Economics & Investing For Preppers

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Here are the latest items and commentary on current economics news, market trends, stocks, investing opportunities, and the precious metals markets. We also cover hedges, derivatives, and obscura. And it bears mention that most of these items are from the “tangibles heavy” contrarian perspective of JWR. (SurvivalBlog’s Founder and Senior Editor.) Today’s focus is on the U.S. public and private debt.  (See the Troubling Trends section.)

Precious Metals

First off, here is a headline from Monday: Surging US Dollar Sinks Gold And Silver Prices

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Gold Could Face ‘Further Punishment’ – FXTM.  JWR Says: “Buy on the dips.”

Stocks:

Morningstar reported on Tuesday: “Political troubles in Spain, after the weekend saw violent clashes over the Catalonia referendum, took a dent out of the main Ibex index, which was down over 1% at 10.527.”

Commodities:

The price of crude oil seems to have stabilized around $50 per barrel.  This is bad news for OPEC.  And it is not reassuring to the Bakken shale oil producers. (Since $50 is right around break-even for them.)

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After a year in the doldrums, the price of nickel ore is back up to where it was in October of 2016. Though only half of where it was at the odd 2014 price spike, nickel is still attracting plenty of investors.  Small investors can of course hedge by stockpiling U.S. 5 Cent Pieces–still available at face value.

Forex:

Iraq steps up retaliation against Kurdish independence vote with dollar ban

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National Bank of Canada: Are markets underestimating the Fed?

Derivatives:

Next, at Zero Hedge: Meet The New, “Safe” Synthetic CDO’s That Could Spell Disaster For The European Banking System

Troubling Trends (U.S. public and private debt):

The private debt to GDP ratio is creeping back up to 200%.  (And that is with GDP surging!) Meanwhile, the pubic debt is now north of $20 trillion. That is 103% of GDP. And net interest payments on the debt are estimated to total $276.2 billion this fiscal year, or 6.8% of all federal outlays. That is not sustainable in the long run. So be prepared for continuing debasement of our currency, as Uncle Sugar’s “escape mechanism” for its enormous debt.

Tangibles Investing:

This 2016 article serves as a good primer: Avoid These Five Traps When Buying Real Estate in Self-Directed IRAs

Provisos:

SurvivalBlog and its Editors are not paid investment counselors or advisers. So please see our Provisos page for our detailed disclaimers.

News Tips:

Please send your economics and investing news tips to JWR. (Either via e-mail of via our Contact form.) These are often especially relevant, because they come from folks who particularly watch individual markets. And due to their diligence and focus, we benefit from fresh “on target” investing news. We often “get the scoop” on economic and investing news that is probably ignored (or reported late) by mainstream American news outlets. Thanks!


3 Comments

  1. At $50 a barrel, North Slope oil from Alaska is not at the break even point. Alaska’s economy will continue to tank. The state was paying the oil companies subsidies even when the price was over $100 a barrel. Now that the state has emptied their coffers providing welfare to their residents for the past few years waiting for the price to recover, a lot of folks are going to have a tough winter dealing with a dried up well.

    Meanwhile, if domestic logistics in the lower 48 can recover from the bad weather events, we had a pretty good bumper crop nationally on most commodities. With lower transport costs persisting, I would expect to see a little consumer deflation (financial matters will continue to flounder). I’d look for gold to drop price to perhaps <$1k/oz, assuming the gummit doesn't do something drastic, like drag us into a war or some such.

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