– Irish banks vulnerable in stress tests: AIB/ BofI amongst worst 5 banks in EU
– Ulster Bank’s parent Royal Bank of Scotland emerged as 2nd worst bank
– AIB, Banca MPS especially vulnerable & ‘failed’ in adverse scenario (see table)
– Impairment of financial assets was the largest negative contributor to results
– Bad loans continue to pose risks to Irish financial system
– Diversification of deposits & allocation to gold prudent for individuals & companies
– Experts advise diversifying into gold – Eddie Hobbs, Jill Kerby, Dr Gurdgiev, Dr Lucey, Jim Power, Cormac Lucy etc
Irish banks AIB and Bank of Ireland, are some of the most vulnerable banks in Europe according to the European Banking Authority stress test of capital strength, which examined 51 institutions across 15 countries and was released last week. Italy’s Monte dei Paschi (MPS) and the UK’s Royal Bank of Scotland, which owns Ulster Bank, emerged as the biggest losers in the stress tests.
The country’s two main lenders, Allied Irish Banks (ALBK.I) and Bank of Ireland (BKIR.I), saw sharp falls in their share prices and they were placed second and fourth worst respectively among the 51 banks scrutinised over their ability to withstand a three-year economic shock.
An economic shock which seems increasingly likely after the Brexit vote, the increasing risks posed by the insolvent Italian, Portuguese and Greek banking system and the risk of systemic contagion should a large country or indeed bank go bankrupt.
S&P Global Ratings said last week about a fifth of Irish loans are still not being fully repaid and Irish banks now have to contend with the economic fallout from the U.K.’s decision to exit the European Union. As Bloomberg report today:
“Concern has been amplified by Brexit. In the wake of the June 23 vote, S&P cut its forecast for Irish economic growth next year to 3.2 percent from 3.8 percent, and warned that loan losses could rise should Britain’s departure from the EU have a greater impact. The U.K. is Ireland’s biggest trading partner after the U.S.”
Experts continue to urge diversification and owning gold as a way to protect against deposit confiscation and bail-ins in the event that Irish banks get into difficulty again.
Eddie Hobbs recently warned that central bankers are again causing financial bubbles and warned that the “vast expansion of central-bank money-printing operations is having a diminishing effect on economies and that chickens are coming home to roost.” Hobbs concluded his piece in the Examiner saying that
“If you haven’t yet bought some gold, you’d be well advised to do so…”
Gold bullion will continue to protect those who own it as part of an overall diversification strategy and as crucial financial insurance in investment and savings portfolios. Diversification of investments is accepted as common sense. Today, it is prudent to diversify deposits and not have all your cash in one bank or indeed in one country’s banking system.
Today Dr Constantin Gurdgiev, Dr Brian Lucey, Eddie Hobbs, Jim Power, Cormac Lucy, Jill Kerby and others are all advocating diversification into gold again.
Prudent individuals are preparing again sensing we are on the verge of the next stage of the global financial crisis. Indeed, we are seeing more inquiries and demand from companies diversifying into gold then ever before. They are concerned about their deposits and the risks posed by negative interest rates, currency devaluations and deposit bail-ins.
“The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails …”
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Gold and Silver Bullion – News and Commentary
China’s gold reserves rose to $78.89 billion at the end of July (Reuters)
China Bought Less Bullion as Prices Climbed After Brexit Vote (Bloomberg)
Gold holds losses as U.S. jobs data boosts rate-hike expectations (Reuters)
Gold ‘Big Casualty’ After U.S. Jobs Data; Drops to One-Week Low (Bloomberg)
Turkey to increase gold-storage capacity to become regional hub (Dailysabah.com)
Gold price rise correlates with failed central bank policy – World Gold Council (ProactiveInvestors.com)
World Gone Backwards – Mauldin (MaudlinEconomics)
Precious Metals Smashed “Under Cover of Jobs Report”? (Goldseek)
Bail-in for users of hacked bitcoin exchange costs them 36% (Bloomberg)
What’s the real unemployment rate? (CNBC)
Gold Prices (LBMA AM)
08Aug: USD 1,330.00, GBP 1,019.84 & EUR 1,198.86 per ounce
05Aug: USD 1,362.60, GBP 1,036.39 & EUR 1,222.53 per ounce
04Aug: USD 1,351.15, GBP 1,016.61 & EUR 1,213.87 per ounce
03Aug: USD 1,364.40, GBP 1,023.16 & EUR 1,218.96 per ounce
02Aug: USD 1,358.15, GBP 1,025.13 & EUR 1,213.10 per ounce
01Aug: USD 1,348.85, GBP 1,022.97 & EUR 1,207.76 per ounce
29Jul: USD 1,332.50, GBP 1,012.03 & EUR 1,200.18 per ounce
Silver Prices (LBMA)
08Aug: USD 19.66, GBP 15.04 & EUR 17.74 per ounce
05Aug: USD 20.22, GBP 15.36 & EUR 18.14 per ounce
04Aug: USD 20.16, GBP 15.25 & EUR 18.11 per ounce
03Aug: USD 20.59, GBP 15.43 & EUR 18.39 per ounce
02Aug: USD 20.71, GBP 15.65 & EUR 18.51 per ounce
01Aug: USD 20.51, GBP 15.56 & EUR 18.37 per ounce
29Jul: USD 20.04, GBP 15.20 & EUR 18.03 per ounce
Recent Market Updates
– Gold In Sterling 2.2% Higher After Bank Of England Cuts To 0.25% and Expands QE
– Silver Kangaroo Coins – Sales Surge To Over 10 Million
– Trump, Clinton, “Ugliest” Election Coming – Gold’s “Summer Doldrums” Prior To Resumption of Bull Market
– Marc Faber: Invest 25% Of Investment Portfolios In Gold Bullion
– “Could Not Invent A More Bullish Story For Gold Bullion”
– Gold In Bull Market – “Every Reason For It To Continue” – Frisby In Money
– Is Gold Set To Hit $1,500 Per Ounce?
– Why Italy’s bank crisis could be a ‘ticking time bomb’
– Gold Holds Near Two-Week Low as Risk Appetite Rises on U.S. Data
– IMF Scraps Forecast for Global-Growth Pickup on Brexit Fallout
– Gold, Trump and Rates: Bank That Foresaw Rally Flags $1,500
– Gold Lower After Central Bank’s Surprise Move
– “We Are On the Cusp of an Explosion in the Silver Price”
