Here are the latest news items and commentary on current economics news, market trends, stocks, investing opportunities, and the precious metals markets. We also cover hedges, derivatives, and obscura. Most of these items are from the “tangibles heavy” contrarian perspective of SurvivalBlog’s Founder and Senior Editor, JWR. Today, we look at the corporate debt bubble. (See the Economy & Finance section.)
Precious Metals:
Allen Sykora: Palladium may lose some altitude but expected to remain at lofty heights
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Kitco: Asset allocation tips to prepare for more volatility in 2020
Economy & Finance:
Reader Mark J. was the first of several to send us this, at Zero Hedge: “Massive… Huge… Largest Ever”: Fed Will Flood Market With Gargantuan $500 Billion In Liquidity To Avoid Year-End Repo Crisis
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At Wolf Street: Is the Corporate-Debt Bubble Ripe Yet? An excerpt:
“In its Financial Stability Report, the Fed warns about the ballooning debts of non-financial businesses. These are businesses that are not lenders. Excluding lenders from the tally prevents double counting of debts, since lenders borrow money to lend money. So this is money that non-financial companies owe, and they range from mom-and-pop restaurants to Apple.
The Fed measures this debt in several ways. In absolute dollars, these debts have skyrocketed from record to record and have hit $18 trillion. And as a percent of GDP, these debts have reached historic highs. The Fed says that “the most rapid increases in debt are concentrated among the riskiest firms amid weak credit standards.”
So we’ve got historically high debt levels, especially among the most leveraged companies with negative cash flows, amid loosey-goosey underwriting standards.
And the Fed warns about, laments, and bemoans the speed of this debt pileup, with business debts jumping by 5.1% over the past 12 months, much faster than the economy grew.”
Commodities:
H.L. sent us this: Platts’ Five Major Commodity Themes For 2020
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Nick Cunningham at OilPrice News reports: IEA: An Oil Glut Is Inevitable In 2020
National Debt and Deficit:
Debt Could Reach Record Levels by 2030
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US budget deficit rises to $209 billion in November
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Scooby say: “Ruh-roh!”: Funding Of US Deficits By Monetary Creation Reaches 90% In Late 2019
Forex & Cryptos:
File under: “I Told You So”: Pound Sterling Surges on Election Outcome. A snippet:
“The Pound shot higher against a host of major currencies on the results of the exit poll of the General Election, that showed Boris Johnson’s Conservative party were on course for a landslide unseen since the era of Margaret Thatcher.“
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USD/EUR Forecast, USD/EUR currency rate prediction: Buy or sell USD/EUR pair?
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Ethereum Could Plummet to Lower-$100 Level if Bulls Fail to Hold Key Support Level
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Bitcoin Poised to Collapse Under $5,000? Market Cycle Fractal Suggests So. JWR’s Comment: Take all of this with a grain of salt. I’m not a big believer in the chartists in the equities world, and even less so in the crypto world. Chartist “analysis” in crypto markets is an abstraction of an abstraction.
Tangibles Investing:
Dr. Lori: Predictions & the Antiques Market
Provisos:
SurvivalBlog and its Editors are not paid investment counselors or advisers. 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 closely watch specific markets. If you spot any news that would be of interest to SurvivalBlog readers, then please send it in. News from local news outlets that is missed by the news wire services is especially appreciated. And it need not be only about commodities and precious metals. Thanks!
Re. Kitco’s asset allocation.
They missed two precious metals. Lead and brass should be in everyone’s portfolio.
Regarding all forms of cryptocurrency: I am of the opinion that buying into such creations is a dangerous and unnecessary risk. In the world that we live in today, with the threats that exist to both our infrastructure and electronic world I could not possibly recommend such in good conscience, to anyone. As with any investment, if you do not have access to it and control over it then you do not really have it. It is to me, not an investment with a rather a speculation and today that seems to be a dangerous platform upon which to stand.
But then again, do whatever you want. Personally I choose not to swim with sharks but maybe that’s your thing.
This is best advice that is simply put that I’ve heard in a long while.The jaws of the trap called Normalcy Bias are injuring many of our brethren.
Friends you must believe BGF when he says that if you don’t hold it you don’t own it.
High five, NormlChuck. Our neighbors have been sold a pile of spit when they think gold on paper is really worth anything.
Carry on
Invest in precious metals, Gold,Silver,Brass,Lead and Copper … in as many calibers as you can achieve.
So I’m on the right track then, having a room full (OK, almost full) of Copper, Lead, Brass, and containers full of this powdery stuff, black/grey in color, containing a certain percentages of stuff called glycerin.
You CAN afford silver. Buy an ounce (~$18)- every pay period. Buy as much as you can spare the money for. Buy FOOD. Store some water. You can save yourself and your family. A few years ago, I lost my job when the factory I worked for suddenly moved to China. I went to the food bank once, but realized that this was not sustainable. I sold my lawn mower and whatever else I could. I did not go back to the food bank again. When I got back on my feet, and it took a while, I started buying a few extra cans of food every time I went to the grocery store. I bought a 25 pound bag of rice. Now I have enough canned food and rice (800 lbs.)- a 25# of rice is $10 to $15 ! – to get us by for a long time. I am not rich. In fact, my annual income is still very low compared to most people. But “I will never be hungry again !”…to quote Scarlet O’Hara. You can do it too.
Rice,white,long grain-$10-$15? You need to shop better #20 regularly on sale $7-$8.
Debt…Like most of you, I have little trust in the Fed, but when it says this: “And the Fed warns about, laments, and bemoans the speed of this debt pileup, with business debts jumping by 5.1% over the past 12 months, much faster than the economy grew.” That’s when I start paying attention.
We are in for a rough ride, buckeroos.
Carry on
I have been a stanch believer in precious metals since the 70s and yes I think we should all hold some BUT if you cannot feed yourself and your family then the precious metals will be to no avail.
You live without water for 3 days, you can live without food for a month or so. You must have a way to sustain yourselves over the long haul. Precious metals will be valuable in post SHTF. Until then you have to survive.
I look at food storage kind of like a handgun, it will get you to your long gun (self sufficiency).