Look at what just hit an all-time record…
June 16 (King World News) – James Turk: Because of worsening inflation expect the FOMC to talk about future tapering of asset purchases just like Bernanke talked about winding down QE which didn’t happen and won’t because banks need to turn US government deficits into currency. US dollar continues on 1-way street toward cliff edge…
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Peter Bocckvar: I’ll be brief on the Fed until this afternoon. I want to hear what their updated definition of ‘substantial progress’ is in terms of achieving their goals. So, what does ‘maximum employment’ mean in the context of a record 9.3mm job openings? And what does ‘price stability’ mean to them because the last thing we have right now is stable prices.
By the way, last week saw the easiest financial conditions on record according to the Goldman Sachs survey. What would also be nice, but we won’t get it, is an explanation from Jay Powell of the direct and empirical benefit of QE to the economy. I don’t believe there is any and remains just a tool of the US Treasury to finance its deficits and a psychological boost to asset prices.
WHAT COULD POSSIBLY GO WRONG?
GS Financial Conditions Index Hits All-Time Record!
This was a great quote yesterday from my friend Danielle Dimartino Booth at Quill Intelligence when she said this about the Fed and its policy impact on housing. “The lesson: You can ‘break’ the housing market with too much tightening AND too much easing, which seems odd to even write.” The MBA today said that purchase apps rose 1.6% w/o/w but are down now by 17% y/o/y. We certainly know full well what is going on in the US housing market. Refi’s rebounded by 5.5% after 3 straight months of declines that saw a one yr low but they are also down by 22% y/o/y. The average 30 yr mortgage rate fell by 4 bps to 3.11% coincident with the drop in the 10 yr Treasury yield.
China reported some key May data and while it reflected the easy comps, the rate of gain moderated from April and the numbers were slightly below expectations. Retail sales increased by 12.4% y/o/y vs the estimate of up 14% and down from a gain of 17.7% in April. Industrial production grew by 8.8% vs 9.8% last month and 4 tenths less than the forecast. Both property investment and fixed asset investments year to date rose double digits y/o/y but also a touch less than expected.
While the Chinese economy has exceeded its pre pandemic size, consumer spending has lagged relative to the industrial and fixed investment components. The hope is that personal spending continues to catch up. A spokesperson for the National Bureau of Statistics said “As the economy gradually recovers, economic growth is gradually returning to the normal state of being driven by domestic consumption.” I argue again that the Chinese consumer will be the most important global economic driver in the coming decade just as the US consumer was in the past few. … Copper prices are unchanged but have of late come off the boil after a hitting a 10 yr high last month. The yuan is up a touch vs the dollar and remains at 3 yr highs.
Also just released: Gold And Miner Pullback, Plus Up For 13 Straight Years! CLICK HERE.
Also just released: Monetary Madness Continues, But Look At What Is Happening To Prices CLICK HERE.
Also just released: Turk – At Last Gold & Silver Prices Are Going To Be Free From Manipulation CLICK HERE.
***To listen to Gerald Celente discuss his prediction that silver is headed to new all-time highs, gold, and the big surprises to expect in the back half of this year CLICK HERE OR ON THE IMAGE BELOW.
To listen to Alasdair discuss what to expect in the gold and silver markets going forward CLICK HERE OR ON THE IMAGE BELOW.
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