergence of narratives reveals a concerning shift, with central banks and international institutions prioritizing carbon taxation and global warming over pressing issues like stagflation and economic collapse. This suggests that the climate change agenda is now openly intertwined with the "Great Reset" agenda. French President Emmanuel Macron advocated for a "public finance shock" to combat global warming and promote equity among nations, criticizing the current system's inability to address global challenges. The narrative of weather disasters intensified by global warming was emphasized, despite la...

Quantitative Tightening (QT) has had a negative impact on the Federal Reserve's balance sheet, with reserves and reverse repurchase agreements (RRPs) declining by a combined $865 billion from their peak levels. This reduction in liquidity is a concerning trend. Reserves, representing cash held by banks at the Fed, have dropped, and the decline amounted to $664 billion in Treasury securities and $202 billion in mortgage-backed securities (MBS), totaling $868 billion for QT. On the other hand, currency in circulation has reached a new record high of $2.34 trillion. Reverse repurchase agreements (RRPs) with foreign official accounts decreased by $56 billion from their peak in January 2023, while overnight RRPs decreased by $547 billion from their peak in September 2022. RRPs serve as liabilities for the Fed as cash owed to counterparties. The government's checking account, known as the Treasury General Account (TGA), has experienced fluctuations due to factors such as tax receipts and deficit spending. The T...

Social Security and Medicare are facing a bleak future, and our politicians lack the courage to address the impending crisis. The reality is that there are not enough working individuals to support the growing number of elderly people who are living longer. Both Social Security and Medicare are on the verge of bankruptcy, yet our leaders avoid discussing the issue. France's president had to raise the retirement age to save their pension system, which caused widespread protests. In America, any politician who suggests necessary solutions is met with opposition from misinformed seniors who believe their retirement funds should be untouchable. The truth is that Social Security is not individuals' own money; it relies on contributions from younger generations. When Social Security was established, it made sense because the average life expectancy was much lower. However, now that Americans live longer, the system is strained, and there aren't enough workers to sustain it. Politicians refuse to share this deva...

As the saying goes, there's no place like home. And more and more countries think that's the case when it comes to their gold. In this episode of the Friday Gold Wrap, host Mike Maharrey talks about why many central banks and sovereign wealth funds are bringing their gold home. He also talks about gold's performance through the first half of 2023 and the June CPI data.

The latest US Budget Deficit report reveals alarming trends in government finances. In June, government outlays skyrocketed by 15% to $646 billion, while tax receipts dropped by 9.2% to $418 billion compared to the previous year. This resulted in a nearly tripled budget deficit of $228 billion, exceeding the consensus estimate of $175 billion. Furthermore, the cumulative deficit for the fiscal year is already the third-highest on record, reaching $1.393 trillion, an increase of 170% from the same period last year. Amidst these financial struggles, the Federal Reserve's expansionary monetary policy has only worsened the situation. With the central bank injecting trillions of dollars into the economy and keeping interest rates near zero for an extended period, inflationary pressures have intensified. However, the most shocking revelation lies in the interest payments on the growing debt. Within just nine months of the fiscal year, the US has accumulated a record $652 billion in gross debt interest, represen...

Inflation may be on the decline, but it doesn't mean that prices are going down. The Consumer Price Index shows a 3% increase from June 2022 to June 2023, but it's important to note that the formula used to calculate inflation has changed over time. If we still used the methodology from 1980, inflation would be in the double digits. While it's good news that prices are rising at a slower rate, the reality is that the cost of living continues to burden average Americans. Many families are cutting back on everyday items like toothpaste and toilet paper. The demand for cheaper brands and budget stores is rising, impacting manufacturing giants and benefiting discount retailers. The financial stress is evident, with surveys showing that over 60% of the population is living paycheck to paycheck. Back-to-school spending is projected to decline for the first time in nine years, reflecting the struggles caused by inflation. Housing affordability is also a major concern. Even a middle-class income is no longer suff...