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 boom in British classic car prices. (See the Tangibles Investing section.)
Precious Metals:
CPM Group: Silver Shines.
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The latest from Arkadiusz Sieroń: Bond Conundrum – Boom or Bust for Gold? A pericope:
“But now we can observe rising inflation and declining bond yields at the same time. The yield on the 10-year Treasury is 1.3%, which is 4 percentage points below the inflation rate, so investors who buy bonds lose a lot of money in real terms. Something is clearly wrong here. Let’s solve this bond conundrum!
The first potential explanation is that bond investors trust the Fed and believe that high inflation is mainly transitory. If so, the bond yields are more or less accurate and could stay around current low levels, and the inflation rates will adjust. The supply disruptions caused by the pandemic will eventually resolve, while the Fed is going to tighten its monetary policy, adding to disinflationary forces.
At first glance, the scenario in which inflation is declining seems to be negative for the yellow metal, as it implies lower demand for gold as an inflation hedge. However, in this case, interest rates could stay at very low levels for a long time. And gold likes the environment of low yields.
The second possible reason for the decline in interest rates is that bond investors expect slower economic growth than previously thought.”
Economy & Finance:
Biden’s Economy: The Black-White Unemployment Gap Soared in August.
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Desperate Money Printing Leads to Depression – Dr. Marc Faber.
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By 2022 only these 12 states will tax Social Security benefits.
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At Mises Wire: This Is a Sign that Price Inflation Will Soon Get Worse.