Guest Post by Jesse
The markets were roiled today by comments from the Trump Administration. The first was that the weaker dollar is good for trade, which sent the US Dollar into a tailspin, falling down on the DX level to a new recent low of 89. And the second was some comments on the unfairness of trade with China, which fanned fresh concerns about a ‘hot trade war.’
The Donald will be addressing the World Economic Forum in Davos on Friday, and will be arriving there tomorrow.
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If the House Republicans, largely from the Freedom Caucus, do indeed have a memo written by member Devin Nunes that contains remarkable information about corruption and whatever else they claim, then let them release it.
But to waive a secret memo in the air, while using it to justify all sorts of serious charges against an institution that is investigating some of their own for a different type of corruption, while maintaining it as secret, is questionable to say the least. And unworthy of a high official of the public trust.
And on the other hand, there are the histrionics of the Democrats and their courtiers in the media, sounding the alarm about ‘Russian collusion’ attempting to subvert the recent election, without producing any real proof that such a thing had even occurred in any substantial manner. And if one notes that the evidence has not be produced, they themselves are attacked as disloyal, and under the influence of a foreign power.
As I predicted long ago, if there is a crime here it is probably money-laundering having its roots in NY real estate deals over a long period of time involving Russian oligarchs. And ironically, Hillary and her significant other had their same paws in similar purses.
How can we not think of Senator McCarthy, waving his infamous secret list of Communists in the State Department, which he never released, but used as a bludgeon on the institutions of the government, and as a tool to inflame the public, and subvert the objective course of justice.
Perhaps we need to vote most of these unworthies out of office, and replace them with mature adults who will conduct themselves in the service of the public, and provide a much better example for the people, and especially for those younger among us. And if the two political parties are too set in their ways, too comfortable in their excesses to change, then we may need to reform or replace the two political parties with a third.
Gold and silver were on a tear higher today as the US dollar was slumping. And stocks were wobbly, for the very good reason that they are overvalued, and that their underpinnings are weak to say the least.
Let’s see if the metals can hold their ground into the Comex Options expiration tomorrow, and if any fresh statements come out of Davos, that may shake up the calm of the financial markets.
People are always given to excess. We may strike out on a good path, but too often it becomes an excess when it serves the private interests of some at the expense of others.
This is why we create laws, and institutions to uphold them. And even these are suseceptible to the same abuses being, after all, human institutions.
And so it is a never ending struggle, to maintain justice, and peace, and equality, against those forces that would pervert it for their own ends. And that same struggle exists within ourselves, as we struggle to hold on to our humanity, and keep the fires of the love of virtue alive in our hearts, even in times of abundant wickedness. Far be it from us to fall into the same worldly abyss of abuses by the forces of darkness against the light.
Why would anyone wearing the Sweater of Power let anyone grab the loose string and unravel what’s left?
Only the illusion of control backed by raw power is left, and when that is gone, only raw power remains.
And that scares people more than the illusion.
“The first was that the weaker dollar is good for trade, which sent the US Dollar into a tailspin, falling down on the DX level to a new recent low of 89. And the second was some comments on the unfairness of trade with China, which fanned fresh concerns about a ‘hot trade war.’”
A weaker dollar means that it is cheaper for people from other countries to buy American goods. This is a good thing because if the price of American products gets competitively priced, then manufacturing and jobs will increase in the USA.
I believe ‘Make America Great Again’ means that we have to have trade wars so that we can start manufacturing in the USA again. The middle class can be rejuvenated if we stop buying stuff from China and instead make it ourselves. A win-win.
Trade wars never end well. Yes, we should all quit buying crap from China. With the quick buck mentality of wall street, it’s profit this quarter that counts, hence offshoring. In the long run however you kill the economy which can afford to buy any products from anywhere. This myopic course leaves us broke and without a manufacturing base. Buy US where ever possible, your neighbors benefit, not China, duh.
” trade wars never end well.” Stop repeating mush you heard on CNBC. For the winner they do.
And who is the winner going to be starfcker? How much of our industrial base has departed? The tit for tat repercussions insure all are essentially losers or do you subscribe to the “he who has the most toys at death wins” empty victory. China gets too pissed and dumps US Treasuries crashing our economy. Sure China takes a massive hit too. Some victory. China also holds a monopoly of the earth’s RREs (rare earth elements) essential to many military and industrial uses in the good ol’ US of A which are critical to US national security elements like weapons systems, mobile devices and emerging green technologies. Ad nauseam. There isn’t too much winning in the lose lose game.
Now go back in your hole and continue endlessly reliving the night you got a stinky finger from Annette Funicello’s 2nd cousin making you the great STARFCKER-bwwaaaaa
If China dumped the US Treasuries they hold, the Fed would buy them – if needed. This would leave China holding roughly $1.2 trillion in cash.
What would they do with it? American politicians aren’t *that* expensive.
Worthless corporate bonds? Might be entertaining at some point.
Gold? Maybe.
Walmart and Amazon? Vertically integrating the Chinese-crap-to-American-consumer pipeline? They would still have a lot of money to spend after this. In fact, they could buy 5-6% of each firm in the S&P 500. This would probably be the funniest possibility.
I’m not sure the Chinese wouldn’t get hurt worse than we would be, by the liquidation of their Treasury bond holdings.
While I agree with most of what you say, unfortunately the weaker dollar does have a unfortunate side effect, higher commodity prices. The Fed has printed so much money in the last 9 years that it has diluted our money terribly. The weak dollar will bring back jobs to this country, however a weaker dollar also may mean that your gas, home heating, electricity and other consumables (that can’t be printed out of thin air) will be more expensive. Depends if Trump can get us to where a large portion of our energy (all forms) is produced here and not by foreign entities. If we can get to a point where we are self sufficient as a country, then the relative value of the dollar to other currencies won’t make a lot of difference. The transition may be difficult though…
“Gold and silver were on a tear higher today as the US dollar was slumping. And stocks were wobbly, for the very good reason that they are overvalued, and that their underpinnings are weak to say the least.
Let’s see if the metals can hold their ground into the Comex Options expiration tomorrow, and if any fresh statements come out of Davos, that may shake up the calm of the financial markets.”
True, that if you’ve been out of stocks and long on metals since 2008, you’ve seen metals go sideways, while the stock market ran higher. But, they are different. Stocks are investments.
Bears are looking at P/E ratios out of whack, and the FANG stock leaders as warnings.
Stock bears have been wrong with their predictions. Going on 8-9 years now. Hmmmm…..
Metals are wealth preservation savings, with potential to realize huge investment returns.
07:30 a.m EST:
Au spot: $1358
Ag spot: $ 17.50
If these creep to $1380 or 1400 for gold, and $18-19 for silver, it could arguably be a significant signal. If I understand the dynamics correctly, metals advocates
suspect it will be business as usual, where paper contracts and market short sells placed in large volume contracts will have the usual effect of driving spot prices back down lower.
Who does this? The suspicion is large name banks (GS, Citi, Deutsche, JPM, etc.) on behalf of the central banks. Reason: Metals prices have to be kept low, or confidence loss in fiats means huge loss of paper wealth, a tanking in most other financial markets, and a loss of control.
There are something like 80+ paper claims for every 1 oz. of physical gold available to settle.
If the shorts sellers ever get called to deliver physical, the scramble will be on to get hold of physical, and spot prices will begin a slow, steady march higher.
Here is why the metals suppliers advocate buying physical, instead of paper claims on gold in the form of ETF’s. Likewise, many have warned to take delivery, or use secure storage vaults outside of the banking system, and outside one’s home country, if possible.
Purpose: If the banking system implodes, you’re SOL to retrieve holdings, and most banks specifically disallow placing cash and precious metals in safe deposit boxes. Midnight gardening, anyone?
Outside the country is further insulation from the grubbing hands of gov. confiscation, if all hell breaks loose in a scramble for assets. Remember the bail ins over in Cyprus. Never, in the USA, right?
Curveball: As other markets see huge losses accelerate, metals price climbs may reverse, indicating a false alarm, and late comers who jumped on metals purchases to catch a rising wave will experience immediate losses, and regrettably sell their metals, adding more supply to the market.
A shakeout of weak players, as investors in other markets see losses build up, they may turn and sell metals holdings to recover, which also gooses supply, thereby driving spot prices lower.
But, if other markets continue tanking, metals prices would reverse and go higher again, with the potential to go vertical, in a mad rush to exit the other market losses, and scramble to get on board w/ rising metals prices again.
Another part of the education for me was, metals purchases were not to invest, or buy, in the hopes spot prices climb higher, then sell, to realize an investment gain. The primary purpose is as a means to SAVE, as a form of wealth storage and preservation, as fiats erode with their purchase power.
Crypto currencies are an alternate, if one believes in those, over metals. Roll the dice. Place your bets.
We know our $USD doesn’t buy what it used to. The value of goods sure has demanded increasingly more dollars throughout history, with the common mistake of thinking inflation is a rise in prices. Most in the know realize as the money supply is inflated, it decreases its purchasing power, and rising prices for goods or smaller, cheapening of consumables are the EFFECTS.
Back in the early 1900’s, a man could buy an exceptionally high quality suit and pair of shoes for an oz. of gold. Still holds true today. But back then, a quality suit and shoes cost maybe $20 -$30. And the required amount of $USD to purchase an oz. of gold: the same.
Now: $1350 will buy you a real fine suit and a sweet pair of leather dress shoes.
And, coincidentally, $1400 USD are required to buy a beautiful .9999 pure gold Buffalo at a coin shop near you, or online. (Coins have a premium, to basic bullion ounce spot prices)
But, the naysayers, like Keynesians Krugman and Bernanke believe gold is a relic.
W. Buffet: “You dig it up out of the ground, pay for it, then bury it back in the ground for safekeeping
so, it’s not an investment that works well for me”
And if Au is out of your price range, seek out it’s lower cost sibling, Ag. Eagles are beautiful, too.
Cheaper yet: Pre-1964 ‘junk’ silver is not junk at all. It’s treasure. Get yourself some.
Can’t hurt, and they are nice to hold, feel, and look at.
If the doom and gloom comes to pass, metals might buy you some things of real value,
where your fiat, and your stock in Tesla just might be worthless.
Time will tell. The problem with predictions, is trying to nail down the “when”, not the “what”
that is projected to occur.
AIN’T GUNNA HAPPEN. It will continue to be . . . “BAU” (business as usual) – corruption and fraud SELECTIVELY “enforced”. The more One thinks things change, in the actuality of time, the more they really stay the same. Big-ass wars have been and will [most likely continue to] be the ultimate arbiter of social/political, economic and financial “REsettlements”.
This is clearly criminal intent!!!!
Prosecute the fucking thieves!!!!!
End the Fed!!!! MAGA WILL NEVER BE UNTIL THE BEAST IS DEAD!
https://www.zerohedge.com/news/2018-01-25/it-frankly-scary-bill-white-warns-global-financial-system-faces-perfect-storm
For the record:
McCarthy was right. The State Dept. WAS infested with traitors. Released Soviet docs prove it.
Sundance, at his Conservative Treehouse website, has a good analysis on ‘The Memo’. It is not as Adam Schiff and the media believe, based on Nunes’ notes from the recently turned over subpoenaed evidence reluctantly turned over by Rosenstein but also includes the much older Presidential Daily Briefings disseminated throughout the Obama Administrations final days. Nunes has reviewed this material but Schiff and Feinstein have not.
The problem is that this stuff is highly classified and releasing it to the public in raw form may well disclose sources and methods hence the concern. That former Deputy Assistant Secretary of Defense Evelyn Farkas had access to it and boasted of her trying to disseminate it to ‘Hill’ people on CNBC shows the Democrat’s ‘national security concerns, as always, are bogus but it does put the Republicans efforts to release it the public in a box.
Sorros predicting 2018 Democratic landslide. Both parties are completely corrupt fascists. Sorros called Trump a dictator. Maybe. Sorros’ only problem with that he isn’t dictating Sorros’ policies.
Soros
The very fact that Soros is badmouthing Trump tells me that Trump is on the right side. If he was part of the multi-headed hydra, all the right people would not hate him so much….
Dear Jesse, Joseph McCarthy was right!!! There was Communist spies throughout the federal government. Please watch the YouTube video “The Truth About McCarthyism: Modern Parallels” by Stefan Molyneux. Your welcome.