Precious metals news

ANZ Bank economists report that the transition to renewable energy is driving an unexpected demand for Silver, a metal not traditionally associated with renewables. The solar industry, in particular, relies on Silver for its high electrical conductivity and durability. As China's solar capacity rapidly expands and industrial demand for Silver from solar increases, the market may face supply challenges. Silver production is closely tied to other metals, and scrap supply is lagging. While above-ground inventories are still sufficient, they have significantly decreased in recent years.

Several U.S. states still impose sales taxes on the purchase of precious metals like gold and silver, but there is a growing movement to exempt them. Mississippi recently passed a bill exempting gold, silver, platinum, and palladium coins and bars from sales tax, joining other states like Virginia, Tennessee, Ohio, and Arkansas. New Jersey and Wisconsin are considering similar exemptions. The arguments against taxing precious metals include their constitutional status as money, the lack of sales taxes on stocks and bonds, and the fact that they are held for resale or exchange. Despite some opposition and partisan issues, progress is being made in the fight for sound money at the state level.

The Keynesian bedrock of modern economics, relying on financial repression and government spending funded by debt, is an artifact of favorable conditions that are now reversing. Factors such as abundant and affordable energy, favorable demographics, untapped natural capital, and globalization have reached their limits. The cost of debt is rising faster than the tepid growth it generates, and speculative credit-asset bubbles are becoming unsustainable. The Keynesian fantasy is coming to an end, and the risks and costs of rising debt cannot be ignored. The collapse of this unsustainable model is looming, and individuals should prepare accordingly by reducing their exposure to risk through self-reliance.

Under the economic policies of Bidenomics, characterized by massive federal spending and soaring inflation, the top-down approach resembles a Soviet-style command economy. As the Federal Reserve grapples with the challenges posed by Bidenflation, the 30-year mortgage rate has surged to 7.31%, a stark contrast to the 2.88% rate observed at the beginning of President Biden's term. This represents a significant 154% increase in the 30-year mortgage rate under the influence of Bidenomics.

Under Bidenomics, auto loan rates have surged to 7.65%, marking a staggering 166% increase. Average monthly payments have reached a new high of $733, compared to $730 in the first quarter and $678 in the second quarter of 2022. Shockingly, 2 out of every 3 consumers with monthly payments over $1,000 had an average APR between 8.5% and 9.6%. These developments reflect the strain on America's middle class and low-wage workers, highlighting the detrimental impact of current economic policies.

Focusing on the alarming state of the auto sector and its implications for the US economy. The data suggests that the auto industry is approaching a critical point, indicating an imminent auto loan crisis and signaling a forthcoming recession. Americans are increasingly relying on debt to afford skyrocketing car prices. Recent developments, such as a significant increase in new car loans and unprecedented spikes in auto loan rates, further contribute to the precarious state of the industry. The situation is likened to the fictional character Wile Coyote reaching a point of no return, emphasizing the severity of the issue.

This alarming story highlights the disturbing reality of how Americans have neglected to read and understand their own Constitution, including the Bill of Rights. It exposes the government's rampant disregard for citizens' rights, with a growing list of abuses that violate the Constitution. The government continues to restrict free speech, target whistleblowers, infringe on the right to self-defense, conduct invasive searches, incarcerate citizens unjustly, seize private property, and undermine due process. The story portrays a bleak picture of a government that has usurped power, leaving citizens vulnerable to militarized police, surveillance, and mass detention centers. It serves as a stark reminder of the erosion of liberty and the urgent need for Americans to reclaim their rights and protect themselves against government overreach.

Job market craters as layoffs increase, particularly in the tech sector attributing cuts to inflation. PPP loans intended for small businesses favored large corporations. Share buybacks benefit major players while the economy appears illusory. Infrastructure funds face delays and lack of disbursements. Data accuracy and manipulation raise concerns.

The Federal Reserve's actions have primarily focused on saving big New York banks, leading to banking crises and an insolvent system. Its current policy of raising interest rates exacerbates the situation. The Fed's creation caused inflation, depression, and recession, with the value of the US dollar significantly declining. Blaming insufficient demand for the Great Depression led to the rise of one-dimensional macroeconomics. The Fed's fight against inflation hampers employment and output, while the current inflation is supply-side. The high-interest rate policy frustrates homebuyers, businesses, and investors without serving any good purpose.

The possibility of a global recession grows as interest rates continue to rise, with warnings stemming from events like the gilt crisis, the collapse of Credit Suisse Group AG, and various US bank failures. Several rate-sensitive sectors, such as commercial property and utilities, show signs of instability. However, the most significant damage is occurring in areas like small- and medium-sized enterprises and the housing rental market. The aim of central banks to manipulate the labor market through rate adjustments is misguided, as labor markets are difficult to micromanage, and reaching the tipping point may result in a swift downturn that is challenging to prevent.

German industrial production unexpectedly dropped by 0.2% in May, raising concerns about a prolonged economic downturn. The decline was mainly attributed to a significant decrease in pharmaceuticals, overshadowing any gains from increased vehicle production. Chief economist Carsten Brzeski warns that the poor outlook, lack of orders, and ongoing challenges such as the conflict in Ukraine and the transition to green energy are contributing to Germany's stagnant industrial sector.

Gold extended gains on Friday following weaker U.S. nonfarm payrolls numbers, raising doubts about future interest rate hikes. Spot gold rose 0.4% to $1,918.62 per ounce, while U.S. gold futures increased 0.5% to $1,924.30. The decline in U.S. Treasury yields and a slip in the dollar further supported gold's positive momentum. Traders remained cautious about additional rate hikes beyond this month.

Despite doing nothing at the June meeting, Federal Reserve officials continue to talk tough about fighting inflation. The anticipation of another rate hike created headwinds for both stocks and gold this week. But Friday Gold Wrap host Mike Maharrey thinks something is amiss. In this episode, he talks about the disconnect between the central bankers' rhetoric and their actions. Are they clueless or running scared? This week, he also talks about another big jump in the national debt and the latest on central bank gold buying.

The Federal Reserve's total assets declined by $87 billion in June and have dropped by $667 billion since the peak in April 2022, marking the fastest 15-week decrease ever recorded. This reduction in assets reflects the ongoing Quantitative Tightening (QT) and the unwinding of bank liquidity support measures. The current balance sheet stands at $8.298 trillion, its lowest level since August 2021.

The average rate on the 30-year fixed mortgage soared to 7.22%, the highest point since early November. This surge was triggered by the substantial increase in the yield on the 10-year Treasury, which followed a much stronger-than-expected employment report from ADP. Adding to the negative trend, Federal Reserve Chairman Jerome Powell's comments indicating a possible continuation of interest rate hikes further contributed to the rise. In just one week, the 30-year fixed mortgage rate jumped by 31 basis points, leading to an increase in monthly payments for homebuyers. For instance, for a $400,000 mortgage, the monthly payment of principal and interest rose from $2,637 to $2,720 within a week.

The latest jobs report from the Bureau of Labor Statistics (BLS) fell short of expectations, with June payrolls showing a modest increase of 209,000 jobs. This figure represents a significant drop from the previous month's higher-than-expected print of 339,000 jobs, which was subsequently revised down to 306,000. It is the lowest number of jobs added since December 2020. The miss in job growth was the first since April 2022, following a streak of 13 consecutive beats. Moreover, there were downward revisions to job numbers for both April and May, with a combined total of 110,000 fewer jobs reported than previously estimated. These revisions indicate a trend of downward adjustments to employment figures throughout the year 2023.

China's recent move to impose export restrictions on minerals used in various industries serves as a stark reminder of its control over global mineral resources. This action not only demonstrates China's dominance but also signifies its willingness to wield this power in its ongoing rivalry with the United States. It highlights the potential disruptions it can create in Western supply chains. The restrictions specifically affect minerals crucial for semiconductors, solar panels, and missile systems. This development serves as a warning of China's strategic leverage in the global mineral market.

China continues to bolster its gold reserves, extending its streak of consecutive monthly purchases to eight. The People's Bank of China added 680,000 troy ounces of bullion in the previous month, equivalent to 23 tons, bringing the total stockpile to 2,330 tons. This consistent buying reflects China's efforts to diversify its holdings and reduce reliance on the US dollar amid economic and geopolitical risks. Central banks worldwide have been increasing their gold purchases, with a quarter of them planning to further expand their holdings in the coming year. Additionally, China's foreign currency reserves grew to $3.193 trillion by the end of June, signaling its continued focus on strengthening its financial position.

Chinese President Xi Jinping has issued a negative and concerning directive to the military, urging them to deepen war and combat planning. He emphasized the need to increase the chances of victory in actual combat, highlighting a perceived unstable and uncertain security situation. Xi's comments, made during an inspection tour of the Eastern Theater Command, focused on safeguarding China's sovereignty and territory. This renewed call for military readiness comes at a time when tensions with the United States are high, as U.S. Treasury Secretary Janet Yellen arrived in Beijing for talks aimed at easing tensions between the two nations. The directive underscores China's aggressive stance and its determination to assert control over regions such as the Taiwan Strait and the South China Sea, despite international concerns.

U.S. Treasury Secretary Janet Yellen's visit to Beijing turned into a scathing critique of China's economic practices. Yellen wasted no time in calling for market reforms and openly criticized China for its recent harsh treatment of U.S. companies and implementation of export controls on critical minerals. Yellen's intention to repair the strained U.S.-Chinese relations quickly turned into a confrontational stance. In her public remarks, she made it clear that Washington and its Western allies will not hesitate to retaliate against what she deemed as China's "unfair economic practices."