The crude oil price collapse of 2015 has continued into 2016 with the price of oil plunging to a 12 year low of just under $30 per barrel as a consequence of a perfect storm of falling demand, primarily due to the slowing Chinese economy and relentlessly rising output that is not just limited to the usual OPEC suspects but is as the natural consequences of the fracking boom that continued to ripple out from the US to across the world during 2015.
The statistics provide some numerical support for assertions, voiced in the last few months by local and federal law enforcement officials, of a crime spike in 2015. But the snapshot is widely understood to be incomplete since the data from local law enforcement is reported to the FBI voluntarily, and not all agencies participate.
Corporate Socialism and Hollowing of America (Wilson S.)
The close connection between the US government and the financial sector through the operations of the US Federal Reserve is perhaps well understood. But less well understood is how corporate socialism has been operating less blatantly by the government over the decades, not just recently. For example, nearly 6 percent of GDP collected annually in indirect taxes comes substantially from import duties, which protect corporations from foreign competition at the expense of consumers. American corporations can charge the consumers more than otherwise for their products – an outcome which would be contrary to advice from neoclassical economics.
Gold Deficits and T-Bond Fantasies (GE Christenson)
President Nixon in 1971 thought long and hard about “closing the gold window” and decided against it, in spite of heavy lobbying from his powerful banker friends. Instead he ordered that all excess expenditures be funded from the US gold stored at Fort Knox instead of from borrowed dollars. Trucks left Fort Knox and the other gold depositories every week, drove to New York, and delivered gold to the foreign and domestic creditors of the US who had accepted dollars in trade for goods, oil, foreign aid, services, and military support. This continued for a very long time and the government eventually ran balanced budgets. (Remember – fantasy!)
Silver Hitting Major Support (Taki T.)
Silver is forming a triangle, and it is hitting support right now. Moreover, the resistance line (in purple) is very close to hitting support. In other words, silver has to choose a direction pretty soon. Given this chart formation, we believe that 2016 will be the year in which the market will have to make a choice, and basically there are only two options: break out or break down.
The rationale is simple: the trillions in fungible, excess cash the Fed unleashed in the wake of the crisis has driven asset prices into bubble territory and at this juncture, there’s essentially nowhere to go but down.
In the two years past World War I, the German government added to the monetary base of the Papiermark by printing money. Economic historian Carl-Ludwig Holtfrerich said that the “lubricant of inflation” helped breathe new life into the private sector.
The mark was trading for a low value against the dollar, sterling and the French franc and this helped to boost exports. Industrial output increased by 20% a year, unemployment fell to below 1 percent in 1922, and real wages rose significantly.
While many precious metal investors belly ache about the falling paper price of gold and silver, demand for the physical metals continues to rise…. especially silver. In 1996, total Silver Eagle sales for the year were 3,466,000. Now compare that to the 4,950,000 Silver Eagles sold in the first half of January. We must remember, Silver Eagle sales in 2016 started on January 11th. So, in just six working days (this Monday was a holiday), the U.S. Mint sold 43% more Silver Eagles than all of 1996.
Indeed, we’re already hearing the not-so-distant rumblings of this oncoming default freight train as JP Morgan raises its net loan loss reserves for the first time in 22 quarters, Wells Fargo discloses $17 billion in “mostly” junk energy exposure, and Citi dodges questions about the reserves it’s holding against a $58 billion energy book that the bank may or may not be marking to market depending on what the Dallas Fed “didn’t” tell banks earlier this month.
Even Oil Can’t Save Saudi Arabia (Tiffany D.)
Right now, the structure is a stubby concrete skeleton rising from the desolate sands outside the Red Sea port city of the same name. The Saudis created an investment fund worth $2.2 billion to build the tower, plus another $20 billion to develop the larger project, “Jeddah Economic City,” at the base of the tower.
Petrobras faces a variety of problems that will likely hold the company back for years and keep risk averse investors away from the story. First the company has a massive debt load – more than $125B in total. The past decade has been a relatively good time for companies to hold debt as funding costs were low and bond investors were willing to snap up virtually any new offering.
The goal of The Self-Reliance Catalog is to help you know better what is worth getting and where and how to do the getting, whether that “thing” is a plant, a tool, a book, or even a design for a home or greenhouse.
The study—The New Plastics Economy: Rethinking the future of plastics (pdf)—introduced at the opening day of the WEF’s annual summit in Davos, Switzerland is the first of its kind to comprehensively assess global plastic packaging flows. The report makes an economic case for what it calls the “New Plastics Economy,” described as “a new approach based on creating effective after-use pathways for plastics; drastically reducing leakage of plastics into natural systems, in particular oceans; and decoupling plastics from fossil feedstocks.”
Gold & Silver
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."