As we continue trading in the final week of 2021, here is a look at never before in history, another gold bull catalyst, plus real estate and meanwhile in Europe.
Never Before In History
December 29 (King World News) – Egon von Greyerz: We must remember that NEVER BEFORE IN HISTORY has there been a global Debt crisis of this magnitude. Never before have debt bubbles at this level in Europe, in North and South America, Asia, Africa and Oceania synchronised at the levels we are now experiencing.
Holding physical Gold is like putting your money on black on a roulette table with only black numbers. You know that you will win every time, as history proves with 100% certainty that governments will continue to destroy the currency and thus the Economy…
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Yet Another Gold Bull Catalyst
Peter Boockvar: The US trade deficit for goods in November rose to a record high of $97.8b and that was well above the estimate of $88.1b and means we’ll likely see some trimming of Q4 GDP estimates. Exports fell 2.1% m/o/m while imports jumped by 4.7% m/o/m. Of course the timing of getting product from point A to its eventual destination has been turned upside down so I can’t even begin to normalize what these numbers would have been otherwise.
US Trade Deficit Tumbles To Worst Level In History
Real Estate
Pending home sales in November fell 2.2% m/o/m, under the estimate of a gain of .8% but it does follow a 7.5% increase in October.
Pending Home Sales
While the lack of inventory remains a problem, the very sharp home price increases in response are also impacting spending decisions as many first time buyers in particular are getting priced out unfortunately and are choosing to rent instead, even with sharp cost increases there too. Also, we know Zillow threw in the towel on their iBuyer business, and will lose money on many of them bought, and we’ll see to what extent institutional buyers also get more price sensitive in 2022…
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The NAR said “There was less pending home sales action this time around, which I would ascribe to low housing supply, but also to buyers being hesitant about home prices.”
Bottom line, it’s clear that the housing market a few months ago reached a pain pressure point on prices and in response we’ve seen the peak in home price gains. Yesterday the S&P CoreLogic y/o/y increase in October was 18.4%, still ridiculous but the slowest pace since May although also helped by tougher comps.
Home Price Increases Remain Strong
Taking out the influence of comps though, the seasonally adjusted m/o/m gain in October was 1%, the lowest rate of change since July 2020. A slowdown is desperately needed if we’re going to have homeownership remain a realistic goal for many.
Meanwhile In Europe
Finally, we’re seeing a decent selloff today in European bonds which in turn is leading to the rise in US long rates. Who knows if this is just year end noise but the ECB is also just a few months away from ending its PEPP, partially offset by an increase in their other asset purchase program. The German 10 yr bund yield is higher by 4.2 bps to -.19%, the least negative in almost 2 months.
The Italian 10 yr BTP yield is up by 6 bps to 1.16%, just 5 bps from the highest since July 2020. These yields compare with the 5 yr 5 yr euro inflation swap at 1.95%, up 3 bps today.
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To listen to Matthew Piepenburg discuss why gold is set up for huge upside gains in 2022 as well as what other major surprises to expect next year CLICK HERE OR ON THE IMAGE BELOW.
To listen to Alasdair Macleod discuss why silver and gold are set up for huge upside gains in 2022 CLICK HERE OR ON THE IMAGE BELOW.
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