Author Archive: GoldSilverWorlds
DOJ Gives Epstein-like Slap on the Wrist to JPMorgan Chase
Gold and silver investors may have little in common with Jeffrey Epstein’s teenage victims or violent “Black Lives Matter” rioters, but there is one issue upon which they might all agree. Our system of justice often fails. Department of Justice officials refuse to apply the rule of law fairly. Their dereliction of duty is crushing confidence and generating outrage. Last week, the DOJ ended the criminal prosecution of JPMorgan Chase bank, settling for a $1 billion fine. No high-level executives will be sent to prison, and the bank’s trading privileges will not be limited in any way. Bank executives will simply write a check equivalent to less than 3% of 2019 net […]
Why Did Precious Metals Get Clobbered This Week?
Precious metals markets got clobbered early this week as gold and silver broke down from their high-level consolidations. Strength in the U.S. Dollar Index seemed to be the catalyst that got the selling going. Once key technical levels got breached, the selling intensified. Gold prices fell below the $1,900 level on Wednesday. Meanwhile, silver plummeted below $24 an ounce and traded as low as $22 on Thursday before recouping some of those losses by the end of the trading day. Some of the volatility seen in metals and equity markets in recent days is attributable to the failure of Congress and the White House to agree on a new stimulus […]
Gold and Silver Are Still Locked and Loaded… Don’t be Out of Ammo
In military terms, the phrase “locked and loaded” refers to “locking” a magazine or cartridge into a firearm and loading a round into the gun’s chamber. A variant is to “lock the safety” and then load a magazine into the weapon. The analogy in his essay is that from a technical (chart) standpoint, the price of gold and silver are building energy to the point that they are getting closer and closer to breaking out of a consolidation pattern and beginning the next impulse in the bullish sequence of higher highs and higher lows. The pullback this week does not negate the outlook for higher prices in the coming weeks […]
Beware of These Faulty “Inflation Protected” Investments
The Federal Reserve last week reiterated its commitment to an unprecedented inflation-raising campaign. Specifically, the Fed aims to push the inflation rate above 2% for an extended period. The risk for investors is that central bankers succeed in their mission to depreciate the currency more rapidly – perhaps even more rapidly than intended or acknowledged in the official (understated) inflation data. Inflation is a corrosive force that eats away at the real value of savings and investments. It is perhaps the biggest threat looming on the horizon for millions of retirees who have been steered into assets marketed as “conservative” – such as dollar-denominated money market accounts, bonds, and fixed […]
Central Banking Cartel Promises ZIRP Until at Least 2023
Gold and silver investors who were hoping Wednesday’s FOMC meeting would be a catalyst for a major breakout move were largely disappointed. The metals complex didn’t see an immediate boost from the Federal Reserve’s dovish policy meeting. Still, the central bank’s commitment to an accommodative monetary policy is set to play out not just over the course of a week, but of years to come. On Wednesday, the Federal Reserve announced it would continue to hold its benchmark interest rate near zero. That came as no surprise. However, the extent of the Fed’s commitment to avoid any rate hikes in the future raised the eyebrows of many veteran observers of […]
Chaos 2020: Will Markets Melt Down If No One Concedes the Election?
As pundits weigh in daily on who has the edge in this year’s political horserace, investors want to know how the election will affect their pocketbook. It could affect it in a big way. A major disruptive threat looms in the 2020 election like no other in recent history. It’s not that one candidate or the other would be uniquely bad for markets. Wall Street could be okay with either a Trump or a Biden victory, albeit probably for different reasons. Both candidates are by now totally familiar. And despite their significant policy differences, either Trump or Biden would be tolerable from the standpoint of America’s biggest corporations – many […]
Billionaire Hedge Fund Manager Warns of 10% Inflation
Over the past month, gold has traded in a range with support around $1,900. Bulls have made a couple unsuccessful attempts to retake and hold above the $2,000 level following the sharp plunge below it on August 11th. But we are likely to see a more decisive move in the gold market one way or the other in the days ahead. The near-term outlook for precious metals markets may be determined by where the U.S. Dollar Index heads next. It has been basing out since August after trending lower earlier in the summer. The Federal Reserve Note appreciated modestly against foreign currencies ahead of the European Central Bank’s policy meeting […]
China Unloads Dollars as Gold Tests Support
Since posting new record highs in early August, the gold market has consolidated above $1,900/oz support. A close below the $1,900 level would carry bearish implications for the near term. Alternatively, a move back above $2,000/oz would likely be followed through to the upside with a rally to fresh highs. Silver, in turn, could be expected to run to new multi-year highs above $30/oz. These breakouts will happen eventually. The relentless mega trend of dollar depreciation (i.e., inflation) ensures hard money will gain value versus fiat Federal Reserve notes. The question is whether a deeper correction occurs first… or the major trend accelerates. Inflation rates may be set to accelerate […]
Gold & Silver Shine as Fed Targets Bondholders for Capital Losses
As the tech-heavy stock market indexes sold off on Thursday, many investors were forced to re-think their positions. For the past few months, mega cap technology companies like Apple, Amazon, and Tesla have led the market higher. Yesterday they led the market lower. Now the question is: Where can investors look for leadership going forward? As would be expected during big down days for equities, gold held up relatively better. For the week, though, gold, silver, and platinum prices are all down. Palladium has certainly shown leadership within the metals space in recent years. But despite this week’s gains, palladium prices still sit below their highs from February. And despite […]
Pension Funds Start Looking to Gold to Avert Disaster
Public and private pension plans face a dual crisis. The first and most obvious threat to pensioners is that defined-benefit vehicles are severely underfunded. By one estimate, pension systems taken as a whole are $638 billion in the red. Some are in better shape financially than others. But all pension plans will have to reckon with a second huge challenge going forward. Namely, they are already entirely unable to meet their stated return objectives by owning conventional “safe” interest-bearing instruments such as Treasury bonds. Fed Declares War on Savers The Federal Reserve has effectively declared war on savers by vowing to hold short-term interest rates near zero, likely for years […]
How Will the Election Impact the Bullion Market?
Bullion investors took a breather when Donald Trump was elected in 2016. Demand for coins, rounds, and bars fell significantly on the day after election day and stayed down for the next 3 years. After 8 years of Barack Obama, ultra-loose fed policy and a historic run-up in the national debt, investors felt things would get better under Trump. Today, as we near the end of Trump’s first term, demand for physical precious metals has spiked. The COVID scare and the associated monetary and fiscal stimulus coupled with widespread social unrest has gold and silver bugs stocking up once again. Along with them, an entirely new wave of investors and […]
Fed Chairman Powell Is Vowing to Wreck the Currency
As the Federal Reserve embarks on a new campaign to raise inflation rates, markets may be in for a change in character. On Wednesday, Fed Chairman Jerome Powell announced that the central bank would be targeting an inflation “average” of 2%. By the Fed’s measures, inflation has been running below 2% in recent years. So, getting to a 2% average in the years ahead will require above 2% inflation for a significant period. Here’s Powell attempting to explain himself from central bankers’ virtual Jackson Hole conference: Jerome Powell: Our statement emphasizes that our actions to achieve both sides of our dual mandate will be most effective if longer term inflation […]
The New Red Peril Represents a Golden Opportunity
Contrary to much politically motivated, media-fueled paranoia about Russia, the former Soviet Union – with a shrinking population and a GDP smaller than the market capitalization of Apple – poses no serious threat to U.S. economic preeminence. China, by contrast, is a rising superpower that could in time topple the U.S. dollar’s world reserve status. That could also signal the end of U.S. geopolitical hegemony. The Chinese Communist Party is playing a long game. Even as conflicts with the administration of President Donald Trump escalate on multiple fronts, Chinese officials are looking ahead to a post-Trump world order. President Trump said in a Fox News interview Sunday, “If Biden is […]
Bullion Markets Catch a Breath
Gold bugs may finally be taking their summer (stay)vacation. After months of frenetic activity in the bullion markets, physical buying and selling slowed a bit last week. The respite, if it persists, could be welcome news for investors who have been frustrated by product scarcity and higher premiums. The COVID-19-associated economic troubles have not been resolved, but those stories aren’t commanding the level of attention they did in recent weeks. Angry rioting and looting have slowed for the moment. The Fed is in between rate cuts and the next announcement of additional stimulus. And there is almost nobody left in Washington DC or the media willing to talk about multi-trillion-dollar […]
