Business

Submitted by Nick Giambruno via InternationalMan.com,

On August 15, 1971, President Nixon killed the last remnants of the gold standard.

It was one of the most significant events in US history—on par with the 1929 stock market crash, JFK’s assassination, or the 9/11 attacks. Yet most people know nothing about it.

Here’s what happened…

After World War 2, the US had the largest gold reserves in the world, by far. Along with winning the war, this let the US reconstruct the global monetary system around the dollar.

Two weeks ago, Goldman analysts were stunned when they noted that in recent weeks gasoline demand in the US has collapsed to levels that suggest not all is well with the economy. In fact, as the bank's oil expert Damien Courvalin said "to achieve the 5.9% decline suggested by the weekly data, our model requires PCE to contract 6%, in other words, a recession."

Submitted by Raul Ilargi Meijer via The Automatic Earth blog,

Small Businesses Love Trump

The National Federation of Independent Business (NFIB) Research Foundation has been conducting surveys on small business economic trends since 1973. One of the primary indicators that the organization tracks is the Index of Small Business Optimism. This index gives investors and economy observes insights into the current state of small businesses. This is especially important in the U.S. as small businesses employee 90% of the workforce and account for close to 50% of nonfarm GDP.

The Trump Presidency continues to be a boon for stock investors with Trump’s tweeting having become a kind of administrative PPT that ignites a new rally any time stocks are in danger of breaking down.

However, the reality is that Trump can only tweet the markets into rallying for so long. Trump is inheriting an eight years of the most profligate Fed monetary policy in history: a balance sheet expansion of $3.5 trillion, and seven years of ZIRP, which permitted the US to double its debt load.