Precious metals news

M2 money supply is enduring its first meaningful drop in 90 years. A rarity with only five such occurrences in history, is sounding alarms for a potential economic downturn. With a 3.17% year-over-year drop and a more significant fall since July 2022, this contraction in available capital hints at reduced consumer spending and possible deflationary pressures. Historically, similar declines have preceded severe depressions and high unemployment. While modern monetary policy may mitigate some risks, the current shrinkage in money supply poses a stark threat to the economy and stock market stability.

Amid a global economic slowdown signaled by China's faltering exports, oil prices have plunged over 4%, with the world's largest oil consumer pulling back on imports. This drop reflects deepening concerns of a widespread demand collapse, overshadowing OPEC+'s production cuts. Suspicions of Russia exceeding export quotas add to the market's unease, while a stronger U.S. dollar further depresses oil prices, intensifying the gloom enveloping the global energy sector.

Mario Draghi, the former ECB head, has painted a grim picture of the Eurozone's future, forecasting an almost certain recession by the end of 2023. Meanwhile, ECB Governor Pierre Wunsch's admission of looming stagflation points to a deeper economic malaise. The Eurozone appears to be on a dismal trajectory towards not just recession but a potentially prolonged period of economic stagnation and financial distress.

Today's 30-year Treasury auction was an absolute debacle, with the worst tail on record since 2016 and the lowest bid-to-cover ratio since December 2021. Indirect (foreign) participation plummeted, leaving dealers to absorb nearly a quarter of the offering, signaling distress and hinting at imminent Federal Reserve intervention. This fiasco sent shockwaves across financial markets, causing Treasury yields to soar, stocks to plunge, and the dollar to surge, all amidst crumbling Treasury liquidity. The Federal Reserve faces a significant challenge ahead.

The U.S. government's financial situation is bleak with soaring debt and entitlements that the nation cannot afford. Misguided policies have led to increased dependency, eroded personal responsibility, and put the country on a path to economic collapse. Defense spending inflates the budget without clear benefits, and the massive national debt, exacerbated by rising interest costs, is unsustainable. Without radical and politically unviable reforms, a fiscal implosion seems inevitable.

The US is heavily burdened by debt, with federal debt at $33.71 trillion and unfunded liabilities at a staggering $211 trillion. This implies severe future financial challenges, possibly resulting in more debt, higher taxes, or cuts in social benefits. Federal debt costs are escalating as the government fights inflation. Additionally, consumer credit card debt has surged as people grapple with the rising cost of living.

Silver demand for industrial applications, jewelry production and silverware fabrication is expected to nearly double over the next 10 years.
According to a report by Oxford Economics commissioned by the Silver Institute, the demand in these three sectors is forecast to increase by 42% between 2023 and 2033.

Initial jobless claims in the U.S. slightly decreased to 217,000 last week, but the number of continuing claims has been rising for six weeks, reaching the highest since April at 1.834 million. This suggests underlying issues in the labor market. Goldman Sachs warns that seasonal factors could further inflate these numbers by 375,000 by March, indicating worsening conditions ahead.

Declining Treasury yields have spurred a short-term surge in stocks, but investors are increasingly anxious that this trend could backfire by encouraging the Fed to extend its aggressive rate policies. The worry is that persistently low yields might overly loosen financial conditions, compelling the Fed to keep rates high to prevent a resurgence in inflation. This could negatively affect asset values and sustain economic pressure. Such a scenario poses a tricky balancing act for the Fed, which could result in prolonged market turbulence and economic strain.

Bank of Japan Governor Kazuo Ueda signaled concern over raising interest rates, underlining the potential for severe market disruption and strain on the economy. Despite nearing their inflation target, the central bank faces a tough path ahead, with the looming threat of market instability and long-term low-rate repercussions adding to the grim outlook.

China's economy experienced deflation with a 0.2% drop in the CPI last month, largely due to a significant decline in pork prices. Producer prices continued to fall, marking a 13th consecutive month of declines. Weak domestic demand persists, challenging the government to further stimulate the economy amid mixed recovery signals.

US Treasury bond auctions are causing significant volatility in stock markets, with the S&P 500 showing about 1% swings on auction days. This effect is now greater than the market impact of employment data. Recent auctions, including a key 30-year bond sale, have shown weaker demand, raising concerns over high yields and their negative effect on stocks. Equity traders are alert to these auctions as critical indicators of market direction amidst uncertainty over Federal Reserve interest rate policies.

Mainstream financial network pundits and government officials keep telling us that the economy is chugging along because Americans continue to spend money. But it's clear that borrowing is the only thing sustaining this spending spree.
Meanwhile, the "resilient" American consumer is drowning under a surging tidal wave of debt.

Ken Griffin, Citadel's founder, foresees a period of global unrest and structural shifts leading to de-globalization and persistently high inflation, potentially lasting decades. He argues this environment will exacerbate the cost of the U.S. deficit, already inflated by unchecked government spending. Griffin criticizes this spending as reckless and unsustainable, noting that despite a strong job market, there's a pervasive unease among U.S. consumers. He cautions against the Federal Reserve's potential strategy of printing money to forestall default, stating it would have catastrophic economic results, sending the economy into severe decline.

Precious metals investors are still concerned about the rampant "Manipulation" of the Silver Market.  I decided to share where I believe the manipulation occurs in the silver market.  There is a great deal of fraud happening behind the scenes... but where??

Ronnie joins Mike to shed light on some new revelations that could signal a gold bull market on the horizon.

The ambitious goals of the green agenda to shift towards renewable energy, while challenging in terms of raw material acquisition, spotlight silver as a critical component. Every gigawatt of solar power necessitates substantial amounts of silver, estimated to be up to 21 metric tons. With silver production already failing to meet industrial and investment demands, the added pressure from renewable energy initiatives is poised to amplify silver demand by an additional three to fivefold. This presents a substantial growth opportunity for silver, underpinning a bullish outlook for its future pricing in the market.

With inflation appearing to peak and gold near record prices, some investors are hesitant to buy, waiting for a bigger price drop. Yet, as yields fall, a potential bullish reversal for gold and silver is on the horizon, especially as they hit key support levels. Silver, in particular, may have greater potential than gold, suggested by the stable gold-silver ratio, indicating silver might soon outperform gold.

AI advancements are predicted to significantly boost demand for precious metals, particularly silver, due to its essential role in electronics and the green energy sector. Although industrial gold demand has dipped, a resurgence driven by tech sector growth is expected next year. Silver, critical for its conductivity, faces supply challenges and could see a sharp increase in demand, further stressed by its use in solar energy production. Precious metals like platinum, palladium, and gold, integral to various AI chip components, are set for a demand surge in 2024 as AI technology proliferates.

Despite the seemingly inexplicable strength of the dollar amidst soaring U.S. debt-to-GDP ratios and relentless deficits, the reality is that the dollar's might is relative; its major competitors are floundering even more. Yet, the Eurodollar market's demand for short-term U.S. T-bills—requiring hefty dollar purchases—keeps the dollar afloat. However, don't be fooled by the dollar's robust facade. Gold, the true measure of currency value, is ascending. As gold prices climb, it's evident that gold is the prudent investor's choice. Under $2,000, gold is not just a bargain; it's the savvy hedge against a dollar whose apparent strength is a temporary phenomenon in a world veering towards fiscal recklessness.