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 China’s unsustainable debt bubble. (See the Economy & Finance section.)
Precious Metals:
Needless to say, look for a big breakout in the prices of gold, silver, and platinum if Russia fully invades Ukraine. Stack them deep, and stack them early. Commerzbank seems to agree.
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Neither Inflation Nor The Fed Moves Gold.
Economy & Finance:
Mainland China’s debt bubble implosion now seems to be getting fully underway. The collapse of Evergrande and other over-leveraged construction companies is in full swing. This implosion will very likely expand to many other sectors of the Chinese economy. The next sectors to fail? Most likely it will be high-speed rail lines, then car makers, and then perhaps their high technology sector. The debt-to-GDP ratio in China is seriously out of whack — somewhere around 270%. And the size of China’s bond market is second only to that in the United States. A lot of the Chinese debt was for Pie in the Sky boondoggles. This level of malinvestment needs to be “un-wound” before their economy can resume any real progress.
In the 19th Century and early 20th Century, China had a problem with the global opium trade. But now, in the early 21st Century, they have a problem with the global OPM market. What is OPM? Other People’s Money (OPM). Debt. There is simply too much debt. China has created a wholly unsustainable debt bubble. Many of the underlying “assets” of these loans are not sellable. They are ghost apartment complexes and entire ghost cities. Many of these buildings are just empty shells of apartment blocks and offices that were never completed. The Chinese Communist Party (CCP) is fully complicit with creating the debt bubble.
Again, what happened to Evergrande and Kaisa was just the beginning– just a precursor of a monumental debt crisis that could very quickly become globally contagious. Beware.
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Markets Are “Sea Of Red” Amid “Total Meltdown In Anything Tech And Pandemic Winners”.
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Treasury Yields Spike After Jamie Dimon Forecasts “Six Or Seven” Rate Hikes In 2022.
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Goldman Plunges After Trading Revenue Miss.
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Visualizing The $94 Trillion World Economy In One Chart.
Commodities:
H.L. sent us this: Orange crop is set to be the smallest since WWII, sending OJ prices surging.
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OilPrice News reports: In Rare Move, China Discloses Oil Imports From Iran.
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Oil Soars To 7 Year High As Goldman Sees Brent Hitting $105 In 2023.
Forex & Cryptos:
Peru: The Central Bank will launch a CBDC.
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Rout of Risky Assets Continues.
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Bank Of Russia Calls For Ban On Crypto Mining And Trading.
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Bitcoin Breaks $37,000, Why Downtrend To $29,000 Is Likely.
Tangibles Investing:
A Glock of a Different Color. I’ve mentioned this gun investing angle in SurvivalBlog once before, but I thought that I should expand on it a bit: Finding low-population factory-finished pistols in unusual colors and then vault-stacking them in new-in-box (NIB) or like-new-in-box (LNIB) condition, as investments. Shown is one with a factory green frame. Be advised that most black Glock models are mass-produced and essentially just commodities, and therefore they generally only match the rate of currency inflation. It is only a few odd Glock variants that have been made in small numbers that qualify as true investment guns. And of those, it is only ones that are either NIB or LNIB that will be sought-after, by collectors.
Before buying a colorful Glock, take note the difference between factory finishes and aftermarket finishes. The former will gain in value, while the latter will not. Also note that any Gen 5 Glock pistols can still be cranked out in color in large numbers, if there is sufficient market demand. But there will be no more Gen 3 Glocks — so odd variant NIB Gen 3 models are where you should probably start looking.
A few of the special finishes were factory-made, but only distributed through just one distributor, such as Lipsey’s. The latest finish that I’ve seen is this: The new Glock G43X 9mm compact pistol, in “Rose Gold” color. (At the Palmetto State Armory site, search on “PX4350204”.) I’m not certain if that is a factory finish, or aftermarket.
Of course, a handsome-color pistol won’t make you shoot any better, but someday your grandkids may thank you for your investing acumen.
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Rolex, Patek, Audemars Piguet; Kevin O’Leary’s ‘great investment’ watch picks.
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Real estate expert warns of commercial ‘bloodbath’.
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 or 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 items from local news outlets that are missed by the news wire services are especially appreciated. And it need not be only about commodities and precious metals. Thanks!