Author Archives: Daily Market Report

Gold level after hitting lowest level since early May on Friday

(USAGOLD – 5/20/2019) – Gold is level this morning still trying to make up its mind about the latest volleys fired between the two sides in the US-China trade dispute. It is trading early in the US session at $1276.50 – its lowest level since early May.  Silver has added modestly to its price – up 5¢ at $14.43. The yellow metal ended last week in a slump that most analysts traced to a sharp drop in China’s yuan.  Questions abound about China’s willingness to defend its currency.  Like gold, it is trading sideways this morning. The stand-out market this morning is stocks – down 172 as this posted.

Over the weekend Bloomberg asked Granite Shares’ Will Rhynd a question on the mind of a good many investors. Why has gold failed to rally in the face of the present uncertainty? “The trade talks,” he responded, “and the kind of breakdown in trade talks at the moment is negative in the sense that it is manifesting itself in a more stronger dollar. The late cycle trade right now is still positive for gold and we see investors as positioning themselves that way – being more defensive and being more defensive typically means an allocation to gold.”  He went on to say that a physical gold ETF fund his firm offers has increased by well over one-third this year as a result of investors “being more defensive, adding gold to the portfolio – people looking for uncorrelated asset classes.  Since the beginning of the year, we have seen a big uptick in gold interest.”

Quote of the Day
“I’m not opposed to a new Bretton Woods conference, and if it takes place at Mar-a-Lago, I’m fine with that. But anything the U.S. does because we print the international reserve currency, unilateral action would almost instantly be accommodated by other countries. In terms of gold being involved, some people may think of that as a throwback, but I see it as a sophisticated, forward-looking approach because gold is neutral and it’s universal. It’s a well-accepted monetary surrogate that transcends borders and time. If you look at the foreign reserves of the most important countries, they keep them mostly in gold. I don’t want to read too much into it, but it proves that gold is not some barbarous relic.” – Dr. Judy Shelton, economic advisor to President Donald Trump (said to be on the inside track for appointment to the Federal Reserve’s Board of Governors)

Chart of the Day

Chart courtesy of TradingEconomics.com

Chart note:  The Trump administration introduced tariffs on selected Chinese imports in March 2018 and the China yuan immediately turned south.  After stabilizing somewhat beginning in late 2018, it again dropped sharply beginning in April 2019 as talk began to break down.  Since the March 2018 interim peak, the yuan has dropped about 10%.  Since April 2019, it has fallen about 3.5%.  There is a direct correlation between the imposition of tariffs and depreciation of the yuan.  The outstanding question at this point in time is if Chinese authorities will step back and watch or take measures to halt the decline.

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold off marginally in subdued reaction to another sharp drop in the yuan

(USAGOLD – 5/17/2019) – Gold is off marginally this morning as tensions escalated between the US and China. Yesterday, gold plummeted sharply along with China’s currency.  Today the drop has been more subdued even as the yuan continued its free fall in the offshore market – a situation that signals some investors might be looking to safe havens as a worthy alternative at this juncture. Bonds – the other primary safe haven destination – are also higher this morning. The yellow metal is down $1.50 in the early going at $1284.  Silver is down 7¢ at $14.48.

In a Kitco interview yesterday, Scotiabank’s Nicky Shiels said that gold has stuck in a four year lull but that 2019 might the year it breaks out of its narrow range.  “We feel we are in a good spot for the next commodity cycle,” he said. “Gold is perking up this year, trying to break out of its four-year cycle. It is viewed generally as a hedge to the dollar alongside to being a hedge to inflationary policies and geopolitical risks. I believe gold has a chance of reaching $1,400 this year.”

Quote of the Day
“[S]ome of the biggest players in the gold sector are warning we’ve seen peak gold production. Also, the biggest pools of money on the planet – central banks – are loading up on gold. Dwindling supply met with tons of demand means higher prices.  Historically, gold has been a fantastic leading indicator of central bank policy… The metal ran from under $1,200 an ounce to nearly $1,300 an ounce prior to the Fed’s reversal in January. And if it runs higher from here, which we fully expect, it means all hell is about to break loose. I’d recommend adding to your position while you still can.” – Simon Black, Sovereign Man

Chart of the Day

Chart note: Up until the “double oughts,” the manual on gold read that it performed well under inflationary and deflationary circumstances, but not much else. However, as the decade of asset bubbles, financial institution failures, and global systemic and sovereign debt risk progressed, gold marched to higher ground one year after another. As events unfolded, it became increasingly clear that the metal was capable of delivering the goods under disinflationary circumstances as well. The fact of the matter is that, during the 2000s even as the inflation rate hovered in the low single digits (See chart, green area], gold managed to rise from just under $300 per ounce in the early 2000s to just over $1800 per ounce by 2011 — a gain of nearly 650%. Since then, gold has taken a breather. As this essay is written, it is trading in the $1285 per ounce range — still up over 425% in the new century.

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

DMR UPDATE

(USAGOLD – 5-16-2019) – We can’t be certain at this juncture, but it looks like this morning’s sell-off in gold is related to weakness in China’s yuan. An article in the South China Morning Post today focuses on the 2% drop in China’s currency over the past two days* and states that a “further slide of the yuan below 7.00 to the dollar could counter a new 25 per cent tariff on US$300 billion of Chinese goods exported to the US.” It then quotes Capital Economics’ senior China economist Julian Evans-Pritchard as saying that “if tariffs were ultimately implemented on all US imports from China, Beijing would have less to gain from supporting the yuan than allowing the market to weaken it.”

Along these lines, Deutsche Bank is out with a report this morning (featured at ZeroHedge) saying that “Asia is the region we expect to suffer most from the renewed global headwinds. We argue that policymakers in China are now going to be more accepting of USD/CNY appreciation through 7 . . .”  That kind of thinking, we believe, is what probably drove the dollar sharply higher this morning and gold sharply lower. If something else surfaces, we will post it.

* The 2% drop SCMP cites appears closer to 2.5%, but occurring since May 6 – not the past two days.

Chart courtesy of TradingEconomics.com

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Posted in Today's top gold news and opinion |

Gold continues retreat from $1300 level

(USAGOLD – 5/16/2019) – Gold continued its retreat from the $1300 level begun yesterday.  It is trading at $1291.50 early in the US session – down $5 on the day.  Silver is down 3¢ at $14.77. “We have seen repeated attempts in the last few days to rise above $1,300 and it (gold) appears to be facing some kind of barrier. There is clearly some selling when it hits that level,” Capital Economics analyst Ross Strachan told Reuters yesterday.

Lingering hopes that the US and China might still agree to a trade deal and the Trump administration’s decision to put a six-month delay on EU auto tariffs (and avoid a two-front trade war) contributed to the pull back. In other news, Scrap Register reports that “India’s gold imports spiked by 54% to $3.97 billion in April from $2.58 billion in the same month last year, according to the latest data release from the Ministry of Commerce.” Strong seasonal demand was given an assist by rupee weakness and a correction from a five-year high in the rupee gold price.

Chart courtesy of Bullion-Rates.com

Quote of the Day
“Were Keynes alive today, he would likely be arguing along with German Chancellor Angela Merkel for more monetary discipline and a return to a more balanced international system. No doubt, however, his neo-Keynesian acolytes would be dismissing his concerns as hopelessly outdated and reactionary. Keynes was an economic theorist, but he was also a clear-eyed market analyst, and a passionate and committed speculator for his own account and for Cambridge University. If he took in today’s economic vista of near-zero interest rates and quantitative easing, it is clear that he would be buying gold hand over fist—regardless of what his disciples might think.” – Richard Hurowitz, Octavian Report (in a Wall Street Journal editorial published September 2015)

Chart of the Day

Chart courtesy of GoldChartsRUs/Nick Laird

Chart note: This interesting chart on consumer prices from 1550 to present shows the direct relationship between declining purchasing power in the British pound and the sterling price of gold after 1931, the year Britain departed the gold standard. Prior to 1931, there was an occasional minor bump higher in the price of gold, as you can see, but for the most part it followed along the same flat line as consumer prices. It was only after Britain separated the pound from gold in 1931 that gold showed its true colors as portfolio defense against a depreciating domestic currency. The metal’s price moved significantly higher after 1971 when the Bretton Woods agreement was abandoned and currencies and gold were allowed to move freely in international markets. The real lesson in this chart is that when a nation-state moves away from gold-backed to fiat money, gold coins and bullion become a logical and worthwhile alternative for citizen-investors – even after centuries of relative price stability.

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Gold up as Monday’s market dynamic reasserts itself

(USAGOLD – 5/15/2019) – Gold reasserted itself in today’s early going after taking a minor hit yesterday in the ‘day-after’ reaction to Monday’s financial market drama.  It is up $3 at $1300 early in today’s session. Silver continues to lag – up 1¢ at $14.81.  As mentioned in yesterday’s DMR, on Monday we saw the initial reaction to a major change in market atmospherics.  Over the coming days and weeks, “we could see a more sustained reaction as steadier and more determined hands take the rudder. Under the circumstances, safe havens like bonds and gold are likely to receive a fair amount of attention.” Today, we are beginning to see some signs of Monday’s market dynamic reasserting itself. Gold and bonds are both back to the upside and stocks are down sharply.

Sharps Pixley’s Lawrie Williams had a similar take yesterday. “Equities may bounce back,” he wrote, “but such a bounce could be shortlived and if so gold is likely to breach $1,300 yet again and perhaps this time the breach could be permanent.  Resistance is seen at $1,310 but many analysts see $1,350 as the key and if the gold price can get through that level in the northern hemisphere summer it could be poised for $1,400 and above in the second half of the year.”

Quote of the Day
“There are those who are persuaded that some new price-enhancing circumstance is in control, and they expect the market to stay up and go up, perhaps indefinitely. Then there are those, superficially more astute and generally fewer in number, who perceive or believe themselves to perceive the speculative mood of the moment. They are in to ride the upward wave; their particular genius, they are convinced, will allow them to get out before the speculation runs its course. They will get the maximum reward from the increase as it continues; they will be out before the eventual fall. For built into this situation is the eventual and inevitable fall.  Built in also is the circumstance that it cannot come gently or gradually. When it comes, it bears the grim face of disaster. That is because both of the groups of participants in the speculative situation are programmed for sudden efforts at escape.” – John Kenneth Galbraith, A Short History of Financial Euphoria, 1990 (With thanks to John Hussman, Hussman Funds)

Chart of the Day

Charts courtesy of TradingView and BullionRates.com

Chart[s] note: “The countries with the highest country risk,” says analyst Daniel LaCalle of Thinking Heads Agency, “are also those that have abused most of the financing of public spending by the central bank through the printing of currency. Argentina has a higher country risk than apparently more fragile economies due to the constant refusal on the part of the successive governments to adopt a prudent monetary policy and to defend the purchasing power of the currency.” As economies around the globe weaken, the temptations presented by the monetary printing press will become increasingly difficult to resist. In each instance, domestic gold demand is likely to rise as a consequence.  It is usually only a matter of time until the price in that currency follows suit.  The two short-term charts shown above illustrate the process.

 

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold posts half-hearted, marginal loss in early going

(USAGOLD – 5/14/2019) – Gold is taking a half-hearted loss this morning and stocks are posting a half-hearted gain – not unusual after a day of heady market movement. Gold is down $2.50 at $1299 in the early going after finishing up $14 yesterday. The Dow Jones Industrial Average is up about 80 this morning after losing over 600 yesteray. Silver, on the sidelines for the most part in all of this, is up 3¢.

Though US-China trade negotiations remain front and center, rising tensions with Iran have also begun to weigh on markets. Crude oil is up 85¢ today. Britain’s foreign minister, Jeremy Hunt,  pointedly warned Monday “of a conflict happening by accident with an escalation that is unintended.” Yesterday, we had the initial reaction to a major change in market atmospherics. Over the next several days, we could see a more sustained reaction as steadier and more determined hands take the rudder. Under the circumstances, safe havens like bonds and gold are likely to receive a fair amount of attention.

Quote of the Day
“It’s all about relative supply curves – the supply curve for bullion is far more inelastic than is the case for paper money. It really is that simple.“ – David Rosenberg, Gluskin Sheff

Chart of the Day

Visualization courtesy of HowMuch.net

Chart note from HowMuch.net:  “About half of the countries in the top ten list are located in the Middle East/North Africa region.  Six of these countries–Venezuela, Saudi Arabia, Iran, Iraq, Kuwait, and Libya–are members of OPEC (Organization of Petroleum Exporting Countries). Interestingly, there is no clear correlation between the country’s size and its amount of oil reserves. For example, Kuwait, which has a landmass of 17,818 sq km, has 101.5 Gbbl in oil reserves, whereas Russia, which has a landmass almost ten times larger, only has 80 Gbbl in oil reserves.”

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Gold up sharply on safe-haven trade, inflation expectations as US-China talks hit wall

(USAGOLD – 5/13/2019) – Gold rose sharply at the New York open on clear signs emerging over the weekend that trade negotiations between the United States and China had hit a wall.  The precious metal is up $10 on the day at $1296 after trading as low as $1282.50 during Asian trading hours.  Silver is level at $14.75.  Goldman Sachs was among the first to post a reaction to the breakdown saying that the cost of tariffs has “fallen ‘entirely’ on American businesses and households, with a greater impact on consumer prices than previously expected,” according to a CNBC report.

AMP Capital Investors Nader Naeimi summed up developing sentiment in some quarters by saying that the stock market had priced in a best case scenario that was rapidly shifting to a worst case scenario.  “China demanding the U.S. drop the tariffs is setting the stage for a serious face-off,” he said. “Economic tensions can now morph into military tensions between the two countries, and then with the U.S.-Iran flexing their muscles, oil prices are at risk of spiking up. For complacent equities, a perfect storm is brewing: tariffs, higher prices, a possible spike in oil prices in the face of fragile global growth. My asset allocation is gold, oil, inflation-linked bonds and defensive positioning” [Emphasis added]

That allocation looks pretty promising this morning.  Stocks are down 500. Oil is up $1.65. Bond prices are rising and gold, as we mentioned at the top, is up $10. The dollar index, by the way, is down sharply this morning despite a notable drop in China’s yuan.

Quote of the Day
“Gold is scarce. It’s independent. It’s not anybody’s obligation. It’s not anybody’s liability. It’s not drawn on anybody. It doesn’t require anybody’s imprimatur to say whether it’s good, bad, or indifferent, or to refuse to pay. It is what it is, and it’s in your hand.” – Simon Mikhailovich, Tocqueville Funds

Chart of the Day

Chart note:  This chart shows the percent change year over year in the volatility index along with the price of gold.  As you can see, past bouts of increased volatility have preceded upward movement in the price of gold.  The last spike in volatility came at the end of last year and it matched in magnitude spikes that occurred during the 2007-2008 credit crisis.

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Investors sweat as game of chicken over Sino-US trade heats up

Financial Times/Michael Mackenzie/5-11-2019

“A growing risk is that Mr Trump won’t just stop with this latest escalation. There’s the threat of extending US tariffs to all Chinese imports and Washington trade hawks are circling Japan and eyeing Germany and the wider eurozone.”

USAGOLD note:  Press reports tell us that it will be a month before the effect of tariffs shows up in consumer prices and that is the time China and the United States have to patch things up. Then, as Mackenzie suggests, there is burgeoning trade wars with Japan, Germany and the rest of the EU. Perhaps the cacaphony on inflation will rise once again as the implications begin to seep in.  I will remind our readers that part of the genius of Alan Greenspan was to foresee Chinese imports would hold inflation down and allow him the luxury of lower interest rates.  What happens when the opposite takes place, i.e. tarriffs + import fees = the shelf price? Will it unleash the forces of inflation buried deeply in the present economic balance?

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Gold off to strong start on new tariff regime, presidential tweets, mixed signals in FOREX markets

(USAGOLD – 5/10/2019) – Gold is off to a strong start this morning as higher tariffs on China kick in and the President tweets that “tariffs will bring in far more wealth in our Country than even a phenomenal deal of the traditional kind.” It is now up $5 in early U.S. trading at $1289 after rising marginally in Asia overnight.  Silver is up 4¢ at $14.82. The president’s tweets this morning appear to be an attempt to acclimate Americans to the prospect of a longer-term trade war and soothe jittery financial markets.

“The dollar isn’t acting as a safe haven in stressed markets as it usually does,” writes David P. Goldman in Asia Times. “On the contrary, it is absorbing a good deal of the stress. That’s still a small black cloud rather than a thunderstorm, but it suggests that markets are pricing trade-war risk into the US dollar as well as the Chinese yuan. The implication is that the consequences of a full-blown trade war could be nasty for world capital markets.”  He goes on to point out that in recent days the dollar dropped against the euro and yen while rising against the yuan.  Amidst the confusion, gold has held its own with some evidence of being the recipient of current safe-haven capital flows, particularly during Asian trading hours. (Please see today’s Chart of the Day below.)

We invite you to check back for a possible afternoon update today.  We are monitoring what could turn out to be an interesting day in financial markets.

Quote of the Day
“In retrospect, the spark might seem as ominous as a financial crash, as ordinary as a national election, or as trivial as a Tea Party. The catalyst will unfold according to a basic Crisis dynamic that underlies all of these scenarios: An initial spark will trigger a chain reaction of unyielding responses and further emergencies. The core elements of these scenarios (debt, civic decay, global disorder) will matter more than the details, which the catalyst will juxtapose and connect in some unknowable way. If foreign societies are also entering a Fourth Turning, this could accelerate the chain reaction. At home and abroad, these events will reflect the tearing of the civic fabric at points of extreme vulnerability – problem areas where America will have neglected, denied, or delayed needed action.” – William Strauss and Neil Howe, The Fourth Turning

Chart of the Day

Chart courtesy of TradingEconomics.com

Chart note:  Gold has held steady since the initial tariff shock at the beginning of the week.  Meanwhile, China’s yuan has dropped abruptly. Speculators will likely test the waters with the yuan, i.e., see how willing China is to defend its currency under new and developing circumstances. Gold and the yuan have generally traveled in the same direction in recent years.  The chart illustrates the first signs of a potential break with that past.  It also serves as an initial warning that perhaps the old tried, true and generally accepted formulae might not work in this rapidly changing commercial and foreign exchange environment – one that increasingly looks like it might include an all-out trade war between the world’s two largest economies. 

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold level today in quiet trading

(USAGOLD – 5/9/2019) – Gold is level in quiet early trading as the U.S. and China turn the page today on trade negotiations.  Silver is down 11¢ at $14.75. With a prevailing calm having descended upon financial markets this morning, we will cut this report short with a promise to update later if anything of significance develops.

Quote of the Day
“Financial markets have short memories. Of late, they’ve convinced themselves that collateralized loan obligations (CLOs) are much safer instruments than the collateralized debt obligations, or CDOs, on which they’re based and which helped precipitate the 2008 crisis. They’re wrong — and dangerously so.” – Sanjiyat Das, Bloomberg Opinion

Chart of the Day


(Interactive chart)

Chart note: This interactive chart compares price appreciation for gold and the dollar index. Gold has consistently outperformed the dollar in twelve of the last eighteen years – a formidable record. Even if one were to add in average yields on dollar-based investments, gold still comes out the clear winner in those twelve years. Gold had an off-year in 2018 – down 1% while the dollar was up almost 7%. Given the performance record, though, contrarian investors might see the present disparity as a buying opportunity.

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold pushes up on Reuters report of deeper trade rift than originally thought

(USAGOLD – 5/8/2019) – Gold pushed higher in early trading on a Reuters reports released overnight that China had back-tracked on nearly all aspects of the trade negotiations with the United States. Gold is up $4.50 in early U.S. trading at $1289.50.  Silver is up 2¢ at $14.94. The report will likely serve as justification for the president’s ratcheting up of tariffs over this past weekend. At the same time, though, it will put a damper on market expectations that the rift might be short-lived.

“Gold,” says Julius Baer’s Mark Matthews in an ET Markets report, “should be about 15% higher over the next year and the basic reason is that eventually the US dollar is going to stop going up. At the same time with all these trade wars and confrontations between major powers of the world, Russia, China, the United States, there is a case for diversification away from dollars and the central banks are doing that. One of the things they are diversifying into is gold. I would say we like gold in the commodity space.” XinhuaNet, China’s official press outlet, reports overnight the Peoples Bank of China added nearly 15 tonnes to its gold reserves in April – the fifth consecutive month of additions to its holdings.
Quote of the Day
“Like liberty, gold never stays where it is undervalued.” – John S. Morrill

Chart of the Day

Chart note: “The figure,” say the authors of this study published by the St. Louis Federal Reserve, “shows that the uncertainty shocks that hit the economy in the fourth quarter of 2018 and in the first quarter of 2019 (January) have been the largest during our sample period. Based on the framework we use, this finding has potentially ominous implications for the U.S. economy.”  A fitting chart as we weigh the effects of a possible breakdown in trade talks between the United States and China. . . . . . .

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Gold off marginally in early going; study says 20% of wealthy worldwide will increase gold holdings in 2019

(USAGOLD – 5/7/2019) – Gold is off marginally in the early going today as East and West alike await the next turn of the wheel in the trade talk saga.  The yellow metal is off $1 at $1282.  Silver is down 5¢ at $14.88.  While the paper gold market continues to be most influenced by immediate concerns, physical buyers continue to hedge the more protracted scenario – mostly centered around gold’s longer-term role as a hedge against currency debasement within national economies.

In India, where the rupiah has declined almost 45% against the dollar since 2009, investors continue their long history of accumulating gold for asset preservation purposes. “Today,” reports India’s Financial Express, “is Akshay Tritiya, also known as Akha Teej, a Hindu festival which is considered auspicious for buying the yellow metal. The experts are bullish on buying gold today as the investment will fetch good returns from long-term investment point of view.” The Financial Express goes on to say that it has been a good year for the monsoon and that farmers, a traditionally strong market for gold, will begin accumulating the metal from today. Along these lines, it is of particular interest that 20% of the wealthy worldwide intend to increase their gold holdings in 2019, according to a recent report from KnightFrank, the British property consultancy.

Quote of the Day
“Financialization is the smiley-face perversion of Smith’s invisible hand and Schumpeter’s creative destruction. It is a profoundly repressive political equilibrium that masks itself in the common knowledge of  ‘yay, capitalism!’. Financialization is a global phenomenon. In China, it’s transmitted through the real estate market. In the US, it’s transmitted through the stock market. Financialization is the zombiefication of an economy and the oligarchification of a society.” – Ben Hunt, Epsilon Theory

Chart of the Day

Chart note: When the United States abandoned the gold standard in 1971 and freed currencies to float against one another, the fiat money era began. We are still in that era today. This chart shows the performance of gold from the early 1900s to 1971 when gold backed the dollar, and the era from 1971 to present when it did not. Gold has had its ups and down since 1971, but clearly, over the long run, in the absence of an official gold standard, individual investors have been well-served by putting themselves on a private gold standard.

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Trump, Shumer and Pelosi agree on ‘big, bold’ infrastructure plan

SafeHaven/Richard Mills/5-4-2019

“‘We agreed on a number, which was very, very good – $2 trillion for infrastructure. Originally we had started with a lower – even the president was eager to push it up to $2 trillion,’ Schumer said.”

USAGOLD note:  The article goes on to state that the program faced “hurdles” in Congress because the players did not address how the program would be funded. We should keep in mind that this $2 trillion expense will be above and beyond what the federal government is already spending.

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Silver sets up a long-term wave B bottom

TechnicalTradersLtd/Chris Vermuelen/5-5-2019

“Our Fibonacci price modeling system is suggesting an upside price target of $22 per ounce for this move, which breaks the previous July 2016 highs of $21.22. We believe the ultimate upside target of this next bullish move is bear $28 to $29 based on longer-term Fibonacci price modeling.”

USAGOLD note:  As we like to mention regularly, when we post an opinion like this it is not necessarily because we endorse it.  Rather, we think it worth passing along so that the reader can make his or her own judgement as to its usefulness. We continue to advise ownership of gold and silver for long-term asset preservation purposes rather than as vehicles for speculation.

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Posted in Gold and Silver Price Predictions from Prominent Players for 2019, Today's top gold news and opinion |

Gold level in U.S. after charge higher in Asian trading turned back

(USAGOLD – 5-6-2019) – Gold at first reacted positively to China trade negotiations breakdown rising in Asian markets as stocks slid.  In European trading though it began to turn south as China’s yuan hit the skids and it looked like the dollar would emerge as the early beneficiary in this turn of events. It is now trading at $1279 and level on the day.  Silver is down 12¢ at $14.78. We caution that it is early in the day and that it will take some time for the full effects and reactions get sorted out.  The Dow Jones Industrial Average is down sharply as this report is posted.

Though the safe-haven trade seems to have migrated to the dollar as an initial reaction, investors in China – including its government, commercial banks and central bank – could become even more aggressive than they are already in buying physical gold bullion as an alternative to the dollar.  At the very least, China is likely to continue its policy of shunning U.S. Treasuries’ purchases at a time when the U.S. is issuing debt in unprecedented volumes. In the end, a major breakdown in the trade negotiations between the United States and China could lead to unforeseen consequences for both countries that will play out in the full course of time. . . . . .  It is appropriate that we would feature the movement of gold West to East in today’s Chart of the Day.

Quote of the Day
“Most serious accidents have multiple causes. A series of mistakes or pieces of bad luck line up to allow disaster. The Torrey Canyon was hampered by an unforgiving schedule, barely adequate charts, unhelpful winds and currents, confusion over the autopilot, and the unexpected appearance of fishing boats in the intended course. But reading Richard Petrow’s contemporary account of the Torrey Canyon disaster, a clear lesson is that Capt Rugiati was too slow to adjust. He had a plan, and saw far too late that the plan was doomed to failure — and with it, his ship.” – Tim Hartford, Financial Times columnist

Chart of the Day

Chart courtesy of GoldChartsRUs/Nick Laird

Chart note: This chart shows the oft-referenced flow of gold west-to-east combined with the growth of internal reserves the result of channeling mine production into central bank holdings. The principal players – China, Russia, Turkey and India – are the beating heart of the global market for physical gold bullion. There is no evidence that there will be a major reversal in this structural pattern in global supply and demand anytime soon. Please take note that the four countries combined monthly demand is now running consistently above global production, as shown on the bottom segment of the chart.

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Trump tweets duties on China imports will increase on Friday

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Posted in Today's top gold news and opinion |

Afternoon Update

(USAGOLD 5-3-2019 PM) – Gold recovered all of what it lost over the past week in a flurry of buying at this morning’s COMEX open. (Please see accompanying chart.) It finished the day up $8.50 at $1279.50, where it began the week.  Silver closed at $14.94 – up 33¢ on the day and up 7¢ on the week. The buying was most likely related to ordinary short covering of positions put on earlier in the week combined with simple recognition that the downside of the past several days was an overdone reaction to the aftermath of the Fed meeting. The Fed’s policy actions, after all is said and done, were a deliberate affirmation of its dovish tilt – and carefully represented as such in the follow-up public statement. Reducing the rate paid on excess reserves was a clear indication that the Fed would like to keep a lid on interest rates. The market may have simply decided that actions, in the end, speak louder than words and adjusted accordingly.  As always, if anything more definitive surfaces, we will post it here, so please stay tuned. . . . .

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Shocks loom over this bull market, warns Swiss hedge-fund manager

MarketWatch/Shawn Langlois

“In the fall of 2018, Felix Zulauf, head of Swiss hedge fund Zulauf Asset Managment, said investors were facing the start of a ‘structural bear market.’ In other words, not much upside and a downside that’s limited by central banks. When the market sells off 20%, 25% or so, they will come in to support it, and the market rallies again,’ he said at the time. ‘Then it fades again and it goes deeper than the last time. This is a very serious, very difficult market to have.'”

USAGOLD note:  Zulauf’s analysis covered at the link above will resonate with a good many gold investors . . . As this article mentions, Zulauf has made some epic stock market calls in the past including the crash of 1987 and the rebound in 2009.


Repost from 4-29-2019

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Posted in Today's top gold news and opinion |

No DMR today. . .

. . .but please check back.  We may post an update later if anything of interest happens.

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold down on Fed chairman’s ill-timed use of the word ‘transitory’

(USAGOLD – 5-2-2019) – Gold continued to drift lower in overseas trading last night in response to the latest Fed meeting-statement-news conference onslaught. That weakness carried over to this morning’s COMEX open.  It is now trading at $1269 – down $8 on the day and $12 from just before the Fed chairman’s stepping to the podium.  Silver is down 11¢ on the day at $14.63.

Gold’s sudden drop during Jerome Powell’s press conference at first seemed devoid of explanation.  Nothing he said went beyond the most benign and inoffensive – or so it seemed.  Apparently though, according to reports this morning, gold (along with other markets) was responding to a casual reference by Mr. Powell to the “transitory” nature of low inflation – a comment that the markets read as hawkish.  The reaction was immediate.  Stocks, gold and bonds plummeted sharply.  All of which prompted Gluskin Sheff’s David Rosenberg to comment: “If Powell is so sure the decline in core inflation is transitory, why wasn’t this mentioned in the press statement?” A reasonable question posed to those who think that they might have found a backchannel to the chairman’s innermost thoughts.

“Given that there was effectively no change in the Fed’s overall position,” says Sharps Pixley’s Lawrie Williams, “and virtually all the factors Powell had noted on the assumed strength of the U.S. economy had been well triggered in advance we feel that the sharp move downwards in the gold price was largely unjustified and prices should thus recover much, if not all, the lost ground.”

Hopefully, before the week is out, my fellow goldmeisters, reason shall prevail. . .Stocks and bonds also continued their drift lower in today’s early going with oil joining the party for good measure.  Meanwhile, the chairman of the Federal Reserve is probably on his way to the office this morning wondering what just happened. . . . .

Quote of the Day
“While there will always be some standouts, it’s not clear why so many managers can claim sustained superior performance. The basic technology, data and expertise is readily available. Logically, the anomalies that the strategies rely on should dissipate. There is an inherent contradiction in that the approach exploits inefficiencies, but requires market efficiency to realign prices to generate returns. The reality is that any fund managers possessing a magic investment formula guaranteeing low risk and high returns would have no incentive to share the secret. Successful firms such as Renaissance Technologies LLC have closed some funds to outside investors, preferring to capture the returns for themselves. As legendary investor Paul Tudor Jones once noted, if there was a single easy formula to follow, then all investors would already be rich.” – Satyajit Das, Bloomberg opinion columnist

Chart of the Day

Chart note: We faithfully and painstakingly reproduced this chart developed by UK’s Colin Seymour in 2001. Posted originally at the USAGOLD website, Seymour’s chart and the annotations that went with it caused quite a stir on the internet at the turn of the century and the early stages of gold’s secular bull market. It is still widely referenced and linked on the world wide web. We recently re-reposted the study as part of a site-wide upgrade to current internet presentation standards we hope to fully unveil soon. It is as relevant to investors today as it was in 2001. Here is the link to the original article titled Pompous Prognosticators.

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Germany needs a plan B after Deutsche Bank deal collapses

Bloomberg/Bergit Jennen and Patrick Donahue

“Deutsche Bank is a particular concern in political circles, said the people, asking not to be identified discussing internal deliberations. The country’s largest lender is considered systemically relevant by regulators and has continued to struggle after a series of missteps during the financial crisis a decade ago.”

USAGOLD note:  Of all the proverbial canaries in the coal mine, Deutsche Banks is the one that gets our undivided attention as potentially the 2019 version of Lehman Brothers.  In this instance, it is not a bank that the authorities refuse to help, but one that perhaps no other bank will touch in terms of a merger.  One wonders what might be on the books that makes it so unappealing. . . . Ingrid Arndt-Brauer, a SPD lawmaker on the Bundestag’s finance committee, is quoted in the article as saying: “But with the end of the merger talks, the problems in the banking sector haven’t been solved. They continue to exist and need to be addressed.”


Repost from 4-25-2019

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Posted in Today's top gold news and opinion |

Gold edges lower as Fed concludes meeting

(USAGOLD – 5-1-2019) – Gold edged lower in advance of today’s wind-up to the Federal Reserve Open Market Committee meeting.  It is trading at $1281 and down $3 early in the COMEX session.  Silver is down 12¢ at $14.83. Despite the president’s call for a 1% cut in interest rates and a restart to quantitative easing, few expect much more than a rhetorical adjustment or two to its current already dovish policy stance.

In an interview at the Financial Sense website, well-known Lichtenstein-based analyst Ronald Stoeferle says that “we are unlikely to see strongly rising or clearly positive real interest rates in the coming years. Central banks are caught in the interest-rate trap.”  So much so that “the market is addicted to this punchbowl of cheap liquidity and central bank stimulation,” he says. “We clearly saw in the fourth quarter last year that markets really didn’t appreciate that. What we said turned out to be true because we have seen this monetary U-turn. … I have no doubt that this is also going to be positive for gold.” Stoeferle believes that the president will get his wish.  The Fed, he predicts, will again become a net buyer of U.S. Treasuries.

Quote of the Day
“The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.” – Ernest Hemingway

Chart of the Day

Chart note: “Venezuela’s annual inflation rate,” says TradingEconomics.com rather matter of factly, “fell to 1.62 million percent in March of 2019 from 2.3 million percent in February, according to estimates from Venezuela’s opposition-led Congress. It is the lowest annual inflation rate since November. Inflation Rate in Venezuela averaged 21,261.89 percent from 1973 until 2019, reaching an all-time high of 2,688,670 percent in January of 2019 and a record low of 3.22 percent in February of 1973.” We are happy to see that things are improving in Venezuela.

 

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Gold treading water ahead of Fed, Rosenberg says ‘cyclically-adjusted GDP contracting’

(USAGOLD – 4-30-2019) – Gold is priced at $1282 and level with yesterday’s close ahead of today’s Fed meeting.  Silver is down 4¢ at $14.90.  With oil moving sharply to the upside this morning and the dollar down, the quiet gold market is a bit of an anomaly. Fed Week, though, is typically a drag on the gold price and that might be the dominant mindset in today’s early going.  The yellow metal traded firmly in Asia overnight – up $6 at one point – but gave back those gains at the COMEX open.

The gold market (along with financial markets in general) has yet to completely digest completely the unusual GDP/PCE report issued last Thursday, i.e., the one to which it reacted by rising $9 out of the gate. We came across this assessment from Gluskin Sheff’s widely-followed David Rosenberg and thought it worth passing along: “This was a low-quality GDP report. All one-offs – lower imports, higher inventories & Pentagon spending. Real final private sales a puny 1.3%. Removing more lipstick from this pig shows cyclically-adjusted GDP contracting at a 2% annual rate; deepest decline in nearly a decade.”

There will be those sitting around the table at today’s meeting of the Federal Open Market Committee for whom that 2% cyclically-adjusted contraction will have a sobering effect. If a more dovish public posture on the part of the Fed is the result, it could have a positive effect on the gold market.

Quote of the Day
“There are those who are persuaded that some new price-enhancing circumstance is in control, and they expect the market to stay up and go up, perhaps indefinitely. Then there are those, superficially more astute and generally fewer in number, who perceive or believe themselves to perceive the speculative mood of the moment. They are in to ride the upward wave; their particular genius, they are convinced, will allow them to get out before the speculation runs its course. They will get the maximum reward from the increase as it continues; they will be out before the eventual fall. For built into this situation is the eventual and inevitable fall.  Built in also is the circumstance that it cannot come gently or gradually. When it comes, it bears the grim face of disaster. That is because both of the groups of participants in the speculative situation are programmed for sudden efforts at escape.” – John Kenneth Galbraith, A Short History of Financial Euphoria, 1990 (With thanks to John Hussman, Hussman Funds)

Chart of the Day

Chart note:  The OECD measures consumer confidence in various economies including the United States. A reading above 100 indicates a positive outlook toward the future economic situation.  Values below 100 reflect a more pessimistic outlook.  As you can see, we are now at a level in consumer confidence that has signaled downturns in the past.  In fact, consumer confidence is now ahead of where it was just before the 2008-2009 recession and just below the level it registered before the dot.com stock market bust in 2000.

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Gold opens week lower, Asian buyers push bullion premiums higher

(USAGOLD – 4-29-2019) – Gold opened lower on the COMEX this morning after a listless night overseas.  It is trading at $1282.50 – down $3.75 from Friday’s close. Silver is down 9¢ at $14.99. Reuters reported early Friday that gold demand in Asia is picking up at currently low prices. Buying in India is strong for wedding season while bullion premiums in China are at the highest in two years. The event of the week will be the Fed meeting Tuesday and Wednesday.  Though no surprises are expected, Friday’s unexpectedly low PCE inflation reading raised a few eyebrows and sent the gold price up $9 on the day. Financial Times says that “inflation’s persistent weakness is troubling the Fed” and a sign that “the economy may be weaker than thought.”

Quote of the Day
“I hear people saying: ‘Maybe the Federal Reserve can use the reduction of interest rates forever. Maybe the central banks can just use quantitative easing forever, continuously buy securities and pop liquidity into the economy. And, maybe we don’t ever have to have a slowdown again.’ Simply put: ‘It’s different this time.’ But how much money would you want to bet on that? Is it really possible that we will never have a recession again? I’m not sold on this because the riskiest thing in the world is to believe that there is no risk. When people sense that the risk of an economic slowdown has been eliminated, they will take steps to ensure that there is plenty of risk present, in particular by bidding up security prices too high. People create risk through their own behavior.” – Howard Marks, the Market NZZ interview

Chart of the Day


Chart courtesy of Sentimentrader.com

Chart note: “Maximum optimism Dumb Money Confidence,” writes Sentimentrader’s Jason Goepfert, “has been climbing steadily for a month, and stocks have so far shrugged off that extreme optimism. Now it has reached its highest level in a decade. Every date that saw this high of a reading in the past 20 years sported a negative return in the S&P 500 at some point between the next 2-8 weeks. This is also one of the handful of times since 1999 when Dumb Money was highly confident about a market rally two weeks into an earnings reporting month.”

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Gold shuns GDP report, reacts instead to PCE – up $6 in early trading

(USAGOLD – 4-26-2019) – Gold was ambling along lazily this morning until the Bureau of Economic Analysis announced GDP (an unexpectedly strong +3.2%) and PCE (a very weak 1.3%) numbers.  Gold’s immediate response was to go sharply lower, then it turned on a dime and went sharply higher.  Obviously, it registered a stronger response to the downbeat PCE report, the Fed’s preferred inflation gauge, than it did to the upbeat GDP number, the widely-followed measure of general economic performance. All, in the hearts and minds of Wall Street’s best and brightest, rests upon what the Fed might or might not do next. As it stands, gold is up $6 on the day $1285.  Silver is up 8¢ at $15.05.

ThomsonReuters-Zawya reports that “[t]he record levels of gold buying by central banks which bolstered the price of the yellow metal in 2018 (Please see our Chart of the Day below) has continued into the first couple of months of 2019, with 51 tonnes bought in February alone. Speaking at the Dubai Precious Metals Conference earlier this month, Ross Norman, CEO of London-based gold bullion broker Sharps Pixley, said that demand from central banks in January and February ‘amounted to 90 tonnes of fresh buying’, which is 61 percent higher than the 56 tonnes bought in the first two months of 2018, and the highest rate of growth since the first two months of 2008.” India announced recently that it plans to add 46.7 tonnes of gold to its reserves in 2019.  India’s additions are part of “a wider picture across developing economies that are looking at de-dollarizing their foreign-exchange reserves,” according to SP Angel, the commodities brokerage (as reported at Scrap Register).

Quote of the Day
“At the quarter-century mark of 1925, the great bull market was under way, and Graham*, then 31, developed what he later described as a ‘bad case of hubris.’ During an early-1929 conversation with business associate Bernard Baruch (about whom he disparagingly observed, ‘He had the vanity that attenuates the greatness of some men’), both agreed that the market had advanced to ‘inordinate heights, that the speculators had gone crazy, that respected investment bankers were indulging in inexcusable high jinks, and that the whole thing would have to end up one day in a major crash.’ Several years later he lamented, ‘What seems really strange now is that I could make a prediction of that kind in all seriousness, yet not have the sense to realize the dangers to which I continued to subject the Account’s capital.’ In mid-1929, the equity in the ‘Account’ was a proud $2,500,000; by the end of 1932, it had shrunk to a mere $375,000.” – Frank K. Martin, A Decade of Delusions

Chart of the Day

Chart note: “Central bank net purchases reached 651.5t in 2018, 74% higher year over year,” says the World Gold Council in its year-end gold demand report. “This is the highest level of annual net purchases since the suspension of dollar convertibility into gold in 1971, and the second highest annual total on record. These institutions now hold nearly 34,000 tonnes of gold. Heightened geopolitical and economic uncertainty throughout the year increasingly drove central banks to diversify their reserves and re-focus their attention on the principal objective of investing in safe and liquid assets.”

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Gold edges higher on sharp increase in oil prices, unemployment claims surge

(USAGOLD – 4-25-2019) – Gold edged higher in a somewhat confused reaction to conflicting reports on the economy and another strong surge in the oil price.  It is trading at $1277 and up $2.50 on the day.  Silver is down 2¢ at $14.90.  The Labor Department reported an unexpected uptick in applications for unemployment, the biggest rise in 19 months.  Contrasting that, durable goods [refrigerators, washing machines, etc] orders rose 2.7%, the largest increase in eight months.  As we go to post today’s report, it seems that oil’s rise is winning the day in the gold market. After a brief drop following the durable goods report, it is back to the upside.

Bert Dohmen, Dohmen Capital Research, offers some contrarian perspective on recent weakness in the gold price. “In 2018, bullish sentiment for gold and silver was at a multi-year low,” he says. “Very few people were interested. That’s usually the time to take a fresh look, technical and fundamental. If everything lines up, my analysis would go against the bearish majority. The chart below [not shown] shows the exposure to gold of managed money in gold futures and options. It shows that the allocation to gold was at its lowest point on this chart in October 2018, at least since 2006. Also important is that in spite the extremely low interest in gold, the gold price (yellow line) in 2018 was higher than at the gold low in 2016. I call this a very important long-term, bullish divergence.”

Quote of the Day
“The ‘threat’ is best seen through the emergence of exchange-traded funds (ETFs), which allow investors to get a proxy physical gold exposure through an investment via their stockbroker. In truth, these products are, in many cases, more expensive than trading and storing physical gold (especially for larger investors with a long-term investment time frame), have less trading flexibility, and are less secure than owning real physical gold.” – Jordan Eliseo, ABC Bullion/Australia

Chart of the Day

Chart note: J.P. Morgan Asset Management released a report recently ranking investments over the past twenty years. It shows gold as the second best performer over the period at a 7.7% average gain annually. REITs were number one at a 9.9% gain. Stocks ranked fourth at 5.6%.

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Gold, silver trading level this morning, ‘delayed lift’ possible on tighter Iran sanctions

(USAGOLD – 4-24-2019) –  Gold and silver are trading level at $1272 and $14.83 per ounce respectively as the U.S. session opens.  No explanation of substance has surfaced with respect to yesterday’s sell-off though both metals did recover much of their early losses during the course of the day. China took the lead overnight in rejecting tighter sanctions on Iran’s crude oil exports. Financial markets, with the notable exception of crude oil itself, have underplayed rising Mideast tensions thus far.

We find ourselves in the same camp with Bloomberg’s Jake Lloyd Smith on the matter. “Gold,” he says, “is due for a delayed lift from the U.S. upping the ante against Iran with the decision to end the sanctions waivers. That move, if enforced, puts a U.S. boot on Tehran’s windpipe and sets the scene for further tensions. Iran is already talking about choking off the Strait of Hormuz, the vital maritime conduit for Persian Gulf shippers. While RBC Capital Markets reckons that the U.S. Fifth Fleet could handle a direct challenge in that area, any flare up would boost both crude and bullion.”

Quote of the Day
“In 2018, bullish sentiment for gold and silver was at a multi-year low. Very few people were interested. That’s usually the time to take a fresh look, technical and fundamental. If everything lines up, my analysis would go against the bearish majority. The chart below shows the exposure to gold of managed money in gold futures and options. It shows that the allocation to gold was at its lowest point on this chart in October 2018, at least since 2006. Also important is that in spite of the extremely low interest in gold, the gold price (yellow line) in 2018 was higher than at the gold low in 2016. I call this a very important long-term, bullish divergence.” – Bert Dohmen, Dohmen Capital Research – Forbes article

Chart of the Day


Chart courtesy of the World Gold Council (GoldHub)

Chart note:  The last time we visited this chart, we noted that managed money net long positions had begun increasing as of December 2018.  The price responded in the first quarter with an uptick.  Since then, managed money long positions have leveled out and the price has been rangebound between $1275 and $1310.  Thus far we have not seen the same level of turnaround in managed money positions that we did in 2016, 2017 and 2018 – something that a number of technical analysts see as a future possibility. In this morning’s Quote of the Day, we feature the thinking of Bert Dohmen (Dohmen’s Capital Research).  “Gold, ” he says in the analysis linked above, “could have a secular bull market until 2030. That means the gold bull market could have about 11 more years to go. Historically, the final phase of a bull market is the most spectacular.”

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold plunges under mysterious circumstances similar to a week ago

(USAGOLD – April 23, 2019) – Gold plunged this morning falling below the $1275 support zone to trade at $1269 – down $6 on the day.  Silver is down 22¢ at $14.81.  Once again the sharp drop occurred in the absence of significant news, at the COMEX open, involving roughly the same volume (a little over $1.5 billion in notional paper gold) and exactly one-week to the hour from the last paper dump April 16th.  We note also that the dollar moved sharply to the upside at the precisely the same moment.

Last time around, we first blamed one or more algo-based trading systems – institutional short sellers attempting to take advantage of a quiet, thinly-traded gold market. We then settled a few days later on the more likely possibility of a paper sale connected to Venezuela’s liquidation of bullion reserves.  Whether or not we will repeat the same sequence this time around remains to be seen. We must admit though to starting out in the same place we did a week ago – in a complete quandary.  Please stay tuned for further updates if more information surfaces.

Above: Chart of the COMEX open, April 16, 2019, with volumes just after the open.
Below:  Chart of the COMEX open, April 23, 2019, with volumes just after the open.

Quote of the Day
“Why does the cycle move as it does? What causes these periodic alternations, this ebb and this flow, in the national priorities? If it is a genuine cycle, the explanation must be primarily internal. Each phase must flow out of the conditions – and contradictions – of the phase before and then itself prepare the way for the next recurrence. A true cycle is self-generating. It cannot be determined, short of catastrophe, by external events. Wars, depressions, inflations may heighten or complicate moods, but the cycle itself rolls on, self-contained, self-sufficient and autonomous. . .The roots of cyclical self sufficiencylies deep in the natural life of humanity. There is a cyclical pattern in organic nature — in the tides, in the seasons, in night and day, in the systole and diastole of the human heart.” – Arthur M. Schlesinger, Jr., The Cycles of American History

Chart of the Day

Chart note: National security advisor John Bolton recently focused attention on the national debt saying that it was “a threat to the society.” The national debt now stands at over $22 trillion and nearly $1.5 trillion was added in 2018. “And that kind of threat,” he added, “ultimately has a national security consequence for it.” An obvious consequence is that interest payments eat up what might otherwise be spent on the national defense. Perhaps that is what has Mr. Bolton worried. As you can see in this final chart of our series on the national debt, there is a strong relationship between growth in the national debt and gold – one that goes all the way back to the early 1970s.

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold level despite new Iran oil sanctions

(USAGOLD – 4-22-2019) – Gold is trading quietly this morning after a minor surge in the overnight markets on reports that the United States was preparing economic sanctions against nation-states that did not halt imports of oil from Iran.  It is level on the day at $1276. Silver is up 4¢ at $15.05.  Brent crude is up 2.5% at $73.70 per barrel.  Iran, in turn, is threatening to close the Straits of Hormuz, the vital choke point for oil shipments from the Middle East.  Things may change as the day progresses and investors reorient themselves after the Easter break.  If so, we will report back. For now though, the markets – with the exception of the energy complex – are reacting rather mildly to what might turn out to be an important turn of events.

Quote of the Day
“The U.S. posted its biggest monthly budget deficit on record last month, amid a 20 percent drop in corporate tax revenue and a boost in spending so far this fiscal year. The budget gap widened to $234 billion in February, compared with a fiscal gap of $215.2 billion a year earlier. That gap surpassed the previous monthly record of $231.7 billion set seven years ago, according to data compiled by Bloomberg. February’s shortfall helped push the deficit for the first five months of the government’s fiscal year to $544.2 billion, up almost 40 percent from the same period the previous year.” – Bloomberg report, 3-22-2019

Chart of the Day

Chart note:  This chart depicts U.S. government receipts and expenditures from 1950 to present.  Note the growing gap between incoming and outgoing – the difference for the most part filled by additions to the national debt.  Given the established trend, that gap in all likelihood would have continued widening without the imposition of the new tax reduction program and simultaneous growth in government spending.  With tax reductions now in place, the distance between the two lines is likely to widen even further.  This is the second last installment in our series on the national debt.  Tomorrow, we will post the final entry.

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Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

No DMR today

Markets are closed today.  Happy Easter to all. . . . .

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Posted in Today's top gold news and opinion |