Saturday, June 6, 2020

In Defence of Free Markets

by Alasdair Macleod, GoldMoney:

Why is it that no one defends free markets, and socialism, despite all the evidence of its failures, comes back again and again? Unsurprisingly, the answer lies in politics, which have always led to a boom-bust cycle of collective behaviour. Furthering our understanding of this phenomenon is timely because the old advanced economies, burdened by a combination of existing and future debt, appear to be on the verge of an unhappily coordinated bust. But that does not automatically return us to the free markets some of us long for.

The Four Horsemen of the Apocalypse Hate Silver

by Gary Christianson, Miles Franklin:

Breaking news: The DOW rose 1,985 on Friday the 13th. However, the DOW was down 2,679 for the week ending March 13. Gold fell $155 for the week to $1,516. Silver declined $2.76 for the week to $14.50.

From February 12th to March 12th, the high to low tic loss on the DOW was over 28%. Falling over 25 percent in one month is a rapid reset and an ugly dose of reality for believers in “buy-the-dip” and “Fed-puts.”

The gold to silver ratio hit a historical high this week of 104.6, even higher than in 1991 when silver bottomed at $3.51.

The Four Horsemen of the Apocalypse bring pain and reset expectations. They are, according to some sources, pestilence, war, famine, and death.

Craig Hemke at Sprott Money: Those ‘exchange for physicals’ at the Comex aren’t real

by Chris Powell, Gold Seek:

The TF Metal Report’s Craig Hemke, writing today at Sprott Money, does the math on the last year’s worth of the use of the “exchange for physicals” mechanism of settling gold futures contracts on the New York Commodities Exchange. Hemke calculates that nearly 2.4 million Comex gold contracts have been settled this way since last November, totaling 7,442 tonnes of gold.

This total, Hemke notes, is 260 percent of annual gold mine supply and nearly equal to all the gold claimed to be vaulted by the members of the London Bullion Market Association, the Bank of England, and the Comex itself.

Budget Deficit: Just Under $1 Trillion for 2019

by John Carney, Breitbart:

The U.S. government spent $984 billion more than it collected in taxes and fees in fiscal year 2019, the Treasury Department said Friday.

That represents a 26 percent increase over last year’s $779 billion budget deficit.

When spending exceeds tax collections, as it has every year since 2002, the U.S. government borrows the difference. Interest rates on Treasurys have plummeted this year, suggesting that investors in the U.S. and abroad are eager to buy U.S. debt. A year ago, the yield on the 10-year Treasury was around 3.2 percent. It has since fallen to around 1.8 percent.

The market’s last hope is faltering…

by Simon Black, Sovereign Man:

By July of last year, just three stocks (Amazon, Netflix and Microsoft) were responsible for 71% of the S&P 500’s returns.

Through the third quarter, tech stocks were responsible for 95% of the S&P’s gains.

Amazon alone was responsible for about one-third of the index’s move.

And we long warned about the follies of blindly investing your capital into these incredibly popular and often overvalued firms (we also advised you to start raising cash).

A Recession Indicator Having A PERFECT Record For 70 Years Is About To Be Triggered

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by Mac Slavo, SHTF Plan:

The unemployment rate has been a perfect forecaster of a recession in the past 70 years, and it appears to be edging closer to triggering that signal.  “It’s never been wrong. It’s something to watch,” said Joseph Lavorgna, chief economist for the Americas at Natixis.

As the unemployment rate hovers around 4% (the number reported in the mainstream media) a more accurate unemployment number is 8.1%.  This takes into account those who have given up on finding work and those who are underemployed (workers who are part-time but want full-time employment),  This more accurate unemployment number is called the U-6, while we often hear the U-3 reported on the news. But even former Federal Reserve chair Janet Yellen says the U-6 is a much more accurate indicator of where things are with regards to the economy.

Telltale Signs of Recession

by Charles Hugh Smith, Of Two Minds:

I’m seeing lifestyles that are out of stock and no longer available, even in China.

Though every recession is unique, all recessions manifest in similar ways in the real economy. By real economy, I mean the on-the-ground economy we observe with our own eyes, as opposed to the abstract statistical model reflected in official declarations of when recessions begin and end.

One characteristic that never makes it into the abstract statistical representation of recession is the light switch phenomenon: business suddenly dries up, as if someone turned a light switch off. This is especially visible in discretionary purchases, which include everything from smart phones to vehicles to eating out.

Bank Gold Price Manipulation Continues – Craig Hemke (01/10/2019)

by Craig Hemke, Sprott Money:

You didn’t actually think that a couple of indictments were going to change things, did you? By now you must understand that The Banks will continue to manage and rig prices until the time comes that it is no longer profitable for them to do so.

In case you need a summary of recent events, please take time to review these three links:

• https://www.cnbc.com/2019/08/20/another-ex-jp-morg…

• https://www.nbcnews.com/news/us-news/justice-depar…

• https://www.zerohedge.com/markets/abject-corruptio…

What was once dismissed as “conspiracy theory” is instead becoming widely understood as “historical fact.” Yes, the market-making Bullion Banks seek to manage price for their benefit, and yes, gold price management dates back to the 1950s. However—and despite the recent indictments—these illegal schemes continue to this day.