To Determine the Gold Price Path in 2016, Watch This Macro Indicator

This is a syndicated repost courtesy of Money Morning – We Make Investing Profitable. To view original, click here. Reposted with permission.
Anyone who’s been watching the gold price can’t complain for lack of excitement.
This week, we have mostly the Fed to thank for that. From not raising rates at the latest meeting to their indication of a slowing pace of rate hikes this year and the effects on the U. S. dollar, it’s all been great for gold prices.
There are an increasing number of eyeballs focusing on the gold price, and that may be somewhat negative in the near term…
But if there’s one macro indicator that helps determine the future path ofgold prices, it’s the one I’m going to talk about with you today.

This post was published at Wall Street Examiner by Peter Krauth ‘ March 18, 2016.

Subprime Auto Delinquencies Soar Past Crisis Levels, Now Highest In 20 Years

On Thursday night, we brought you a first-hand account of what’s really going on in subprime auto.
According to a reader who works in the industry, the securitization machine may be grinding to a halt for deals that are stuffed with loans to borrowers with low (or no) FICOs. Here’s an excerpt:
‘I work for a smaller but fast growing auto finance company [and] we grew from opening the doors in 2013 to having a $250 million portfolio as of today. Things for the last 3 years have been booming and it seemed like there would be no end to our growth. We were rated by S&P in January and were ready to start securitizing our portfolio. On March 1st I came into the office to find out that they had started layoffs. These people were fairly new and were in departments that the executive staff has now deemed unnecessary.
I had a meeting with my boss who told me my job is safe but due to us not being able to securitize we were freezing hiring going forward but we were hopefully done with layoffs.’

This post was published at Zero Hedge on 03/18/2016 –.

To Oppose Free Trade Is To Embrace Violence

Supporting free trade is simply a matter of taking no action when another person exchanges in non-violent exchange with another person. That person may be right down the street, or that person may be in another country somewhere. No ‘free trade agreements’ or other paperwork of any kind is required.
To oppose free trade, on the other hand, is to engage in the imposition of fines, prison terms, and other sanctions on people for engaging in non-violent exchange.
The Moral Argument That latter part is usually ignored by average people who support restrictions on free trade for whatever reason. They frame their opposition to trade as if it were a mere academic question, and as if the reality of restricting free trade were simply a matter of saying ‘don’t do that’ and then everyone will agree to stop doing it.
But, of course, anyone who favors restrictions on free trade needs to go the next step and outline exactly what fines and jail sentences should be imposed on merchants and others who have committed the ‘crime’ of purchasing goods from non-government-approved sources, or who have sold goods to non-government-approved recipients.

This post was published at Ludwig von Mises Institute on MARCH 18, 2016.

Proof It Is Rigged: ‘Fed Moved 93% of Entire Stock Market Since 2008’

Fact: The Federal Reserve has screwed over the country.
Monetary policy has been the single most important factor in the economy for some time.
A new analysis from economist Brian Barnier shows that while future GDP, household debt from credit cards and tech accounted for past bubbles in American history, the bubble that has risen since Obama became president is due to one – and only one – factor: the Federal Reserve.
And the private banking cartel – which masquerades as a public government institution – has become plenty controversial for its ties to elite hidden agendas and its debasement of the economy.
However, few Americans realize just how huge – and detrimental – this institution has become.
In the wake of the 2008 financial crisis, the Fed, then chaired by Ben Bernanke, began an unprecedented quantitative easing (QE) program that literally changed everything.

This post was published at shtfplan on March 18th, 2016.

Weekend Reading: Did The Fed Just Cage The Bear?

Submitted by Lance Roberts via,
The past two week’s have been full of Central Bank interventions starting with the ECB last week and culminating with a more accommodative Fed and BOJ interventions this week.
As stated earlier this week:
‘The Fed currently finds itself in a tough spot from a ‘data dependent’ standpoint. Last December, when the Fed Funds rate was increased, the Fed discussed the potential for further rate hikes in 2016 as inflation and employment data strengthened. With that data improving, along with the strong rebound in the financial markets, the Fed runs the risk of losing credibility if they DO NOT hike rates again on Wednesday OR give a very strong indication they will do so at the next meeting.’ I was wrong. The Fed jumped into the boat with the ECB this week by not only ignoring the recent spate of stronger employment and inflationary pressures, but by lowering economic forecasts and reducing the number of rate hikes this year from 4 to 2. This was, in effect, ‘Yellen’s Bazooka.’ Given the more’accommodative posture,’ it is not surprising the financial markets decide to jump into the boat with her.

This post was published at Zero Hedge on 03/18/2016 –.

Oil Prices Rally to 2016 Highs on Weaker Dollar

Two hundred and three years after David Melville patented the gas streetlight, and oil prices are lit up once again today. Prices are rallying for a third consecutive day, and for a fifth consecutive week – the longest streak since last May. WTI has now leapt into forty-dollardom to boot, with an impending prompt month rollover to a higher level on Tuesday (contract expiry on Monday). Henceforth, here are six things to consider today:
1) There has been little in the way of economic data overnight to influence markets, with the Uni of Michigan sentiment data the main release of note in the US today – all measures came in below expectations. We have several Federal Reserve FOMC speakers on deck – Dudley, Rosengren and Bullard – who all could all provide further insights into Fed policy going forward. This could filter through to our dearly beloved commodities via US dollar oscillations.
Read Leading Indicators Show US, Global Economy at a Tipping Point
2) The inverse relationship betwixt the US dollar and crude cannot be understated. As we discussed yesterday, the rebound in risk appetite means crude is charging to multi-month highs as the US dollar charges to multi-month lows. As ongoing loose monetary policy and stimulus measures are undertaken around the world, deterioration in the financial state of the US shale industry is likely being postponed by the respite of an oil price rally:

This post was published at FinancialSense on 03/18/2016.

Why the Chinese Economy Is Not Out of the Woods

This is a syndicated repost courtesy of Money Morning – We Make Investing Profitable. To view original, click here. Reposted with permission.
The new year started with sharp declines in the Chinesestock market that spooked investors around the world. But in recent weeks, conditions appear to have stabilized. Lending in China rose in January by 67%, iron ore prices rallied by 64%, and housing sales in China’s top four markets also surged. The yuan also regained about half of the 7% it had lost against the U. S. dollar since November.
But the news is not all good.
About $800 billion of debt was added to the Chinese economy in January, but it failed to boost production or increase sales. Producer prices dropped by 5.1% in January-February, while the manufacturing PMI fell to 48 in February from 48.4 in January, signaling further economic slowing. The market is apparently not convinced that the government can keep inflating an already overleveraged economy.
And one very telltale instance of the ‘rats leaving the sinking ship’ shows you the true story…

This post was published at Wall Street Examiner by Michael E. Lewitt ‘ March 18, 2016.

Gold Daily and Silver Weekly Charts – Shenanigans for Option Expiration, Silver Cup and Handle

“Let us take things as we find them: let us not attempt to distort them into what they are not. True philosophy deals with facts. We cannot make facts. All our wishing cannot change them. We must use them…
Let us attempt to understand it. Let us not disguise it, or explain it away. It may have difficulties; if so, let us own them. Let us fairly meet them: if we can, let us overcome them.”
John Henry Newman
On the bright side, option expiration antics aside, silver has set a proper handle, but has yet to ‘activate’ it by taking out 16 with some authority, and refusing to give it up.
Granted it is a little harder to see on the weekly chart that I use, but it is clearly there. Now, follow through and a move higher is everything. If it can succeed, we are probably looking at a run towards a twenty handle.
There was little activity at The Bucket Shop for deliveries, and the warehouses were their usual quiet selves except for silver, which again is spurred on by CNT and their wholesale business.

This post was published at Jesses Crossroads Cafe on 18 MARCH 2016.

Another financial institution joins the rebellion, stockpiles cash and gold

Last year, amid all the madness in financial markets, financial historian and strategist Russell Napier joked about creating a ‘European high-yield capital guarantee fund.’
His ‘high-yield’ fund was nothing more than a secure room filled with physical cash, and a guy standing outside with a gun to guard it.
As jokes tend to be, this was a sad reflection on reality.
Though physical cash bears no interest, it is considered ‘high yield’ compared to bank balances and government bonds that carry negative rates.
Napier’s joke is now coming true.
Earlier this week, the CEO of Munich Re, the largest reinsurance company in the world, announced that they would start holding 8-digit sums of physical cash and gold in their vaults.

This post was published at Sovereign Man on March 18, 2016.

The Federal Reserve is Being Held Hostage by China

Please not the following from the Federal Reserve’s FOMC statement:
Information received since the Federal Open Market Committee met in January suggests that economic activity has been expanding at a moderate pace despite the global economic and financial developments of recent months. Household spending has been increasing at a moderate rate, and the housing sector has improved further; however, business fixed investment and net exports have been soft. A range of recent indicators, including strong job gains, points to additional strengthening of the labor market. Inflation picked up in recent months; however, it continued to run below the Committee’s 2 percent longer-run objective, partly reflecting declines in energy prices and in prices of non-energy imports. Market-based measures of inflation compensation remain low; survey-based measures of longer-term inflation expectations are little changed, on balance, in recent months.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee currently expects that, with gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace and labor market indicators will continue to strengthen. However, global economic and financial developments continue to pose risks. Inflation is expected to remain low in the near term, in part because of earlier declines in energy prices, but to rise to 2 percent over the medium term as the transitory effects of declines in energy and import prices dissipate and the labor market strengthens further. The Committee continues to monitor inflation developments closely.

This post was published at John Galt Fla on March 17, 2015.

WSJ Fires Back At Trump: “He Would Rather Walk Down Fifth Avenue And Shoot The Messenger”

In addition to the usual suspects (WaPo, HuffPo) over the past few days a new media nemesis has emerged for Trump: the Rupert Murdoch-owned Wall Street Journal.
On Thursday, Trump posted several of tweets in response to a Journal editorial that criticized him for refusing to participate in a debate next week, for being unwilling to consult foreign policy experts and other issues. This is what he said:
@WSJ Editorial says “Clinton primary vote total is 8,646,551. Trump’s is 7,533,692”-a knock. But she had only 3 opponents-I had 16. Apologize @WSJ is bad at math. The good news is, nobody cares what they say in their editorials anymore, especially me! Please explain to the dummies at the @WSJ Editorial Board that I love to debate and have won, according to Drudge etc., all 11 of them! Overnight, the WSJ has fired back with the following “Trump Reality Check“

This post was published at Zero Hedge on 03/18/2016 –.

Trump Video From 25 Years Ago Will Shock You: ‘I’m Tired of Seeing This Country Ripped Off’

The Donald has completely taken over the news cycle.
His path of victory after victory in GOP primary states has the establishment freaking out, and every major media outlet scrambling for a way to stop Trump, or at least to damage his reputation.
But why is he being compared to Hitler and inducing aneurysms among the political elite?
Obviously it isn’t the name-calling or fiery rhetoric that has the system’s minions losing sleep and openly-plotting his demise.
No. It is for one basic reason: his rhetoric and campaign promises have centered around restoring American sovereignty.
Economically, he has talked about undoing globalism and free trade, bringing back good American jobs, protecting the border (and yes, building the 10 foot high wall) and saying no to a culture of exploiting illegal immigrant workers at the expense of American employment.

This post was published at shtfplan on March 18th, 2016.

Let Us Remember…..

Ted Cruz likes to boast that he can “beat Hillary.”
He will lose to Hillary in Florida, and I remind you that only electoral votes count in the general election.
Trump, on the other hand, will tattoo Hillary in Florida. He will also beat her in North Carolina and will beat her in Ohio.
You can’t lose any of those states in the general election and be President.
Of those states Cruz might beat Hillary in North Carolina and will probably do so in Missouri. But he will lose Florida with certainty and he might lose Ohio.
If he loses either in the general Hillary is President.
That’s the math folks.

This post was published at Market-Ticker on 2016-03-18.

Whatever Happened to the Invisible Hand of Capitalism?

It has been an interesting week for Fed observers and markets. There is an odd disconnect between the data that we are told the Fed depends on and the press release and follow-on press conference that the FOMC conducts after its meetings. But clearly the market likes it that way. This week’s Outside the Box deals with the philosophical issue of the Federal Reserve setting the price of money. My friend and well-known value investor Vitaliy Katsenelson goes back to his youth in Russia, where some bureaucrat arbitrarily set the price of sugar, and likens that to the Fed setting the price of money – or interest rates. We all intuitively understand that a bureaucrat setting the price of sugar is a dumb idea. Yet the market seemingly loves having the Fed set the price of money.
But before we jump into Vitaliy’s short but very thoughtful essay, I think the perfect set-up in is a note I got from my friend Peter Boockvar, who writes for The Lindsay Group. Every time I get in the room with Peter I come away with several nuggets to meditate on. Let’s just jump into his remarks without a lot of comment:
For the past few years the Fed has been chipping away at the concept that they are driving monetary policy dependent on the data that they see. We know that because they kept changing the rules of the game in that every time a goal was reached the goal was altered. Well, I believe it is safe to say that after yesterday’s FOMC statement, the Yellen press conference and what was said in them, the communication and structural strategy of ‘data dependency’ has been officially neutered. The Fed’s goal is now a perfect world. As we of course will never get there, the rest of us are left flying blind as to what to expect from monetary policy.

This post was published at Mauldin Economics on MARCH 18, 2016.

IMF’s Lagarde Says Negative Rates Have Helped Global Economy (What Is The Experiment?)

his is a syndicated repost courtesy of Confounded Interest. To view original, click here. Reposted with permission.
Bloomberg – The world economy would be worse off without negative interest rates, according to International Monetary Fund Managing Director Christine Lagarde.
Negative rates in Europe and Japan have helped support global growth and price gains, she said in an interview in Ho Chi Minh City on Friday. The finance sector may need to implement new business models as a result, she said.
‘If we had not had those negative rates, we would be in a much worse place today, with inflation probably lower than where it is, with growth probably lower than where we have it,’ Lagarde said. ‘It was a good thing to actually implement those negative rates under the current circumstances.’

This post was published at Wall Street Examiner by Anthony B. Sanders ‘ March 18, 2016.