I had a very interesting conversation with one my colleAgues yesterday about the markets and the economy. Essentially the discussion centered around the markets remaining near their all-time highs as economic data remained soft. Much like the “300″ that defended Greece against the massive invading force of Persia, it is only a question of time before the battle is lost.
Equifax, which profits from the process when more people apply for credit and load up on debt, sees the miracles of the current economy this way: “American consumers continue to show signs they are recovering from the Great Recession by steadily increasing their credit card debt….”
In its report on credit card debt, Equifax raved about these newly empowered American consumers that are once again buying things they can’t afford and charging these purchases to their credit cards because they didn’t have enough money to pay for them otherwise, given their stagnating salaries. It shows up in the numbers:
Opening a gold mine is a costly endeavor. Simply finding a deposit, exploring potential reserves, navigating governmental bureaucracy and environmental red tape, and building the necessary facilities can have a project bogged down before it even gets to the point of extraction.
But what if I told you there was a mine already built, permitted, and operational… That early indications suggested as much as 800,000 ounces of gold were present… And that the only thing left to do was to get to work?
That’s exactly the position in which Pershing Gold Corp. finds itself. The company is literally sitting on a gold mine, poised to take the final leap into full-fledged production in a matter of months.
And if gold prices stabilize, it could be extremely profitable.
In 2011 Rand Paul stood on the floor of Congress and delivered a stark warning to Americans. To criticisms of sensationalism and embellishment, Paul noted that Federal laws on the books characterize those who have guns, seven days worth of food or ammunition in their homes as potential terrorists.
Know good and well that some day there could be a government in power that is shipping its citizens off for disagreements… Someone who has guns, someone who has ammunition that is weatherproofed, someone who has more than seven days of food in their house can be considered a potential terrorist.
If you are suspected by these activities do you want the government to have the ability to send you to Guantanamo Bay for indefinite detention?
The commodities slump has accelerated this past month with gold now trading at five-year lows and the U.S. crude benchmark, West Texas Intermediate (WTI), down 19 percent in just the past month, 49 percent on the year, and 57 percent in the past two years. In early morning trade, WTI is at $47.82 versus $110 two years ago.
Minutes of the Federal Reserve’s Open Market Committee meeting on December 16 and 17 reveal that the Fed was expecting an upturn in oil prices this year, writing: “…inflation was projected to reach the Committee’s objective over time, with longer-run inflation expectations assumed to remain stable, prices of energy and non-oil imports forecast to begin rising next year, and slack in labor and product markets anticipated to diminish slowly.”
This erosion of opportunities to complete life’s stages and core dramas is rarely recognized, much less addressed.
The idea that human life subdivides rather naturally into stages is based on our natural progression from childhood into adulthood and eventual (if we’re lucky) old age.
Confucian thought views life as a developmental process with seven stages, each roughly corresponding to a decade: childhood, young adulthood (16-30), age of independence (30-39), age of mental independence (40-49), age of spiritual maturity (50-59), age of acceptance (60-69), and age of unification (70 – end of life).
Each stage has various tasks, goals and duties, which establish the foundation for the next stage.
Gold and silver remain close to their lows for the year, discouraged as usual by dollar resilience.
Precious metals appear to be in limbo: speculative buyers are discouraged above all by their disappointing performance during the Greek crisis, and the possibility that a Chinese stock market crash might lead to forced selling of gold by Chinese speculators. So far, the latter concern has proved unfounded with public demand in China accelerating on lower prices and exceeding global mine output on its own. As well as Chinese demand, anecdotal evidence tells us that at these prices physical demand from the public has increased elsewhere, with gold sovereigns becoming scarce in London. And our dealers yesterday reported buyers outweighing sellers this week.
Desultory trading has led to a large fall in open contracts in gold futures on Comex, with the August contract running off the board instead of being rolled forward. This is shown in the next chart, and we can assume that this will have relieved the oversold condition somewhat.
After nearly three decades of stagnation, Japan in 2013 went all-in, ordering its central bank, the Bank of Japan, to buy pretty much every bond on the market with newly-created yen. The BoJ’s balance sheet — a rough proxy for the amount of money it has created and dumped into the economy — soared at a rate that dwarfs, in relation to GDP, the US Fed’s QE programs.
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