By EconMatters
Central Banks Need to either go all the way with Policy Goals, or get out of financial asset purchases altogether. The current stop and start cycling sets the financial markets up for huge crash scenarios every ten years.
https://www.youtube.com/watch?v=YSFjNvcwrnM
© EconMatters All Rights Reserved | Facebook | Twitter | YouTube | Email Digest | Kindle
Gold is perhaps the most maligned asset class in the world.
On an almost weekly basis the financial media mocks Gold and publishes articles claiming it is a terrible investment.
It’s rather odd, as less than 1% of investors actually owns Gold. Why is it so important to trash an asset class that almost no one actually owns?
Actually, forget that question, I’d like to see answers to these questions instead…
If owning Gold is such a bad idea…
· Why are Central Banks buying it?
Submitted by David Stockman via Contra Corner blog,
There has never been a more destructive central banking policy than the Fed’s current maniacal quest to stimulate more inflation and more debt. That’s what is killing real wages and economic vitality in flyover America - even as it showers prodigious windfalls of unearned wealth on Wall Street and the bicoastal elites who draft on the nation’s vastly inflated finances.
Last November, capital markets were discounting a rate hike five months later, based on Fed Funds futures. Same story today. Last November, the S&P 500 was trading near 2100. Same story today. Last November, VIX levels were around 14. Same story today. Last November, instead of waiting five months, the Fed hiked rates one month later; the S&P dropped by 10% over the next eight weeks... And as BofAML's Savita Subramanian warns, hiking during a profits recession usually hasn't ended well.
Submitted by Gregory Brew via OilPrice.com,
On Thursday Brent crude rose above $50 while the WTI rose to $49.85. The rise in prices came after the EIA reported a dramatic fall in U.S. inventories. The weekly drop of 4.2 million barrels, far more than the 2 million that was expected, triggered a sharp rise in a market which had been growing increasingly bullish, sending the Brent price above $50 on Thursday morning. It is the first time in seven months that the price has reached this level.