This is where things stand after the dust has settled in global markets.

Later today KWN will be releasing a timely audio interview discussing the pullback in gold and silver, what to expect next and much more. In the meantime…

Inflation At The Highest Level Since 2008
September 13 (King World News) – Peter Schiff: Economic (growing pain on each side and our big mistake of taxing consumer goods in a consumer driven economy) and political realities (an upcoming election campaign) is finally driving the trade negotiations it seems that of course is taking the S&P’s back to the highs. On the other hand, rates continue to rise and what does the Fed do now? An 11 yr high in core inflation and a possible trade resolution of some sort doesn’t make the decision easy. Do me a favor, each time you hear expressed worries next Wednesday from the FOMC statement and Jay Powell in his press conference that inflation is too low, remember that core CPI has a 2 handle for 18 straight months and is at the highest level since 2008…


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Bond Yields Rising Around The World
The Japanese 10 yr JGB yield jumped 6 bps to -.15% on further expressed worries on the part of the BoJ in the drop in long rates along with the global selloff in bonds. That is the biggest one day move since August 2018. People, this is an epic change that the BoJ is all of a sudden worried about rates falling too much. The German 10 yr bund yield is back above -.50% for the first time since August 2nd. The US 10 yr yield at 1.81% is also at the highest point since August 2nd.

Doubts About Negative Interest Rates
Finally seeing the tiering from the ECB, thus exempting some bank deposits from taxes, is seeing the European bank stocks rallying again. Amazingly, just a day after the ECB policy news, two dissenting members are already out criticizing the Draghi move. The Austrian ECB member even questioned the point of trying to get to 2% inflation. “It may be that the 2% is at the moment out of reach, and 1.5% also signifies stable prices. So there is no need to try to use all the power you have to move up to 2% if the costs are too high.” As for the idiocy of negative rates, “A number of members of the council had the thinking about it that moving further in the negative territory is not the way to go. It’s not sustainable. It was the way at the time when we had liquidity issue, but it can’t be something which continues very long.” The hawkish Dutch member said with regards to everything announced, “there are sound reasons to doubt its effectiveness.”

Peak Central Bank Activism
Again, I believe it’s becoming more obvious that we’ve reached peak activism with the ECB and BoJ. I don’t know the extent of where this rise in global rates go but I get more and more confident that the August lows in interest rates will be in place for a while.

As for the ECB getting the higher inflation it wants, Eurostat announced today that labor costs in the Eurozone in Q2 rose 2.7% y/o/y, the quickest pace since September 2009. I mean just imagine if the ECB gets the higher inflation it wants, pity the holders of these negative yielding bonds.

The British pound is ripping higher, above $1.24, the highest level since late July as there are some hopes that BoJo, Parliament and the EU can figure something out before Oct 31st. Boris is meeting with EU President Juncker on Monday. The dollar is also selling off against other currencies on trade deal hopes. The pound is cheap and pound denominated assets seem very attractive still.

Later today KWN will be releasing a timely audio interview discussing the pullback in gold and silver, what to expect next and much more.

Violent Trading In The Gold Market And A Warning
READ THIS NEXT! Today’s Violent Trading In The Gold Market And A Warning For Stock Market Bulls
 CLICK HERE TO READ

More articles to follow…

In the meantime, other important releases…

Gold Surges More Than $25 As ECB Cuts And Launches QE, Plus A Look At Today’s Big Surprise CLICK HERE TO READ

MAJOR GOLD UPDATE RELEASED: Massive Upside Target Along With Limited Downside Target CLICK HERE TO READ

An Important Look At Gold And The US Dollar, Plus The Chart Of The Day CLICK HERE TO READ

Today’s Market Note From UBS Legend Art Cashin, Who Has Sent Out These Notes For Well Over 3 Decades CLICK HERE TO READ

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