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    Daily Digest 1/10 – Where the Next Crisis Starts, What’s Next For The Dollar, Gold, Stocks and Bonds?

    by DailyDigest

    Thursday, January 10, 2019, 7:28 AM


China-U.S. trade talks end 2nd day with no sign of progress (Uncletommy)

Chinese officials have suggested Beijing might alter its industrial plans, but they reject pressure to abandon a strategy seen by communist leaders as a path to prosperity and greater global influence. They have tried to defuse pressure for more sweeping change by offering trade concessions including purchasing more American soybeans, natural gas and other exports.

Fed's Bullard takes stand against more interest rate hikes (Adam)

At the December meeting, FOMC officials indicated two more increases could be coming this year to the benchmark funds rate target, which currently sits between 2.25 percent and 2.5 percent. However, markets are pricing in no hikes this year and possibly a rate cut in 2020, which Bullard said he would be open to if conditions deteriorate.

Here’s Where the Next Crisis Starts (thc0655)

Typically, small investors (and some bankrupt banks) get hurt the worst while the big banks get bailed out and live to fight another day.

That much panics have in common. What varies in financial panics is not how they end but how they begin. The 1987 crash started with computerized trading. The 1994 panic began in Mexico. The 1997–98 panic started in Asian emerging markets but soon spread to Russia and the big banks. The 2000 crash began with dot-coms. The 2008 panic was triggered by defaults in subprime mortgages.

What’s next for the dollar, gold, stocks & bonds? (Axel M.)

Joking aside, the Fed had been on a set course to let its large Treasury holdings run off (engage in so-called quantitative tightening or “QT”) and to raise rates. Until last summer, Powell had made it clear that even with the higher rates, the Fed was still “accommodative”; in December, after the 4th 0.25% rate hike of 2018, the FOMC statement stated that the interest rates had now reached what some at the Fed considered to be neutral, implying rates would need to move higher – especially since he had indicated a few months earlier that rates may need to move above neutral. He had also suggested not to touch the QT program, so as to not to confuse the markets with multiple policy tools.

Eccles Prison Blues – The Big Squeeze (GE Christenson)

Their game, their rules. We are stuck in their debt-based fiat currency system. Fiat money apologists spout the nonsense that not enough gold exists to back these digital currencies because governments, commercial banks and central banks have created excessive debt. They pumped too many digital Federal Reserve Notes into economic circulation and pushed prices higher. The Federal Reserve makes the rules, and they want the price of gold to remain low and not parallel the rise in the number of currency units.

What Apple’s Tailspin Means For Oil Prices (Michael S.)

The ongoing trade war also continues to put downward pressure on oil prices amid concern over oil demand growth not just in China, but globally. The so-called OPEC+ group of producers, that includes production heavyweights Saudi Arabia and Russia, agreed last month to try to soak up extra oil supply and prop up oil prices which have dropped nearly 40 percent since reaching four-year highs in October.

Flaws With a “Green New Deal,” Part 1 of 2 (thc0655)

The very term “New Deal” was chosen to appeal to the 20%+ of the unemployed in the workforce, who had ostensibly been left behind by the traditional U.S. economic system. Yes, Ocasio-Cortez and her supporters are touting the Green New Deal as (among other things) the solution to lingering economic inequities in the current system. But to call concern over a wage gap a “New Deal” is as inapt as christening a bullet train program a “Green Moon Shot.”

China gives long-awaited GM crop approvals amid U.S. trade talks (Uncletommy)

The approvals came as farmers in North America were deciding which seeds to plant this spring. China before the trade war bought some 60 percent of U.S. soybeans and U.S. farmers do not widely plant varieties it has not approved.

Gold & Silver

Click to read the PM Daily Market Commentary: 1/9/19

Provided daily by the Peak Prosperity Gold & Silver Group

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the “3 Es.”

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