Best of the Week
Most Popular
1. US Housing Market House Prices Bull Market Trend Current State - Nadeem_Walayat
2.Gold and Silver End of Week Technical, CoT and Fundamental Status - Gary_Tanashian
3.Stock Market Dow Trend Forecast - April Update - Nadeem_Walayat
4.When Will the Stock Market’s Rally Stop? - Troy_Bombardia
5.Russia and China Intend to Drain the West of Its Gold - MoneyMetals
6.BAIDU (BIDU) - Top 10 Artificial Intelligence Stocks Investing To Profit from AI Mega-trend - Nadeem_Walayat
7.Stop Feeding the Chinese Empire - ‘Belt and Road’ Trojan Horse - Richard_Mills
8.Stock Market US China Trade War Panic! Trend Forecast May 2019 Update - Nadeem_Walayat
9.US China Trade Impasse Threatens US Lithium, Rare Earth Imports - Richard_Mills
10.How to Invest in AI Stocks to Profit from the Machine Intelligence Mega-trend - Nadeem_Walayat
Last 7 days
Eye Opening Currency Charts – Why Precious Metals Are Falling - 23rd May 19
Netflix Has 175 Days Left to Pull Off a Miracle… or It’s All Over - 23rd May 19
Capitalism Works, Ravenous Capitalism Doesn’t - 23rd May 19
The Euro Is Bidding Its Time: A Reversal at Hand? - 23rd May 19
Gold Demand Rose 7% in Q1 2019. A Launching Pad Higher for Gold? - 23rd May 19
Global Economic Tensions Translate Into Oil Price Volatility - 22nd May 19
The Coming Pension Crisis Is So Big That It’s a Problem for Everyone - 22nd May 19
Crude Oil, Hot Stocks, and Currencies – Markets III - 22nd May 19
The No.1 Energy Stock for 2019 - 22nd May 19
Brexit Party and Lib-Dems Pull Further Away from Labour and Tories in Latest Opinion Polls - 22nd May 19
The Deep State vs Donald Trump - US vs Them Part 2 - 21st May 19
Deep State & Financial Powers Worry about Alternative Currencies - 21st May 19
Gold’s Exciting Boredom - 21st May 19
Trade War Fears Again, Will Stocks Resume the Downtrend? - 21st May 19
Buffett Mistake Costs Him $4.3 Billion This Year—Here’s What Every Investor Can Learn from It - 21st May 19
Dow Stock Market Trend Forecast 2019 May Update - Video - 20th May 19
A Brief History of Financial Entropy - 20th May 19
Gold, MMT, Fiat Money Inflation In France - 20th May 19
WAR - Us versus Them Narrative - 20th May 19
US - Iran War Safe-haven Reasons to Own Gold - 20th May 19
How long does Google have to reference a website? - 20th May 19
Tory Leadership Contest - Will Michael Gove Stab Boris Johnson in the Back Again? - 19th May 19
Stock Market Counter-trend Rally - 19th May 19
Will Stock Market “Sell in May, Go Away” Lead to a Correction… or a Crash? - 19th May 19
US vs. Global Stocks Sector Rotation – What Next? Part 1 - 19th May 19
BrExit Party EarthQuake Could Win it 150 MP's at Next UK General Election! - 18th May 19
Dow Stock Market Trend Forecast 2019 May Update - 18th May 19
US Economy to Die a Traditional Death… Inflation Is Going to Move Higher - 18th May 19
Trump’s Trade War Is Good for These 3 Dividend Stocks - 18th May 19
GDX Gold Mining Stocks Fundamentals Update - 17th May 19
Stock Markets Rally Hard – Is The Volatility Move Over? - 17th May 19
The Use of Technical Analysis for Forex Traders - 17th May 19
Brexit Party Set to Storm EU Parliament Elections - Seats Forecast - 17th May 19
Is the Trade War a Catalyst for Gold? - 17th May 19
This Is a Recession Indicator No One Is Talking About—and It’s Flashing Red - 17th May 19
War! Good or Bad for Stocks? - 17th May 19
How Many Seats Will Brexit Party Win - EU Parliament Elections Forecast 2019 - 16th May 19
It’s Not Technology but the Fed That Is Taking Away Jobs - 16th May 19
Learn to Protect your Forex Trading Capital - 16th May 19
Gold Ratio Charts Offer The Keys to the Bull Market - 16th May 19
Is Someone Secretly Smashing the Stock Market at Night? - 16th May 19

Market Oracle FREE Newsletter

U.S. House Prices Analysis and Trend Forecast 2019 to 2021

Market Volatility Skyrocketing, Trump & Pelosi Spar

Stock-Markets / Stock Markets 2019 Jan 06, 2019 - 08:05 AM GMT

By: MoneyMetals

Stock-Markets

Precious metals markets are off to a strong start in 2019. Gold and silver both closed Thursday at multi-month highs as the stock market reversed sharply to the downside.

Investors were disappointed by manufacturing data showing a slowdown in industrial output. They dumped economically sensitive stocks and bid the U.S. dollar lower on foreign currency exchanges. Markets now expect the Federal Reserve to pause its rate hiking campaign and possibly even begin cutting rates later this year.

The weaker dollar helped boost crude oil and precious metals prices. The energy and mining sectors are among the only gainers in the stock market. The HUI gold miners index closed at a 5-month high on Thursday.


As for gold itself, it’s down a bit today with spot prices currently coming in at $1,284 per ounce, now up a mere 0.1% this week. The physical gold market is likely to tighten this year. Analysts at Refinitiv GFMS project gold mining output will decrease slightly – from approximately 3,282 tonnes in 2018 to 3,266 tonnes in 2019.

Physical silver could also see pressure from diminished mining capacity and rising investment demand as prices recover and attract more mainstream attention. Silver shows a gain of 1.9% this week to trade at $15.72 as of this Friday morning recording.

Platinum is up 2.6% to $817 an ounce. And finally, palladium continues to stay hot after putting in a record breaking 2018. It’s having a great day so far today and is now up 3.9% in the first week of trading of 2019 to come in at $1,308.

Well, as if investors didn’t already have enough to worry about, on Thursday Nancy Pelosi was sworn in as the new Speaker of the House. Of course, there’s nothing “new” about Nancy Pelosi or her ideas. She has been representing San Francisco and its values in Congress for over three decades.

What is new is the growing contingent of avowed socialists within her ranks who are pushing her to endorse Medicare for all, “green” jobs for the politically connected, and a long list of other giveaways…plus the impeachment of Donald Trump and amnesty for illegal aliens.

Speaker Pelosi’s first task will be more mundane – find a way to get the government reopened. She is in the difficult position of trying to negotiate a deal that will be acceptable to her left flank as well as President Trump.

No such deal appears to be forthcoming anytime soon as both sides dig in for a fight. For his part, President Trump graciously reached out to the new Speaker and struck an optimistic tone. But Speaker Pelosi doesn’t appear willing to give Trump anything for his signature issue of a border wall.

Donald Trump: I just want to start off by congratulating Nancy Pelosi on being elected speaker of the house. It's a very, very great achievement, and hopefully we're going to work together and we're going to get lots of things done, like infrastructure, and so much more. I know they want to do that very badly, so do I. So, hopefully we're going to have a lot of things that we can get done together, and I think it's actually going to work out. I think it'll be a little bit different than a lot of people are thinking.

CBS Reporter: Are you willing to come up and give him some of this money for the wall?

Nancy Pelosi: No.

CBS Reporter: Because apparently that's the sticking point.

Nancy Pelosi: No, nothing for the wall. No, how many more times can we say no? Nothing for the wall.

In the strange political spectacle that is the government shutdown fight, neither side actually cares about the $5 billion President Trump wants for border security. It’s not about the money.

If fiscal responsibility were the issue, Democrats and Republicans wouldn’t be talking about a massive bipartisan infrastructure bill. The government wouldn’t be set to spend $4.4 trillion in the current fiscal year. The government wouldn’t be set to run a budget deficit of $1 trillion. Adding or subtracting $5 billion for a wall or a see-through fence of the sort that Democrats supported under previous administrations changes nothing about the dangerous fiscal trajectory of the country.

A reckoning is coming. Maybe not in 2019. But almost certainly by the mid 2020s, some kind of funding crisis will hit. It will make both sides wish it was artificial political theater like the current shutdown is.

In a few short years, waves of retiring Baby Boomers will drain Medicare and Social Security. The programs will require a massive multi-trillion dollar bailout. But the government will likely be running routine annual budget deficits of over $1 trillion. It will be carrying a growing debt-to-GDP ratio spiraling toward third world levels that historically trigger default or hyperinflation.

Under our fiat monetary system, though, a debt default is entirely avoidable. That’s the good news for politicians. The bad news for the rest of us is that when the Federal Reserve’s printing press becomes fully engaged to monetize U.S. debt, the value of the dollar will continue to fall against tangible assets. The prices for everything we buy will skyrocket even faster.

Such a scenario may still be a few years away. But it is difficult to see how it could ultimately be avoided.

Before the debt crisis turns into a currency crisis, precious metals markets will reflect the gathering threats. There are already enough threats from a gyrating stock market, a dysfunctional political system, and an unconstrained monetary system to potentially help make 2019 a big year in the gold and silver markets.

By Mike Gleason

MoneyMetals.com

Mike Gleason is President of Money Metals Exchange, the national precious metals company named 2015 "Dealer of the Year" in the United States by an independent global ratings group. A graduate of the University of Florida, Gleason is a seasoned business leader, investor, political strategist, and grassroots activist. Gleason has frequently appeared on national television networks such as CNN, FoxNews, and CNBC, and his writings have appeared in hundreds of publications such as the Wall Street Journal, Detroit News, Washington Times, and National Review.

© 2019 Mike Gleason - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules