Central Bank Demand for Gold Surging

Central bank demand for gold reportedly hit the highest levels in 2018 since the end of the Bretton Woods system of dollar convertibility in 1971. With some analysts referring to gold as some type of meaningless relic, this begs the question of why the biggest financial institutions on the planet are looking to acquire even more gold. Store of Value Gold has a very long history as a reliable store of wealth and value. In the post-Bretton Woods era and without a return to some... Continue Reading

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The Mueller Report Has Come and Gone… Now What?

The highly anticipated Mueller report has now come and gone. What could have resulted in significant market volatility and a major sell-off has ended up more like a whimper, having little to no impact on markets today. To be clear, however, the report could lead to additional political fighting as Democrats seek to see and release the full report and as other investigations continue. With the special counsel investigation now over, however, investors may again focus their attention elsewhere. The inverted yield curve caught the... Continue Reading

6 Reasons We Could See a Weaker Dollar

As a dollar-denominated commodity, the gold market can be heavily influenced by strength or weakness in the greenback. Dollar strength may weigh on gold as it makes the metal relatively more expensive for foreign buyers, while a weaker dollar may boost the price of gold as it makes the metal relatively less expensive. The relationship between gold and the dollar, and all other paper currencies for that matter, is so important that investors often buy the metal as a hedge against a weaker dollar. Although... Continue Reading

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The Fed’s Towel-Throw Could Spell Trouble for Stocks

At its most recent meeting on monetary policy, the Fed outdid many of even the most dovish expectations. The central bank essentially came out and said – without actually saying it – that trouble for stocks is ahead, and the next recession is approaching. All the Fed’s previous talk about further rate hikes in 2019 and the balance sheet run-off continuing on autopilot were completely wrong. Although the central bank could potentially hike once more in 2020, such a move could be more of a... Continue Reading

How About a Quick 18% Drop in Stocks?

Some analysts have been sounding the alarm bells for a drop in stocks for some time now. Although equities have not thus far fallen apart as some had suggested, the situation has become increasingly cautious. Another analyst recently came out with a call for an 18% drop in stocks. This, however, is one analyst you may want to listen to. His name is Gary Shilling, and he has a knack for calling turning points in the economy. Having called major turns in the 60s, then... Continue Reading

It’s a Classic Bull Trap

Stocks have again found their winning ways in recent weeks but it’s likely all a classic bull trap… After a rough end to 2018, the markets have been moving higher even as a U.S./China trade deal remains elusive. The benchmark S&P 500 is once again challenging resistance around the 2800 level, and some investors are hopeful that the market will stage an upside breakout and embark on a fresh leg higher into a new all-time high territory. However, investors may be very disappointed if the... Continue Reading

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EU Slowdown May Be Worse Than Expected

It’s no secret that the Eurozone continues to struggle with a slow economy. The EU has seen many of the ups and downs that have been seen in the U.S. in recent years while also having to contend with numerous other issues such as massive sovereign debts and policy disagreements. Now, the ECB has slashed its growth and inflation forecasts for the year while also lowering the outlook for 2020 and 2021. This would seemingly acknowledge the fact that the slowdown being seen in Europe... Continue Reading

U.S. Treasury Taking Steps to Avoid Debt Ceiling

As U.S. debt has soared past the $22 trillion level, the ongoing problem is once again catching some attention. It was recently reported that the Treasury Department is taking some extraordinary measures to avoid violating the debt ceiling as it could have significant effects. Reuters reported that Treasury Secretary Steve Mnuchin sent a letter to House Speak Nancy Pelosi on Monday saying he was suspending investment in the Civil Service Retirement and Disability Fund and that a “debt issuance suspension period” would commence on Monday... Continue Reading

The Dollar Is Going Down

Is a significant dollar decline in the future? Over the weekend, Fed Chairman Jerome Powell was interviewed by CBS’ “60 Minutes” and discussed a range of topics. The Fed chief has been widely criticized by U.S. President Donald Trump (who appointed Powell) in recent months over the central bank’s plans to normalize monetary policy through interest rate hikes. Under Powell, the Fed raised interest rates four times in 2018 and could look to hike them further in the months ahead. The central bank began the... Continue Reading

The Geopolitical Landscape Could Get Worse

There has been no shortage of issues for global financial markets to grapple with over the last several months. Not only does the U.S. has numerous domestic challenges to deal with, the country is also involved in some high-stakes disagreements on the international stage and will need to closely monitor others. The geopolitical landscape could get worse. A lot worse. Here are three major issues that have the potential to hit global financial markets hard and fuel a significant flight to safety: North Korean Nuclear... Continue Reading