Precious metals news

Investors have no idea how the ENERGY CLIFF is already impacting the cost of producing gold.  The world's largest gold mining company is struggling to remain profitable as the production costs have surged over the past five years, much higher than energy price inflation...

If geopolitical tensions avoid major oil regions, the Fed's current high-rate stance may dampen gold's safe-haven demand temporarily. However, as the Fed eases its policy, central banks continue their robust gold purchases, and the U.S. dollar weakens, expect gold to surge past $2,100 with strong momentum.

The Retail Apocalypse: Post-pandemic, American storefronts remain empty, not just due to COVID-19 but banking rigidity. Banks control retail rents, stopping landlords from adjusting them to market demands. This results in long-lasting vacancies despite the potential for lower rents to attract tenants. Landlords are trapped by bank-imposed financing terms that discourage leasing to anyone but 'credit tenants' like national chains. The financial system is failing cities, prioritizing empty spaces over vibrant communities.

Lending for commercial real estate has nosedived amid rising interest rates, marking a grim period not seen since 2011. Banks are pulling back, debt markets are stagnant, and property values are under scrutiny. This pullback in lending is hitting all sectors, especially offices, with refinancing becoming costlier and new developments stalling. The market is facing its most significant challenges since the 2009 downturn, with recovery prospects bleak.

Sky-high mortgage rates and soaring home prices are plunging the U.S. housing market towards recession. With borrowing costs at a 20-year peak and affordability crumbling, Wells Fargo warns of a bleak future akin to the troubled 1980s. Demand is drying up, construction is stalling, and the once resilient market faces a prolonged downturn.

Central banks around the globe have aggressively ramped up their gold reserves this year, purchasing a staggering 800 tons in the first nine months, including substantial amounts of unreported buying. Notably, China, Poland, and Singapore have been leading this charge. This surge in central bank demand has been a key pillar supporting gold prices against the headwinds of global monetary tightening, with the precious metal peaking over $2,000 an ounce. As geopolitical tensions rise and inflation concerns loom, gold's allure strengthens, inching it closer to its all-time high record.

Consumer confidence plunges continuously, hitting a new low since May, as inflation fears and political instability rattle households across all ages and incomes. Rising grocery and gas prices, higher interest rates, and Middle East turmoil feed the gloom. Despite steady job availability, the overall outlook is bleak, with soaring inflation expectations and a persistent belief that a recession looms. Meanwhile, business conditions worsen, evidenced by Chicago PMI's contraction—the longest since the early 2000s—underscoring the grim economic landscape under current policies.

IRS Commissioner Danny Werfel faces tough questioning over potentially breaking a pledge by auditing Americans earning under $400,000, risking the agency's integrity and fueling concerns that the IRS will disproportionately target lower earners in its enforcement ramp-up. Despite previous assurances, a watchdog warns the lack of a clear "high-income" definition could ensnare those with lesser incomes in the agency's dragnet, potentially contradicting promises and undermining taxpayer trust.

Stanley Druckenmiller blasts Treasury Secretary Janet Yellen for a colossal oversight in not locking in low rates with long-term bonds amid the pandemic, a move he brands as arguably the worst Treasury blunder ever. As a result, he predicts a grim future where soaring interest costs strangle the federal budget, dwarfing discretionary spending and burdening generations to come with unsustainable debts.

Under Bidenomics, the rich get richer, and the middle class suffers with unaffordable housing—median income at $78,000 can't keep up with the $111,000 needed to buy a home. Credit card delinquencies are the highest in over three decades, and the interest on the national debt for 2023 matches the entire debt from 1980. Investments faltered in 2022, and while Bitcoin, NASDAQ, and gold are up in 2023, Treasuries and REITs lag with losses over -10%.

The financial strain on American households is intensifying, with 62% living paycheck to paycheck amidst relentless inflation and rising interest rates. Despite static income levels, the cost of necessities is forcing many to defer essential spending and deplete savings, with 49% reporting lower reserves than a year ago. Economic indicators suggest a grim outlook, with real earnings declining and the Federal Reserve signaling rates will remain high, exacerbating the financial distress for the majority already in a precarious position.

Discover the incredible insights shared by Tavi Costa in this thought-provoking discussion about the gold market.

The Federal Reserve is in a dire situation, grappling with an economy battered by persistent inflation and volatile markets. Despite economic growth, the specter of unyielding inflation persists, casting a long shadow over the Fed's ability to manage a soft landing. With investor nerves frayed and borrowing costs soaring, the risk of tipping into a deep recession looms larger, questioning the efficacy of the Fed's toolkit in this fraught economic landscape.

Rising interest rates are pushing middle-class Americans to the brink, with a Harris Poll for Bloomberg highlighting deeper anxieties. Higher borrowing costs have hit 57% of families, with credit card interest and fees alone costing a record $130 billion last year. Groceries and utilities add to the squeeze, as households feel increasingly left behind with stagnant wages failing to keep up with surging costs. Economic optimism dwindles as the middle-class struggles become a stark reality.

Wall Street banks predict the U.S. Treasury's massive borrowing needs will continue, with estimates of $1.5 trillion needed through early 2024, exacerbating the steep increase in long-term yields to the highest since 2007. This borrowing surge is straining the Treasury market and poses sustainability concerns, with Treasury yields peaking and stocks closing lower amid ongoing financial stress.

After setting a record through the first half of the year, central banks continued to gobble up gold in the third quarter.
Globally, central banks added a net 337 tons of gold in Q3, the second-highest third-quarter total on record behind 2022.
Through the first nine months of the year, central banks bought a net of 800 tons of gold. That's 14% more than through the same period in 2022.

Does the massive national debt matter?
A lot of people don't think it does, at least not yet. They point to Japan as an example of a country that has a much higher debt-to-GDP ratio and is doing fine. Peter Schiff said they're looking at the wrong country. The US is more like Argentina than Japan.

Central banks purchased the most gold over the past year, as the U.S. and ECB printed trillions in new treasuries and bonds.  It seems as if many central banks are becoming worried that U.S. Treasuries may no longer be safe assets in the future.  I agree...

Amid Middle East tensions and European recession fears, spot gold prices soared over 10% in a month, from $1,815 to around $2,000 per ounce, the highest since May 2023. Bloomberg's Mike McGlone suggests gold could potentially reach $3,000 by 2024, especially if the anticipated US recession hits by year-end. Contrarily, US equities are facing a sell-off, with expectations of a brief rally before a continued bear market into 2024.

Renaissance Macro Research warns of a triple threat to the US economy: escalating debt, rising interest rates, and protectionist trade policies. These factors are expected to shape the economic and investment climate for years, with the federal debt at $33 trillion and interest rates increasing the cost of government debt. Protectionist measures could further strain the economy by raising costs and fostering dependency on government aid.