Happy 2nd Birthday Bail-in Tool! We Suggest Gold As The Perfect Gift

Happy 2nd Birthday Bail-in Tool! We Suggest Gold As The Perfect Gift
– Two years since bail-in rules officially entered EU regulations
– EU bail-in rules have wiped out billions for savers and and businesses, with more at risk
– Future of many failing banks now rests on depositors who may no longer be protected by deposit insurance
– Physical gold enables savers to stay out of banking system and reduce exposure to bail-ins
– For more listen to our Goldnomics Podcast: What does 2018 have in store for financial markets?
Ah, New Year’s resolutions, what fun. For some reason we opt to commit to fairly big life changes at some point between Christmas and New Year. This is a time when the real world seems a lifetime away from the cosiness of the holiday season. We often make a resolution when we have had too much of something, perhaps booze, perhaps food or perhaps it is based on regrets from the previous year. Despite best intentions, rarely do we stick to them.
May we make a suggestion? If you’re going to make any resolutions this year make one that is pretty easy to stick to and that won’t make too much of a short-term impact on your life: resolve to pay attention to and to protect yourself from the threat that is ECB bail-in tools. In the long-term you’ll be more grateful you did this than if you had given up cursing or drinking for a month.

This post was published at Gold Core on December 29, 2017.

Bubble Watch: The Fed KNOWS We’re in a 1999-Type Mania

The Fed raised rates another 0.25% the week before last.
This marks the 5th rate hike since the Fed embarked on its policy tightening in December 2015 and the fourth rate hike in the last 12 months. The Fed’s latest statement also indicates it plans on raising rates three more times in 2018.
It is easy to gloss over the significance of this, but the Fed’s actions are indeed unusual; other major Central Banks (the Swiss National Bank, Bank of Japan, European Central Bank and Bank of England) are all currently running QE programs (the BoJ, ECB and BoE) or openly printing new money to buy stocks outright (the SNB).
What precisely is the Fed doing? Why the urge to tighten when other banks are all printing new money by the billions?
The following quotes from Fed offer us clues.
Fed Monetary Policy Report, June 2017:
‘Forward price-to-earnings ratios for equities have increased to a level well above their median of the past three decades,
Fed minutes, July 2017:

This post was published at GoldSeek on 26 December 2017.

Citi: ‘What If?…”

One month ago, Citi’s credit team laid out its outlook for the coming year in what – in our opinion – was one of the gloomiest reports for the coming year, and included the following fascinating revelation according to which central bankers appears to have lost control: “That seems to be a growing fear among a number of central bankers that we have spoken to recently. In our experience, they too are somewhat baffled by the lack of volatility and concerned about the lack of response to negative headlines…. Our guess is that sooner or later in the process of retrenchment they will end up going too far – though that will only be obvious with hindsight.” As we said at the time, “frankly, that’s about the scariest admission from one of the world’s biggest banks that we have read in a long time.”
And while Citi’s “base case” was clearly bearish (our summary can be found here) – what was left unsaid was even more interesting, if not troubling. As the bank’s credit team writes “what about the outcomes that didn’t quite make it into our base case? The scenarios that aren’t central, but which aren’t entirely implausible either – both bullish and bearish.
So ‘What if…’:
idiosyncratic risk is returning to credit? European corporates get more aggressive? global growth & commodity prices disappoint? inflation accelerates as output gaps close? the US yield curve inverts? central bank tapering really is a non-event? the market doesn’t like the choice of ECB successor?”

This post was published at Zero Hedge on Dec 24, 2017.

Fed Rate Rise Sees Gold Price Jump $10 as UK and ECB Hold Despite Rising Inflation

Gold prices rose further in London trade Thursday, gaining $20 per ounce from this week’s 5-month lows after the US Federal Reserve raised its key interest rate as expected.
After UK inflation came in at a 6-year high of 3.1%, the Bank of England today voted unanimously to hold its key interest rate at a near record-low of 0.5%.
With annual inflation in Germany reaching 1.8% in its strongest year since 2012, the European Central Bank then said it’s keeping deposit rates at minus 0.4% for commercial banks, while extending its new quantitative easing asset purchases at a monthly pace of 30 billion per month until at least September 2018.
“Economic conditions will evolve in a manner that will warrant gradual increases in [interest rates],” said the Federal Reserve on Wednesday, taking the overnight Fed Funds rate up a quarter-point to 1.50% at the last major meeting chaired by Janet Yellen before current governor Jerome Powell takes over in February.

This post was published at FinancialSense on 12/14/2017.

Asian Metals Market Update: December-14-2017

Traders had priced in four interest rate hikes for next year. The Federal Reserve says three. This resulted in the US dollar falling and gold and silver getting a boost. All is not over. The European central bank and the Bank of England meetings can affect the markets. America’s growth outlook for 2018 has been raised. If the ECB and BOE also raise their growth forecast for next year, then the US dollar could see another sell off and gold and silver could get back some of the lost investor confidence.
The lower base for US nonfarm payrolls for next year is 140,000. The US economy needs to continuously add 140,000 NFP every month to ensure the case for an interest rate hike every quarter. Next year there is a competition between the USA, the UK and the Eurozone on growth versus interest rate. The Eurozone has imported migrants from Africa and Asia for higher growth. Migrants will ensure that Eurozone growth beats American and UK. Eurozone member nations are distributing free money to the migrants just to support their ‘too big too fail’ corporations. This is a very disturbing practice and a self-destructive practice. Gold and other non US dollar alternates will zoom.
Everyone says bitcoin and other crypto currencies are not backed by anything. I ask everyone was the US dollar backed by anything when it started after the First World War. The US dollar is just backed by a heavily indebted nation currently. Nations are supporting the US dollar as they have invested heavily in US bond markets. If the USA sinks a lot of nations will become bankrupt. There will be mass unrest globally. With bitcoin and other crypto currencies, it is just a starting point to replace the US dollar and other paper currencies. Over a period of time as central banks start supporting it, bitcoin and crypto currencies will be backed by nation’s physical assets.

This post was published at GoldSeek on 14 December 2017.