Precious metals news

A mistakenly released document by the FDIC provides detailed information about Silicon Valley Bank's biggest customers who were bailed out by the Biden administration. The decision to backstop all deposits, including those above the federal insurance limit, benefited larger companies such as Sequoia Capital and Kanzhun Ltd. The FDIC requested that Bloomberg destroy the depositor list, but Bloomberg refused. The move to insure all deposits has sparked controversy, with critics arguing it created a moral hazard. The FDIC estimated the cost to taxpayers at $15.8 billion. The regional banking crisis is ongoing, and cash continues to flow out of banks into money funds.

A survey reveals what Americans would do to become debt-free: give up social media, spend a night on a remote island, or even go without internet access. However, the average person believes they can only stay debt-free for less than three months before accumulating new debt. Confidence in remaining debt-free is low, with rising living costs, unexpected expenses, and rising interest rates cited as reasons. Credit card debt, mortgages, automobile loans, and medical debt are the biggest hurdles. The average person has $54,767 of debt, with necessities outweighing "nice-to-haves."

Central bank digital currencies (CBDCs) pose risks to personal liberties and enable surveillance. China's social credit system, which denies travel based on low scores, is a real example. Similar systems could arise in the US. Censorship during the pandemic highlights government control. Combining social credit and a police state allows for severe punishment of dissenters. CBDCs facilitate this surveillance, but acquiring gold offers a non-digital alternative. Citizens must unite and resist this future.

The national debt recently blew past $32 trillion.
As we approach America's birthday on July 4, it might be a good time to consider what the founding fathers would have thought about this massive indebtedness.

China's silver demand continues to soar while its own production falls short, leading to a significant supply gap of around 3,000 tons that needs to be filled through imports. China's limited silver resource reserves raise concerns, with only 11 years of mining left before depletion by 2032. Mexico, the world's leading silver producer, also faces a dire situation, with reserves expected to vanish within five years. Other major silver-producing countries will experience resource depletion as well, leading to a global silver crisis by 2036. The impending silver shortage will impact industrial demand and create a panic among silver consumers worldwide. China, in particular, faces urgent challenges in securing silver resources to support its ambitious high-tech development plans. The global silver supply is projected to decline while demand continues to rise, exacerbating the resource crisis.

Despite hawkish remarks from Jerome Powell, gold retains its positive outlook. The Federal Reserve chairman's focus on inflation and potential rate hikes led to a temporary decline in gold and silver contracts. However, the Fed's true intention is to maintain a gradual depreciation of the dollar, rather than solving the inflation issue. Powell's concerns about de-dollarization demonstrate the importance of the dollar's reserve currency status. Gold remains a reliable measure of a currency's value, and its historical price increases indicate the declining purchasing power of fiat currencies. As central banks explore digital currencies, investors should be cautious as these currencies may face similar depreciation. Gold's long-term potential remains strong, with the possibility of reaching five-digit prices in the future.

Negative sentiment looms over the markets as the Fed asserts its power, potentially impacting AI stocks, tech giants, and Tesla. The Fed's pause on interest rate hikes has spooked investors, with expectations of further rate increases to tackle inflation. Central banks' surprises and the market's resilience are raising concerns. Goldman Sachs warns of downside risks, emphasizing the need for caution. Going against the Fed's actions is risky.

Government bonds rally while stock futures struggle as concerns grow over central banks pushing inflation-fighting measures too far. US Treasury yields drop, and Germany's benchmark yield tumbles as the business outlook deteriorates. Investors fear that aggressive rate hikes could harm fragile economies. Geopolitical tensions in Russia add to market uncertainty. Oil prices rise amid potential disruptions in global oil markets.

We tend to focus a lot on the Federal Reserve's interest rate policy, while the central bank's balance sheet stays in the background. But the balance sheet arguably has more impact on the economy over the long run.
Since the Fed began hiking interest rates in March 2022, it has also shrunk the balance sheet. But balance sheet reduction hasn't been aggressive. In fact, the decline in the balance sheet since the pandemic is like a drop of water in the ocean compared to the massive expansion we've seen since 2008.

US Treasury faces a looming wave of debt sales, pushing bond yields higher. The surge in longer-term issuance, estimated at over $1 trillion in 2023, will strain borrowing costs. With the Federal Reserve reducing its balance sheet and dwindling demand from traditional buyers, the Treasury may rely on price-sensitive buyers, leading to higher premiums and tighter financial conditions. Currency hedging costs and a strong US dollar deter global investors. The combination of increased supply and positive growth raises concerns about the buyer base. Excess global savings are dwindling as debt supply rises, signaling higher interest rate bills ahead.

Japan is concerned about the rapid weakening of the yen and is considering all options to respond. The government wants stable currency movements based on fundamentals. The Bank of Japan's easing policies and the U.S. Federal Reserve's tightening measures have driven up the dollar. Authorities are monitoring the situation closely and may intervene if necessary. Last intervention occurred in October when the yen hit a 32-year low. Excessive currency moves are seen as harmful to Japan's economy and the global economy. The focus is on the pace of the yen's movement. Investors are selling yen after the Bank of Japan's decision to maintain its stimulus.

China's consumer-driven recovery is losing momentum as spending slows on various fronts, including travel, real estate, and automobiles. Weak holiday travel spending and declining home sales indicate a fading recovery. Economists expect more stimulus as confidence weakens. Mainland stocks decline, reflecting concerns about the economy. Some positive indicators, such as record-breaking box office revenue, contrast with overall sluggish spending. Speculation about increased stimulus measures grows, but the scale is expected to be limited. S&P Global Ratings lowers China's 2023 GDP growth forecast due to an uneven recovery. The government may consider easing housing restrictions and mortgage requirements to boost consumption. Consumer confidence remains slow,.

BIS warns of critical point in global economy, urges more rate hikes to combat stubborn inflation. Banking collapses and high debt levels pose risks. Central bankers gather in Sintra as challenges mount. Uncertainty remains as companies seek profit growth and workers demand higher wages. Last mile of reeling in inflation expected to be difficult with potential surprises.

The global economy is facing a critical moment as tight labor markets drive wages and services inflation to uncontrollable levels, warns Agustin Carstens, head of the Bank for International Settlements. The ongoing cycle of interest rate hikes, although intense, is entering a challenging phase as inflation risks becoming deeply rooted. The Bank emphasizes that restoring price stability will be a difficult task, potentially requiring interest rates to remain elevated for an extended period, surpassing public and investor expectations.

Europe's bond markets ring recession alarms as tight monetary policies threaten economic growth. Yield curves invert, prompting investors to seek safety in long-dated bonds. Euro and pound weaken, while traders flock to the US dollar. Weak economic data fuels concerns. Long-maturity euro area bonds perform well. Risk of recession spurs demand for UK bonds, but pounds suffer. Yen emerges as a safe haven, and the US dollar gains support as a defensive asset.

The value of office buildings in New York City has plummeted by $76 billion, signaling a downturn in the commercial real estate sector. Rising interest rates, reduced credit availability, and the shift towards remote work have taken a toll on older office buildings and other real estate categories. Developers are returning obsolete buildings to lenders, foreclosures are increasing, and defaults are occurring in various sectors. The damage is expected to worsen as the storm continues, and property loans are being offloaded at a loss. With tightening credit markets and rising interest rates, only a small percentage of office buildings remain unaffected. The situation is compounded by uncertainty surrounding the future of office spaces.

Rising interest rates and an uncertain economic outlook are leading to a surge in corporate defaults in the US. Companies are struggling with higher debt refinancing costs, resulting in an increase in distress and bankruptcy filings. Multiple industries, including healthcare, retail, and media, are affected, with no specific sector being spared. Analysts anticipate further defaults as companies face challenges in managing their debt burdens.

German conglomerate Siemens became the first company to process euro-denominated payments using JPM Coin, JPMorgan's blockchain-based payment system. JPMorgan expanded the platform from U.S. dollars to euros, allowing corporate clients to transfer euros instantly and 24/7. The system offers cost benefits and increased interest income on deposits. JPM Coin has processed around $300 billion in transactions since its launch in 2019 and is part of JPMorgan's Onyx Coin Systems platform.

Nearly 30% of European and Middle Eastern firms face financial strain due to pandemic-induced debt, rising interest rates, and inflation, warns Alvarez & Marsal. This represents a slight increase from last year and a 12% jump compared to pre-pandemic levels. Weak balance sheets result from heavy debt burdens and reduced profitability. Weaker sectors include non-food consumer businesses, media, entertainment, and energy/utilities. Germany and Spain show signs of potential restructuring activity. Tougher conditions ahead may prompt more companies to pursue deleveraging and restructuring measures.

Global economy faces uncertainty as Russian upheaval threatens energy markets. Armed insurrection near Moscow challenges Putin's authority. Concerns over oil prices and supply disruptions arise. Battle to control prices in decisive phase. Lessons from Libya and Venezuela caution against civil unrest's impact on energy exports. Russia's role as a major player magnifies the risk. Risk of global economic weakening has diminished, but future consequences remain unclear. Vigilance required in navigating evolving situation.