Precious metals news

President Biden attributes high prices to greedy businesses, overlooking the impact of the Federal Reserve's monetary policy and the fiat money system since 1971. Critics argue that the real cause of widespread price increases is the Fed's policies, not consumer spending or business practices. The devaluation of the dollar encourages immediate spending over saving, further exacerbating inflation. Despite nominal wage increases, real wages decline, with gold seen as a more stable value. The solution proposed is for Congress to reduce spending and reform the Federal Reserve.

Why do virtually all the mainstream pundits think the Federal Reserve has won the inflation fight?
Maybe it’s just wishful thinking. They want the Fed to win so it can go back to what it does best – creating more inflation with artificially low interest rates and quantitative easing.
Regardless, most of the mainstream punditry hyped the November CPI report as more positive news on the inflation front. The CNBC headline reflected the consensus - inflation "slowed" last month.
Except it really didn't.

It was great chatting with Jesse from Commodity Culture on why the Energy Cliff will be BAD NEWS for financial assets.  Unfortunately, the market doesn't understand this as they continue to purchase a record amount of U.S. Treasuries and global bonds of all flavors...

Gold is quietly regaining importance in the global monetary system, driven by central banks' declining trust in the dollar and losses from rising interest rates affecting bonds. European central banks may use gold reserves to address balance sheet losses, avoiding the need for government recapitalization.

The Bom Jesus, a Portuguese ship lost in 1533, was found in Namibia's desert in 2008 with two thousand pure gold coins and tens of thousands of pounds of copper ingots, marking a significant archaeological discovery. It likely sank near Namibia's coast during a storm, later emerging in the desert as coastlines receded.

Secret Santas in various U.S. cities are spreading holiday cheer by generously donating to the Salvation Army's red kettles. Shoppers encounter these kettles while seeking gifts, with volunteers braving diverse weather to collect donations. In Indiana, Vermont, and Michigan, volunteers were delighted to find rare gold coins worth approximately $2,000 in the kettles, a pleasant surprise from anonymous donors.

US Senator Elizabeth Warren's bill targeting illicit cryptocurrency use gains support from five more Democratic senators, bringing the total co-sponsors to 19. The bill seeks to enhance anti-money laundering regulations in the crypto space.

The US government's debt has surged alarmingly, rising by 50% in just four years, from $22.72 trillion in 2019 to $33.8 trillion currently. This growth outpaces GDP, pushing the debt-to-GDP ratio to a staggering 122%. Government spending far exceeds tax revenues, leading to increased borrowing and escalating interest payments, which are projected to reach nearly $1 trillion. This unsustainable trajectory of deficit spending signals looming fiscal and economic crises, demanding immediate attention and preparation.

In this eye-opening conversation, Mike Maloney and guest Rick Rule dissect the hidden impacts of taxes on American households, challenging conventional views on inflation.

Federal budget projections indicate persistent $1 trillion+ deficits annually through 2033, suggesting the U.S. may never see a deficit below $1 trillion again. In the first quarter of 2024 alone, the U.S. Treasury anticipates borrowing an additional $816 billion, primarily for deficit spending, underscoring the rampant nature of current fiscal policies. This trend highlights a significant and ongoing challenge in controlling the national deficit.

Paul Dietrich of Briley Wealth predicts a severe US recession in early 2024, citing historical precedents where significant stock market gains, like those seen this year, preceded economic downturns. He references the patterns observed before the recessions of 2001, 2008, and 2020, where stock rallies were followed by sharp contractions. Dietrich also notes weakening labor market signals, including rising unemployment claims, which further support the likelihood of an impending recession.

In a recent interview with Forbes, economic commentator and historian Jim Grant warned that we haven't fully felt the inevitable fallout from the "free money era."
I think that the consequences of more or less 10 years of proverbially free money are going to play out in the credit markets.”

Jeffrey Gundlach forecasts a bleak economic outlook, with bonds favored over stocks due to growing banking anxieties, and anticipates a significant decline in house prices. He expects a recession to emerge by summer, exacerbated by high mortgage rates and a shift from bank deposits to safer money-market funds. Additionally, Gundlach points to the alarming risk of soaring national debt payments, which could strain federal finances. Key indicators, including an inverted yield curve and negative economic data, further reinforce his prediction of a deepening economic downturn.

The middle class faces significant challenges in the housing market, highlighted by a substantial increase in mortgage payments. According to The Wall Street Journal, the average monthly new mortgage payment has risen 86%, from $1,787 to $3,222. This increase is due to a 33.2% rise in home prices and a 181% surge in the 30-year mortgage rate, significantly impacting housing affordability.

November's CPI saw a slight 0.1% monthly increase, with a year-over-year rise of 3.1%, indicating persistent inflation. Core CPI services excluding shelter rose sharply, challenging the Federal Reserve's path towards rate cuts. Significant increases in used car prices and steady shelter inflation suggest ongoing price pressures. The overall consumer price index has surged 17.5% since President Biden's term began, reflecting a concerning inflationary trend. This situation complicates the Federal Reserve's decision-making on future rate adjustments.

Most mainstream pundits characterized the November jobs report as a "Goldilocks" report. Job growth was strong enough to support the "soft landing" narrative but not so strong it might scare the Fed into raising interest rates again.
President Joe Biden used the report to boast about his economic achievements. But according to Peter Schiff, Biden doesn't have anything to boast about. He talked about it during a recent interview on the Capitol Report on NTD News.

In a 2002 speech, Ben Bernanke, then a US Federal Reserve governor, emphasized the dangers of deflation in modern economies. This warning is particularly relevant for China today, as it faces a unique challenge of deflation, unlike most major economies still combating inflation. China's gross domestic product deflator has fallen to -1.4%, showing contraction for two consecutive quarters, leading to a nominal GDP growth of just 3.5% in the third quarter, significantly lower than the US's 6.4%.

The European Central Bank, after halting its aggressive interest rate hikes in October, faces investor pressure to reduce borrowing costs. At its upcoming meeting in Frankfurt, the ECB is anticipated to maintain current rates, despite eurozone inflation nearing the 2% target. The central bank is expected to counter market expectations for an early rate cut, emphasizing ongoing concerns about price increases, particularly from rising wages.

Wall Street anticipates Tuesday's consumer price index to assess the disinflation trend before the Federal Reserve's decision on Wednesday, where rates are expected to hold steady. The key focus will be on the Fed's response to the market's dovish expectations and the potential impact of its economic projections and press conference on market dynamics.

The Fed is expected to hold rates steady this week. Wall Street will be watching for any signs that the most aggressive rate-hiking campaign since the 1980s is now over. Wilmer Stith of Wilmington Trust indicates no further Fed funds rate hikes are expected, with the focus now on maintaining the current 5% rate. Inflation is nearing the Fed's 2% target, and while some officials consider additional hikes, Fed Chair Jerome Powell is likely to maintain a cautious stance on rate changes.