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    Daily Digest 1/31 – Gold Climbing the Wall of Worry, This Is the Age of Weather Extremes

    by DailyDigest

    Thursday, January 31, 2019, 8:14 AM


Why the next 48 hours are crucial to financial markets (Thomas R.)

Powell had already said the balance sheet would be “substantially smaller” than it is now, but he had another run-in with markets when he said in early October that the Fed was far from a neutral rate. Fed officials including New York Fed President John Williams have recently stressed that they are watching economic reports and will go slow when it comes to raising rates.

Federal Reserve To Embark On Monetary Policy ‘U-Turn’ (Thomas R.)

Gold’s move come as the Federal Reserve is expected to strike a dovish tone in its monetary policy statement and in central bank chair Jerome Powell’s ensuing press conference. Central bank officials, including Powell, have been hesitant to signal further tightening in monetary policy following its December hike. In two events at the start of the year Powell said that because of low inflation pressures, the Federal Reserve can be “patient” on interest rate hikes. According to media reports, the central bank could also signal a slowdown in its balance-sheet reduction program, which Powell has previously described as on auto-pilot.

Goldman Commodity Head Currie: Gold Is Top Pick Right Now, $1,450 Target (Thomas R.)

When asked what his current top commodity pick is, Global Head of Commodities Research in the Global Investment Research Division at Goldman Sachs Jeffrey Currie doesn’t hesitate: “Long gold.”

Gold Climbing the Wall of Worry (GE Christanson)

Stock markets rolled over and fell in late 2018. The NASDAQ 100 was down 23% at its low from its all-time high in October. The Index has since retraced half its loss and is down (Jan. 30) about 11%. Most stocks are down larger percentages. They call it a bear market. Remember the devastation of 2008 when debt was much lower, valuations less extreme, and the U.S. was less politically polarized. The Federal Reserve and politicians will “save” themselves and the political and financial elite. All others… well, good luck…

Silver Shortage Promises to Boost Price in 2019 (Thomas R.)

To be sure, a production deficit hasn’t been enough to boost prices in recent years. Silver has traded more like a precious than an industrial metal, which is strongly influenced by supply and demand balances. The price of silver has plunged by almost half since 2012, the last time the market was in surplus. That was faster than the pace of decline for gold, the most heavily traded precious metal.

Why Are Young People Pretending to Love Work? (tmn)

This is toil glamour, and it is going mainstream. Most visibly, WeWork — which investors recently valued at $47 billion — is on its way to becoming the Starbucks of office culture. It has exported its brand of performative workaholism to 27 countries, with 400,000 tenants, including workers from 30 percent of the Global Fortune 500.

Fruit juices, for kids and adults, may include lead and other metals, study finds (Thomas R.)

Drinking lots of fruit juice could compound their risk, the researchers say, because children may also encounter elevated levels of heavy metals in baby foods, rice products, and other foods, as well as from water and the environment.

California utility equipment sparked more than 2,000 fires in over three years (tmn)

Lacking the manpower and sophisticated technology necessary to monitor more than 250,000 miles of power lines across the state, regulators rely on something of an honor system, with utilities responsible for ensuring all trees and vegetation are cut back far enough from electrical equipment before the onset of dry, high-fire danger conditions.

Bankrupt California Utility Shedding More Than $40 Billion Worth Of Green Energy Contracts (Thomas R.)

The goals set by government officials were optimistic before PG&E filed for bankruptcy Tuesday. California’s grid operator has paid surrounding states on several occasions to take excess power off California’s grid caused by overproducing solar and wind farms.

The Major Risk That Oil Markets Are Underestimating (Michael S.)

On top of that, Venezuela’s shipments to the U.S. were the only ones that earned the country hard currency. The bulk of its shipments elsewhere – mainly to China and Russia – are sent as repayment for past loans. In other words, PDVSA does not take in cash for its oil shipments to those countries. Presumably, additional shipments to China, Russia or India in lieu of the lost market in the U.S. Gulf Coast could be sold for cash, but Maduro’s government is without leverage, which means the discounts will be painful.

U.S. Midwest Freezes, Australia Burns: This Is the Age of Weather Extremes (tmn)

“When something happens — whether it’s a cold snap, a wildfire, a hurricane, any of those things — we need to think beyond what we have seen in the past and assume there’s a high probability that it will be worse than anything we’ve ever seen,” said Crystal A. Kolden, an associate professor at the University of Idaho, who specializes in wildfires and who is currently working in Tasmania during one of the state’s worst fire seasons.

A January Heat Wave in Australia (tmn)

After just experiencing the warmest December on record, much of Australia is still enduring a sweltering January, with many new high-temperature records being set. The brutal heat waves have resulted in health warnings being issued, telling residents to stay indoors and to take special notice of animals in their care. Overtaxed power grids have failed several times, leaving thousands without power; wildfires are burning in Tasmania; and wild animals are suffering as watering holes dry up. Last week, the town of Port Augusta set a new record high of 121 degrees Fahrenheit (49.5 degrees Celsius). Forecasts have the heat lasting at least through the end of January, possibly leading to yet another hottest-month record.

Gold & Silver

Click to read the PM Daily Market Commentary: 1/11/19

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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