Precious metals news

Peter Schiff recently appeared on the Claman Countdown with Creative Planning president Peter Mallouk to talk about the recent record high in gold and the trajectory of the markets over the next few months.
Mallouk is bullish on the stock market, but Schiff makes the case that this is gold's day.

The prevailing belief that government debt is a "free lunch" due to low interest rates is being challenged as interest rates rise. This shift highlights the risks of high government debt, including increased interest payments and inflation. The assumption that interest rates would remain low indefinitely is proving incorrect, forcing a reevaluation of fiscal policies and the real costs of debt.

(Global bond markets are surging due to expectations of central banks, like the ECB and the Federal Reserve, easing monetary policies next year amidst reducing inflation concerns. Investors are now betting on potential rate cuts starting as early as early 2024, leading to a significant bond rally as the year concludes. This marks a notable shift from earlier hawkish stances.

In China's Sichuan Province, archaeologists have unearthed over 70,000 artifacts from the 17th century, including gold and silver, linked to the warlord Zhang Xianzhong. His sunken treasure, a result of a failed rebellion against the Ming Dynasty, has been discovered in the Min River. The finds from Zhang's fleet, including significant historical and cultural relics, offer insights into the era's social turmoil and Zhang's controversial rule. This discovery aligns closely with historical accounts of that tumultuous period.

In October, central banks globally added a net total of 42 tonnes to their gold reserves, continuing a robust buying trend. The People’s Bank of China was the largest buyer, significantly increasing its reserves, followed by the Central Bank of Turkey and the National Bank of Poland. Despite higher sales volumes from countries like Uzbekistan and Kazakhstan, the overall trend of strong central bank gold buying remains unaltered, reinforcing gold's positive outlook in the global market.

Gold reached a new record high of $2,111, buoyed by its status as a traditional safe-haven asset and expectations of U.S. rate cuts. A weaker dollar has also made gold more attractive to non-dollar buyers. Notably, non-aligned and BRICS nations have been increasing their gold reserves while selling off U.S. treasuries. Gold's long-term performance, its 3000% rise over the last 50 years compared to stocks, and its resilience during financial instability make it a compelling component of a diversified portfolio. With ongoing geopolitical tensions, rising national debts, and political uncertainties, gold's role as a stable, decorrelated safe-haven investment is more relevant than ever in today's uncertain financial landscape.

U.S. service sector activity showed a slight uptick in November, yet hiring significantly slowed, marking the weakest employment growth since October 2022. Businesses are cutting costs by reducing hiring, hinting at a potential downturn in November's job numbers. Upcoming labor reports are anticipated to reflect this slowdown, with modest payroll increases and a steady unemployment rate. The surv

Agility Robotics' upcoming RoboFab facility in Salem, Oregon, set to mass-produce humanoid robots, signals a worrying trend in automation. With plans to produce 10,000 robots annually, this development underscores concerns about the increasing replacement of human labor in warehouses and other industries. China's similar ambitions to mass-produce humanoid robots by 2025 further highlight a global shift towards automation that could have significant negative implications for employment and job security.

The U.S. economy's reliance on Federal Reserve money printing is evident in the job market. According to the U.S. Bureau of Labor Statistics, job openings decreased to 8.7 million as of the end of October, with hires and separations remaining relatively stable. A notable correlation exists between the Fed's balance sheet and job openings: as the Fed expanded its asset purchases in 2021 and 2022, job openings increased. However, with the Fed beginning to reduce its balance sheet, job openings started to decline, suggesting a dependency of the job market on the Fed's monetary policy.

Henry Kissinger's recent passing highlights his role in creating the 1974 "Petrodollar Accord," stabilizing the U.S. dollar by tying oil sales to it. However, this system faces challenges as BRICS nations and others move away from dollar-based trade, potentially weakening the dollar's global position. With these shifts, investing in gold could be a strategic response to anticipated changes in the global monetary system.

The risk of a global recession is escalating, marked by increasing economic warnings and financial instability. Analysts like Lance Roberts highlight key recession indicators, including yield curve inversions and Federal Reserve actions. Manufacturing surveys and the Fed's Beige Book report further indicate a downturn, with declining activity in key sectors. These factors collectively point toward a looming deep recession in the global economy.

In this eye-opening video, we delve into the ominous signs pointing towards the biggest economic disaster in history.

Silver is currently underpriced, with the silver-gold ratio over 81-1. Historically, the ratio has averaged between 40:1 and 60:1. Silver demand is expected to nearly double over the next decade, particularly in solar energy and electric vehicles. The 2022 silver demand set records in every category, while supply remained flat. The price of silver does not reflect the growing supply deficit and future demand.

The U.S. bond market recently faced stress due to a spike in demand in the repurchase agreement (repo) market, causing overnight repo yields to exceed 5.50%. This situation, reminiscent of the September 2019 market disruptions, occurred when a shortage of bank reserves and increased government borrowing led to spiked financing rates, prompting Federal Reserve intervention.

Mohamed El-Erian from Allianz suggests the U.S. Federal Reserve is facing challenges in effectively communicating its interest rate strategy. He believes the markets are wrongly anticipating imminent rate cuts and that the Fed might tolerate higher inflation rather than risking a recession. El-Erian emphasizes the Fed's credibility issue and proposes that it may need to accept slightly higher inflation rates due to post-pandemic economic changes.

Euro zone business activity experienced a lesser downturn last month, but still suggests an economic contraction this quarter. The dominant services sector is facing challenges in generating demand, as indicated by recent survey findings.

Central banks gobbled up gold over the summer and the buying spree has continued into the fall.
Globally, central banks added another net 42 tons of gold to their reserves in October.

The Bank of England's plan for a digital pound could heighten the risk of bank runs and failures, as it allows for faster withdrawals during financial instability. The move may also lead to increased borrowing costs, as banks face higher funding costs. MPs have raised concerns about potential data misuse and the adverse impact on those reliant on physical cash. The need for clear evidence of the digital pound's benefits without escalating risks is emphasized.

Moody's Investors Service has lowered China's sovereign credit rating outlook to negative due to concerns over prolonged economic slowdown and challenges in the property sector. This change reflects the increasing financial support from the government to weaker regions, posing risks to China's overall fiscal and economic stability amidst broader economic challenges.

China faces a significant financial time bomb risk due to its banking system's exposure to a substantial amount of hidden debt, accumulated by cities and provinces through years of unchecked borrowing. Estimates by the International Monetary Fund and Wall Street banks place this off-balance-sheet government debt between $7 trillion and $11 trillion. This debt largely comprises corporate bonds issued by local-government financing vehicles for infrastructure projects and other expenditures.