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 Not QE phenomenon. (See the Economy & Finance section.)
Precious Metals:
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I see that Perpetual Assets has re-launched their business web site, with the phrase: “Americas First Cryptocurrency and Precious Metals Dealer.” They are headquartered in Sheridan, Wyoming.
Economy & Finance:
Federal Reserve Admits It Pumped More than $6 Trillion to Wall Street in Recent Six Week Period. JWR’s Comment: With all this new magically-created “Not QE” money, how long will it be before we start to see substantial inflation at the consumer level? If it continues, “Not QE” is just another bubble–or should I say a bubble within a bubble.
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Over at Lew Rockwell’s site: Doug Casey’s Top 7 Predictions for the 2020s. (Thanks to DSV for the link.)
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At Zero Hedge: Tech Stocks Soar, Bonds Snore, As Oil Suffers Worst Week In Six Months
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The folks at Wolf Street are pointing out economic contraction indicators: Manufacturing Employment, New Orders & Production Fall Fastest Since Apr-Aug 2009
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Rob Langston: 10 investment themes set to dominate the 2020s
Commodities:
H.L. sent us this:
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OilPrice News reports: Bearish Sentiment Returns to Oil Markets
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Lithium Outlook 2020: The Lithium Decade Begins. JWR’s Comment: To quote one of the best movies ever made: “Lithium in no longer available on credit.”
Forex & Cryptos:
Safe-haven currencies retreat as U.S., Iran seen defusing crisis
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Zero Hedge noted that Bitcoin surged to nearly $8,500 USD immediately after the death of Iranian General Soleimani, but then settled down to around $8,000 USD.
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Bitcoin Price Will Be Golden in 2020 Thanks to Limited Supply, Increasing Use: Bloomberg Report
Tangibles Investing:
Jim Wang: Think The Stock Market Is Expensive? Here Are 14 ‘Alternative’ Investment Ideas
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Antiques and Collectibles: What to Consider Before Investing, Buying, or Selling. Here is a brief excerpt:
“As investments, there are a number of unique upsides [to tangibles] you cannot replicate with anything else:
- Tangible assets: Collectibles are not influenced by inflation or interest rate headwinds.
- Low-correlation to the stock market: Collectible markets rarely move in tandem with the economy.
- Growing rarity: It is all supply and demand. Over time, historic collectibles become scarce, as they are lost, damaged, or enter museums and institutions.
- Tax differences: Many items that are collectible are considered as “wasting assets” and do not factor into inheritance or capital gains tax calculations.
- Personal control: You hold on to the assets; you don’t have to worry about a Bernie Madoff figure bilking you out of your money or anything like an investment bank run.”
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!
6 trillion is much worse than expected, but then it is only a number. Soon 60 trillion will only be a number, yet rates will be at zero, and therefore it is ‘free’ money, thus any number has no meaning, other than the fact the system can’t be fixed. At some point, a sum upwards of a quadrillion will simply not keep it functioning, and then it breaks. Who knows when that will be, or what it will look like, but it would be broken beyond repair. No one wants to admit it.
“Please no one tell Obama what comes after a Trillion”.- Sara Palin
Same applies to the ‘Fed’…
This Fed system will break when nobody will buy our debts AKA Treasury Bills. All Empires money systems have failed the same way. A lack of confidence and thus a lack of acceptance = Hyperinflation at home when all those FIAT monies come home to roost. 100 dollar loaves of bread anybody?
The SECURE act passed with Bi-Partisan support in December 2019 has been said to contain provisions for the Government to “Protect Us” from the dangers of the Stock Market by allowing us to buy their debts. A Bail IN for the Fed eh? Trillions setting around in Pensions and 401K’s just wasting away from the viewpoint of the Bankers.
BUT we have to PASS it to READ it….. So they did….
The winner in an economic collapse is the family that can feed, shelter and protect themselves. Bonus if you have like minded friends to work together like the Amish and their Barn Raisings.
But remember that during the Great Depression the Sherriff assisted the Bankers in selling family homes and farms by forcing the previous owners OUT into Homelessness due to debts OR even failure to pay TAXES. Government and Banks have ONE Prime Directive “To SURVIVE” and they will again use law enforcement as their shock troops to get your property.
So HAVE a way to pay those debts and TAXES friends.
So if I understand this right the fed is rebuying bonds, that it originally bought with credit (debt), again on credit (debt)? Isn’t that like me buying a car on a credit card and paying that credit card off it a different credit card? Wow!!
When I try to pay my AmEx bill with my Visa card, it’s stupid; when the government does it, it’s stimulus.
I used that as a sig line back when Obama’s administration was doing the big bailout and talking about “shovel-ready jobs.” He may be gone but the sentiment still holds true.
I’ve been reading The Creature from Jekyll Island by G. Edward Griffin. After reading this, I am convinced that the economy will never crash. They will just inflate it even more.
When the crash arrives the only tangible assets that will help you survive and possibly
preserve your wealth are gold and silver.
The new monetary system will be based on precious metals.In normal times fancy cars,watches,art work,and old guns are fun to fool around with.
These are not normal times.
NormalChuck- you are correct. But remember that not only will PMs go up exponentially, ALL tangible necessities like food and land will also rise, though maybe not as much as precious metals. In other words, have your bullets, bandages, shelter, and beans as well as your gold and/or silver. Start with food and shelter first. IMHO
Gold and Silver, right after plenty of Beans, Bullets and Bandaids … get ready to be a Smurf, err Serf! 🙂
Tunnel Rabbit is right. No one wants to admit the very real problems at hand. Policy makers will continue to manipulate their ways around these, and avoid the reckoning until that reckoning is upon us. There are and will continue to be clues, some more obvious than others.
There is something not right with the calculation of 6 trillion extended to the market via repo operations. The most recent fed balance sheet (available on their website) shows just over 4 trillion in total liabilities, similar amount in their total assets , making the 6 trillion supposed recent injection via repurchase of securities impossible. Jan 10 Wall Street Journal article suggests the total repo amount is more similar to a few hundred billion –
This is a BS story. Scan down through all the headlines on Wallstreetparade.com and they are all negative, exaggerated claims. It is difficult to know what facts prompted this particular story but it appears to simply be the reissuing of existing debt not an additional $6 trillion as they claim.
I wonder about that too.
Maybe since it is the repo market and the overnight loans are typically paid off the next day, this is how much has been recycled if you will.
Like you loan $100 overnight for 30 successive nights. Every morning it is paid back. You have loaned $3000 but your balance sheet has not changed $3000.
Do you think that is what they might be saying?
I also wonder if you looked deep into this if this money is being used somehow in high frequency trading each night. I don’t know which markets this might be happening in but it sure sounds like a possibility. The book “Flash Boys” talks about front running in the HFT world. If you could use ultra cheap Fed money to front run a market or markets all night, you could probably make a killing at a penny or two a share with virtually no risk because your algorithms would hold positions for just microseconds or maybe by now nanoseconds.
Just speculating.
I think you may have it right. I couldn’t understand exactly what they got wrong, it seemed they were implying that 6 trillion had been added to the money supply. That’s just not correct, based on reading the FED balance sheet. If you add up all of the roundtrips counting only One direction you might get to 6 trillion. i’m not sure what the long-term implications are. There’s a lot of funny money, but I think adding up both sides of the roundtrips is more accurate
It’s really important to understand the truth about these things, because it does influence long-term investing decisions. I believe Solomon had it right: add your portion to seven or eight, because you do not know what misfortune may come upon the land. His emphasis was that we really cannot know. We can make guesses, that’s about as far as I can go. In the last 10 or 15 years, I’ve been incorrect several times. Thankfully I don’t completely believe myself so I stay diversified. Which ever pot makes money, I sell some and move it to the one that lost. In the end, I have a good chunk of change in each pot.
I don’t have investing figured out either but same as you with saving and hedging I am doing ok. Not spectacular but ok.
Great picture! Very appropriate.
An honest and forthcoming accounting would be extraordinary, although it’s unlikely that this will happen via most media. With this in mind, be not fooled… The conditions we face are difficult (at best) to overcome. This is true not only because of financial mechanics, but also because of the unwillingness of people to face the hardest of the facts, and then to make the adjustments necessary to course correct.
I find it amazing that starting your own business, as an investment alternative to the stock market, is last behind 13 options that rely on a greater fool to pay more than you paid for it.