Price pressure on gold, silver as equities gain Kitco NEWS
Month: November 2020
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Pushing extremes
Seeking Alpha/John Hussman/11-17-2020
“It’s worth understanding that the largest drag on this portfolio mix is the equity component, which is more negative than at any prior point in history. I’m not terribly surprised that Grantham is presently advising a zero allocation to U.S. stocks here. As I noted in last month’s comment, our own measures of market internals indicate that speculators do have the bit in their teeth, but with such extremely overextended technicals and lopsided bullish sentiment that our outlook is essentially neutral, and I continue to view safety nets and tail-risk hedges as essential.”
USAGOLD note: The latest from John Hussman … For the average investor, the best “safety net” and “tail risk hedge,” in our view, is still physical gold and/or silver in the form of coins and bullion. Hussman sees the S&P 500 Index losing two-thirds of its value in the current market cycle.
The post Pushing extremes first appeared on Today’s top gold news and opinion.
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Zombie company debt swells to $1.4 trillion
Bloomberg/Lisa Lee and Tom Contiliano/11-17-2020
“From Boeing Co., Carnival Corp. and Delta Air Lines Inc. to Exxon Mobil Corp. and Macy’s Inc., many of the nation’s most iconic companies aren’t earning enough to cover their interest expenses (a key criterion, as most market experts define it, for zombie status).”
USAGOLD note: Bankrupt companies held aloft by banks that cannot afford to take the hit recognition would deliver to their balance sheets (all supported by Fed quantitative easing policies) …… “They’re a drag on the economy,” reports Bloomberg, “because they keep assets tied up in companies that can’t afford to invest and build their businesses.”
Sources: St. Louis Federal Reserve [FRED], Board of Governors Federal Reserve System
Click to enlarge
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The post https://www.usagold.com/cpmforum/2020/11/315427/ first appeared on Today’s top gold news and opinion.
Daily Wealth/Steve Sjuggerud
“The 1970s and early 1980s saw an extreme spike in inflation. And precious metals prices soared. I tell you that because we’re in a similar situation right now. And it means a long-term gold and silver boom could be underway.”
USAGOLD note: An interesting retrospective that centers around the writings and advice of Howard Ruff who was quite a sensation back in the 1970s. I had the opportunity to meet him back in the day as we were both interviewed for the same television news program – a gentleman and communicator with a knack for making a point without a lot of fluff. The Ruff Times, his newsletter, had a huge following in the 1970s when the newsletter business was in its hey-day.
Repost from 11-13-2020
The post What the 1970s tell us about today’s gold boom first appeared on Today’s top gold news and opinion.
Financial Times/Gillian Tett
“However, the second piece of good news is not so self-evident, and many policymakers would not label it that way at all: there is rising market chatter about the idea that long-dormant inflation risks could return.”
USAGOLD note: Gillian Tett resurrects an old maxim: Inflation tends to rise following recessions simply because of government overshoot on reflation measures. And that overshoot is very much still in progress, as reflected in the chart on MZM immediately below. Gold has been known to prosper under such circumstances in the past.
Source: St. Louis Federal Reserve [FRED] • • • Click to enlarge
Repost from 11-12-2020
The post Gillian Tett: Investors take heed, inflation could return first appeared on Today’s top gold news and opinion.
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