GSB Weekly Review: FED Hikes, Dollar Climbs, Gold Slides

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Published : June 16th, 2017
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Category : Gold and Silver

Gold and Silver Commentary:

Gold bottomed in December of 2015 and again in December 2016, but gold prices have risen for the past six months.  The 50 day moving average (gold, but not yet silver) has crossed above the 200 day moving average – a so-called “golden cross.”  Expect higher prices for both gold and silver.

Gold should move higher for several years given the increasingly dangerous global economic conditions, low interest rates and continual fiat currency devaluations.  A major stock market correction and/or crash, similar to or worse than 2008, is likely by the end of 2017.  I expect the Fed will “inflate or die” attempting to preserve the stock near-bubble.  Their efforts will fail to support an over-valued stock market as they failed in 2000-2002 and 2007-2009.  However the Fed actions will drive gold and silver prices much higher.

The excessive debt, continued dollar devaluation, and added currency in circulation will encourage investors to move into gold and silver investments (insurance) to preserve their savings and purchasing power.  Panic, fear, political turmoil, a banking crisis and war are also probable.

Gold and Silver Markets:

The Big News:

The Fed Raised Rates by 0.25% on June 14, 2017.  From Reuters:

“The Federal Reserve raised interest rates on Wednesday for the second time in three months, citing continued U.S. economic growth and job market strength, and announced it would begin cutting its holdings of bonds and other securities this year.”

The article continued, but my summary is “yada, yada, yada…”

MY COMMENT:  The Fed sees economic growth but real people see thousands of retail stores closing, half-empty shopping malls, unpayable student debt, delinquent auto loans, failing pension plans, and near zero earnings on their savings.

MY COMMENT:  The Fed sees continued job market strength but real people see unemployment, “food stamps,” disability applications, layoffs, minimum wage jobs, and working two or three jobs to pay for basic living.

CRITICAL READS – Gold and Silver:

Maison Placements Canada Inc:  “Gold:  Whoever Has the Gold, Makes the Rules”

“In sum, gold will continue to rise as long as the US budget remains in deficit, the US trade account is in deficit and Donald Trump is in the White House.  Trust in Trump has disappeared both at home and now abroad.  Ironically, Mr. Trump will be very reliable as an agent of dollar devaluation, which is good for gold.”

Read more here.

MY COMMENT:  Gold will continue to rise regardless of whom is President.  Gold will rise as long as the Fed creates fiat currency, devalues the dollar and debt increases.

Clive Maund:  “The Sun Rises on the Precious Metal Sector”

“On the 8-year chart for gold it is now becoming apparent that a large Head-and-Shoulder bottom is completing, that started to form way back in 2013, so this is a big base pattern that should lead to a major bullmarket, and given what is set to go down in the debt and derivatives markets, it should easily exceed earlier highs.”

Read more here.

CRITICAL READS – Economy, Stocks, Bonds, Bubbles:

Brandon Smith:  “Peak Economic Delusion Signals Coming Crisis”

“These are only a few of the MANY data points that paint a very ugly picture for the US economy.  The rest of the world is just as tenuous if not worse.”

“The data points above show an economy that is in severe deterioration, not recovery.  Stock markets are next …”

Read more here.

Zerohedge:  “93% of All Jobs ‘Created’ Since 2008 Were Added Through the Birth/Death Model.”

“… a full 93% of the new jobs reported since 2008 – 6.3 million out of 6.7 million – and 40% of the jobs in 2016 alone were added through the business birth and death model – a highly controversial model which is not supported by the data.”

Read more here.

Gold Stock Bull:  “Gold, The Dow, Bubbles And The Coming Correction”

“Easy money and massive debts – thanks to the Federal Reserve and fractional reserve banking – have created over-valuations and bubble like prices in stocks, bonds, and real estate. Gold and silver prices have suffered. Expect reversals!”

Read more here.

David Haggith:  “Summer Storm … Great Recession Approaches”

Household debt at new peak, construction spending drops, financial stocks have collapsed, pending home sales are down, auto inventory highest since 2007, Illinois debt downgraded, retail apocalypse grows…

“Fundamentals are falling out RAPIDLY from under the stock market, but the robotraders [HFT] keep trying to do their relentless programmed job of ratcheting the market up …”

Read more here.

Wolf Street:  “Bail-In Era for Europe’s Banking Crisis Begins”

“Banco Popular, until today Spain’s sixth biggest bank, is no more.”

Read more here.

Hard Assets Alliance:  “North Korea:  Is War the Inevitable Outcome?”

Reference: Howe and Strauss’s theory of historical cycles:

“The Fourth Turning is a Crisis.  This period, which is marked by social unrest, political turmoil, and the destruction of traditional institutions, typically included a major war.  Previous Crisis turnings involved WWII, the Civil War, and the American War of Independence.

According to Howe we are in the middle of the Fourth Turning right now.”

Read more here.

Zerohedge:  “U.S. Weeks Away From a Recession According to Latest Loan Data”

“… since 1960, every time Commercial & Industrial loan balances have declined (or simply stopped growing), whether due to tighter loan supply or declining demand, a recession was already either in progress or would start soon.”

Read more here.

POLITICAL COMMENTARY:

Repeat:  Whoever Has the Gold, Makes the Rules!

Gold is moving to China, Russia and India and away from London and New York.  Consider the implications!

The Fort Knox Bullion Depository has not been audited since the 1950s.  How close to empty is the Depository? 

Gold, Fed Notes, National Debt, Counterfeiting, and Zimbabwe:

THEATRE OF THE ABSURD:

We will tax ourselves into prosperity,” said no politician running for office.  But taxes continue to increase…

“We will print trillions of dollars and feed it to our banker friends.  Screw the savers and the middle class,” said no central banker to the public.  But their actions tell another story…

Gold has been money and a store of value for thousands of years.  The U.S. dollar has lost roughly 98% of its purchasing power in a century.  Most U.S. stocks and bonds are over-valued and due to correct.

The choices for your savings and preservation of purchasing power should be easy.  Most stocks and bonds … versus … physical gold, physical silver, gold stocks, and silver stocks.  Get all of our research, stock picks, model portfolio and trade alerts by subscribing to Gold Stock Bull.

Gold Stock Bull

Gary Christenson

The Deviant Investor

Data and Statistics for these countries : Canada | China | Georgia | India | Russia | Spain | Zimbabwe | All
Gold and Silver Prices for these countries : Canada | China | Georgia | India | Russia | Spain | Zimbabwe | All
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Jason Hamlin is the founder of Gold Stock Bull, a site providing investment strategies for profiting on the bull markets in Gold, Silver and Alternative Energy. Jason has a background in market research with ACNielsen, and has developed an expertise at analyzing data, charts and market trends for several Fortune 500 companies around the world. Jason has an in-depth knowledge of investing, has passed the Series 65 Uniform Investment Adviser Law Examination and has been tracking the secular bull market in precious metals since its inception.
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