Here is a look at inflation plus a big deal for silver bulls.
April 26 (King World News) – Peter Boockvar: While we might not get any change in messaging from Jay Powell & Co. this week, the pressure is only intensifying for them to at least begin the taper process of a QE program that does absolutely nothing to spur economic growth. Instead, it has become just a debt monetization vehicle and an arm of the US Treasury along with creating the perception to markets of easy policy. The Bank of Canada is tapering. The Bank of Japan is tolerating more of a trading range around its yield curve control. And Bloomberg reported last week that the discussions at the ECB are about to heat up on tapering their emergency purchase program.
If you didn’t see it, a WSJ editorial over the weekend talking about the outside push for more race and gender diversity on the FOMC said “No doubt diverse experience and points of view can be valuable. But if the Fed suffers from groupthink, the reason isn’t gender or race. It’s the lack of differing views on monetary policy. The current lineup of Fed governors and regional presidents seem to have the most uniform viewpoint of any era we can recall. The first speeches by the Feds’ newest governor Christopher Waller have been notable mainly for cheerleading for the polices of his new home team… Disagreement for its own sake is no help, but with the Fed undertaking one of the most radical monetary policy experiments in history, you’d think there would at least be more debate.”
While commodity prices are just one piece of the inflation story, they still remain a notable symbol of the supply demand imbalances our economy has right now. So, ahead of the FOMC this week, copper prices are rallying almost 2% today to a fresh 10 year high.
Copper Continues To Soar
Corn is up for the 6th straight day and 15% during this short time frame.
Corn Prices Continue To Spike
Soybeans are up for the 10th straight day, equaling 12%. Wheat is up 11% since last Monday. Tomorrow, S&P CoreLogic will tell us that home prices rose about 11.8% in February in the 20 biggest cities y/o/y. Lastly, if you didn’t see last week, United Microelectronics last week said they are raising semi prices by 40% in 2022.
The Inflation Debate
The debate on inflation right now and whether it’s temporary or not is missing a key piece, that being the level of rates that inflation is currently occurring with. In other words, we don’t need high inflation to cause a problem, just higher inflation because the level of global interest rates is just still so low. If we didn’t have negative interest rates overseas, if we didn’t have zero rates in the US, if we had a 10 yr yield that was maybe 3%, the world’s bond markets would be better able to handle and absorb a higher rate of inflation. But, with where they are now, they are completely unprepared for inflation surprises, even modest ones.
Also of importance…
Big Deal For Silver Bulls!
Santacruz Silver Mining is pleased to report that it has completed the previously announced acquisition of the Zimapan mine assets from Minera Cedros, a wholly owned subsidiary of Grupo Peñoles. The transaction was funded in part by a US$17.6 million loan facility…
To find out which silver company just made a major acquisition that will
quadruple their production click here or on the image below
Carlos Silva, CEO of Santacruz stated, “Closing the transaction and acquiring outright ownership of the Zimapan Mine marks a new era for Santacruz that will help pave the road for the continuation of the Company´s growth. Beyond the mineralized zones currently being mined, management believes there is great untapped potential contained in the Zimapan mine´s 5,000 hectares of mining claims. We have already identified several priority areas for exploration which we expect will allow the mine to maintain its historical yearly production levels of +5 million silver equivalent ounces for many years.” …SantaCruz Silver, symbol SCZ in Canada and SZSMF in the US.
***To hear Gerald Celente discuss what shocks to expect in 2021 CLICK HERE OR ON THE IMAGE BELOW.
***To hear Alasdair Macleod discuss why gold and silver prices are set to soar in 2021 CLICK HERE OR ON THE IMAGE BELOW.
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