Gold retraces some of yesterday’s gains, silver marches higher (up 8.3% this week)

(USAGOLD – 7/19/2019) – Gold is retracing some of yesterday’s sudden strong push to the upside that at one point at the metal trading at just under the $1450 mark.  In today’s early going, it is down $6.50 from yesterday’s closing number at $1436.50.  Silver continues to move on its own independent of its usual attachment to gold’s price trend.  It is up 11¢ at $16.45.  Having started the week at $15.19, silver is now up 8.3%.  Gold is up 1.5% on the week.

The basic rationale behind the movement of late in both metals can be reduced to two words – interest rates.  Over the past few days, the top layer of the FOMC – its chairman, vice chairman and president of the New York Federal Reserve – all came out with statements that the central bank needed to be proactive about a rate cut. In turn, we think future data will show, speculators have begun to take the long side of the market, and in some cases, begun to unwind short positions.

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 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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