There is an old expression on Wall St. that says, "the market can act irrational longer than you can stay solvent." From where I sit, the market is definitely in the irrational stage. I see a big correction coming, but the powers-to-be will do everything to prove me and others wrong.
First Piece
fell last week in China. For years China has instituted "make work" projects that has a labor force of 136 million people employed. Real estate projects like a complete city, capable of holding one million people, now built and sit completely empty. Tall, new skyscrapers that house only a passing bird nest. In busy locations prices have risen ten-fold and amazingly, no end in sight until now.
Kaisa Group Holdings Ltd.(1638)
is a Chinese real estate developer that missed a loan payment of $23 million on its dollar-denominated bond. Kaisa borrowed $500 million of a 2020 bond. There are many repercussions as the ripple in the water travels far.
Consider that the World Bank estimates that China influences 16% of world economic growth. Not only that, Chinese companies made up 62% of all US dollar bond sales in the Asia-Pacific region. Black Rock Inc. holds 8.875% of the Kaisa debt and JPMorgan Chase, Fidelity and ING also hold some Kaisa debt.
"Debt Must Be Repaid"
stated the IMF chief last week, however she was referring to Greece. Nevertheless, the truth is true for everyone, but that is not the only problem. Building empty cities makes one wonder when the punch bowl will go empty. I guess the local government in Shenzhen feels the same way. They blocked all sales of Kaisa, amounting to $300 million and stopped all their projects for now. This is only 15 miles from Hong Kong, but goes all the way to the capital. President Xi Jinping of China has stated he wants to crack down on rampant corruption and in Shenzhen that means Jiang Zunyu. He was the security chief until he got arrested for corruption and this guy is connected to Kaisa. In addition, China's real estate market showed declining prices in 65 of 70 cities. Not a good trend. The main problem is fixed books where down payments and margins are adjusted to meet requirements. This sounds like our past problem with "ninja" loans(no income, no job or assets).
Creditors are lining up and you know what that means...
Enter Lawyers
Everbright Bank Ltd. and Industrial & Commercial Bank of China have asked courts to freeze assets of Kaisa. Maybe this is just a small rock and the ripple will disappear, but then again, do you remember Ben Bernanke saying the housing crisis is contained in 2007?
Diastrophism
is happening. Here in the US, one small oil company whose name escapes me, filed for bankruptcy. Of course you heard of Baker Hughes and Halliburton. They both announced massive layoffs due to the falling price of oil. And then, there was a little announcement by the Swiss National Bank about breaking its peg to the euro. Can you feel the earth moving? All that shaking is disturbing the domino pieces. I'll call it, economic diastrophism and you can blame this too on the Fed which is why I say, End the Fed!
Wednesday, January 21, 2015
Thursday, January 15, 2015
Doctor Copper Caught The Flu
He caught it on the high seas. No, not from one of the cruise lines. He picked it up from global trade. You see, dear reader, the Baltic Dry Shipping Index reflects world trade. If you need coal in China, it arrives on a boat. When Japan imports natural gas to make up for the closing down of its nuclear reactors after the disaster of March 2011 at Fukushima, it has to import. It does not have natural resources. They are not alone. Global trade is done from port to port. When things are looking good and everyone is working like busy bees, the shipping index is at highs and conversely, when the hive has little honey, the index sinks like skipping a rock on water.
Yesterday
...all my troubles seemed so far away... Dr. Copper was giving interviews back in July 2012. He talked on-and-on about the housing recovery, consumer spending and how miners were ramping up supply to meet the needs of the industry. Copper was hitting highs at $4.25 a pound.
Today
...don't give me no dirty looks...takeout the trash...yakety yak, don't talk back...the doctor is confined to his bed. No house calls and please, don't phone. Copper just hit $2.42 a pound this week. The doctor called in a specialist, my good friend Sebastian. My buddy says the doctor actually caught the flu back in winter of 2013 when he was doing all those talk shows. The decline was sharp and the doctor inscribed to himself a flu shot after falling to $3.29 a pound. He recovered to $3.95 a pound, but the medicine of low interest rates wore off. He has been getting sicker and weaker ever since.
Sebastian tried to explain to him that the shipping index is also sick and the idea to take a cruise, to breathe in the salt air for a cure could cause more complications. My friend demonstrated the strain of flu is highly contagious and spreads from port-to-port. Back in the good old days, the Baltic index sailed at $2337 for day rates, and today, it is under water at $709 per day. Shippers are trying to make money by storing oil, but that is another story. The doctor fired my friend. He called for a second opinion. Mr. Lumber gave him a similar prognosis.
Sometimes you win, sometimes you lose
but lumber is quite stable and it usually has the right medicine to cure a flu, but his anti-biotic is not working this time. The virus of low wages and demographics are too resistant to the old medicine. Back in March 2013, the price of lumber was $3.56 and now, it is $3.10 which is a decline of 16% and falling. Mr. Lumber also mentioned the shipping index and to the dismay of Dr. Copper, the medicine that he administered last August sparked a recovery from $723. to $1484. However, resistance overtook the biotic and as stated by Sebastian, it is down to $709 per day and falling into deep do-do.
Yes, Mama and Papa, ...all the leaves are brown and the skies are gray...Good time Charlie has got the blues...
Yesterday
...all my troubles seemed so far away... Dr. Copper was giving interviews back in July 2012. He talked on-and-on about the housing recovery, consumer spending and how miners were ramping up supply to meet the needs of the industry. Copper was hitting highs at $4.25 a pound.
Today
...don't give me no dirty looks...takeout the trash...yakety yak, don't talk back...the doctor is confined to his bed. No house calls and please, don't phone. Copper just hit $2.42 a pound this week. The doctor called in a specialist, my good friend Sebastian. My buddy says the doctor actually caught the flu back in winter of 2013 when he was doing all those talk shows. The decline was sharp and the doctor inscribed to himself a flu shot after falling to $3.29 a pound. He recovered to $3.95 a pound, but the medicine of low interest rates wore off. He has been getting sicker and weaker ever since.
Sebastian tried to explain to him that the shipping index is also sick and the idea to take a cruise, to breathe in the salt air for a cure could cause more complications. My friend demonstrated the strain of flu is highly contagious and spreads from port-to-port. Back in the good old days, the Baltic index sailed at $2337 for day rates, and today, it is under water at $709 per day. Shippers are trying to make money by storing oil, but that is another story. The doctor fired my friend. He called for a second opinion. Mr. Lumber gave him a similar prognosis.
Sometimes you win, sometimes you lose
but lumber is quite stable and it usually has the right medicine to cure a flu, but his anti-biotic is not working this time. The virus of low wages and demographics are too resistant to the old medicine. Back in March 2013, the price of lumber was $3.56 and now, it is $3.10 which is a decline of 16% and falling. Mr. Lumber also mentioned the shipping index and to the dismay of Dr. Copper, the medicine that he administered last August sparked a recovery from $723. to $1484. However, resistance overtook the biotic and as stated by Sebastian, it is down to $709 per day and falling into deep do-do.
Yes, Mama and Papa, ...all the leaves are brown and the skies are gray...Good time Charlie has got the blues...
Thursday, January 8, 2015
OIL: Is It Being Manipulated?
The action in the oil pits makes me wonder if something is afoot. Don't classify me into one of those conspiracy schools until you get the facts. No, I'm not singing an old Beatles song,"...This happened once before. I came to your door. No reply..." Because like the Beatles, I saw the light in your window.
This happened once before
Remember the Libor rate fixing by the big banks? Remember the aluminum price rigging by Wall St. banks? And the ongoing investigation into the banks of Wall St. concerning the suppression of the price of silver? of gold? There are others. The point is made. These things happen. Oh, yeah, the biggie. Did you ever hear or remember the Plunge Protection Team(PPT)? It was created to "intervene" into the stock market after the crash of 1987. It consists of the Secretary of the Treasury, Chairman of the Broad of Governors of the Federal Reserve, Chairman of the SEC and Chairman of the CFTC. So, there is plenty of proof of past and present market manipulation.
Now, let us turn our attention to the price action in oil.
Three Years: 2012-2014
oil has held steady in a range from $90. to $105. dollars per barrel. There has always been an over cost built into the price due to geopolitical concerns. It is steep around twenty bucks. That meant oil should've been priced at around $70 to $85. per barrel.
Prior to the financial crisis of 2008, oil consumption grew at a steady 2 to 3% a year. In the 1980s oil usage held steady at 80 million barrels a day. With the advent of industrialization in China and India usage swelled to 90 million plus barrels a day in world consumption. In addition, prior to the world recession due to the financial crisis, world oil stocks were at a healthy 90 million. Then, there is Saudi Arabia which could be counted on to add swing supply. The big concern with oil was new discoveries. Brazil had the biggest, but it is too deep underwater to extract. This is still the case today.
US Tech and Innovation
with fracking innovation US production has increased by 50% since 2010. We are actually the number producer of oil: Not Saudi Arabia, not Russia nor Canada. This contribution should've relieved the geopolitical price concern, but it didn't until last year. It began to influence the market after the Russian intervention into Ukraine and later, annexing Crimea. Coincident? Before one assumes the answer, consider oil inventory levels. US inventory levels are posted every Wednesday and if you check it, this is the result. Our oil stocks were actually higher in 2012 and 2013, so how come the decline in oil took so long to take effect? In those years, we had about 397 million barrels of oil in reserve. Today, it is down to 382 million barrels. This contradicts the price action in oil as the US is the world's largest user. As for world stocks, they are down to barely cover world demand. Looking objectively at this piece of info, I would say that it is a wash. This is according to EIA, the Energy Information Administration. World production hovers at 90.136 a day and demand is at 90.370 per day. However, some of this demand is inventory building and not actual need. There is plenty of swing supply if needed. Bottom line: oil is plentiful and slowly building a glut in supply. The supply is actually 1% over demand, but this is a thin buffer. If a geopolitical event caused disruption, prices would rise again. In addition, there is a growing alternative energy supply. Total world energy is above demand. World produces 530 plus and it uses 528. If Compressed Natural Gas(CNG) cars were being sold, I could see oil fall, but that is not the case at present. Again, supply price should be neutral which places oil in the $70. to $85. range.
Pressing Buttons
No question, Russia stirred up trouble. There is really nothing no one can do about it, but then again, you can hit it where it hurts. Russia's economy centers on commodities with oil on top. Now, if one wanted to put a hurt on Russia, they could've started to short oil with big, big bucks. Question: Who has that kind of money? Who has the motivation?
CIA
is my guess and I'm thinking that they are the new member to the PPT. They have the money and the motivation. I think that they came up with another one of their half-ass plans. They put big money to work, but they forgot about the speculators and hedge funds. These people see big money move the price of oil. They jump on the trend and the original push to the $70. to $85. range, now is well past breaking $50. per barrel. By the way many other commodities are hurting too. Iron ore is down 65%.
New Problems
Price action in oil suggests that there is no resistance to this trend all the way down to $32. per barrel. This will cause high losses for oil produces like Canada's oil sand's. In addition, all the small oil frackers that entered the market by utilizing the Fed's cheap money at low rates will be in serious trouble. They will lose money on every barrel that they sell unless they hedged their production. Those hedges are usually only one year in duration. So, by next May, defaults will begin. You see, dear reader, smaller oil firms had to get their finances from high risk bonds. At present, this is 15% of the segment of the high yield bonds. Banks are on the hook for another 23% of their loan portfolio. The idiots who manipulated the market did not take into account the consequences of their actions, which is usually the case. As my man Forest Gump would say, "Stupid is what stupid does."
Of course, there are winners here. The paid shills in the media will remind you daily that the consumer benefits. Some people say that the consumer will have $700 billion extra to spend. That sounds great except the Republicans will steal some of it through state and federal taxes on oil for infrastructure. Yes, I'm making that prediction. They will use the same shills to inform you that we will be able to fund money for roads, bridges and create jobs. The same old same old. Instead of spending $500 plus billons for war and the military every year, we could've rebuilt America a long time ago. The shills never mention that aspect of our budget and the military complex and influence.
There will be other winners too. European consumers along with the economies of Korea, India and Thailand will all benefit. However, there are other more serious losers.
Foreign Loans
Emerging nations took some of the Fed's cheap money too. They grabbed and grew until now. The global community is slowing and those loans were made in US dollars. Guess what? The US dollar is rising which makes the loans more expensive. It is like an adjustable mortgage and now, your pay rate is higher because your money is worth less through devaluation. Shortfalls in budgets will really hurt. Venezuela needs oil at $121. per barrel. Nigeria needs oil at $119. per barrel. Iraq needs oil at $106. per barrel.
Commodity driven economies get their money from oil. Venezuela gets 51%. Norway and Russia get 19%. The list is long. I think you get the point. Australia derives 5.7% of its GDP from commodities, and South Africa is in the same boat. This means trouble in River City. Defaults could spread unless there is rollovers to the loans. This looks very iffy at present. Together, all these financial pressures could trigger a derivative and once that happens, you will agree with me, End the Fed!
This happened once before
Remember the Libor rate fixing by the big banks? Remember the aluminum price rigging by Wall St. banks? And the ongoing investigation into the banks of Wall St. concerning the suppression of the price of silver? of gold? There are others. The point is made. These things happen. Oh, yeah, the biggie. Did you ever hear or remember the Plunge Protection Team(PPT)? It was created to "intervene" into the stock market after the crash of 1987. It consists of the Secretary of the Treasury, Chairman of the Broad of Governors of the Federal Reserve, Chairman of the SEC and Chairman of the CFTC. So, there is plenty of proof of past and present market manipulation.
Now, let us turn our attention to the price action in oil.
Three Years: 2012-2014
oil has held steady in a range from $90. to $105. dollars per barrel. There has always been an over cost built into the price due to geopolitical concerns. It is steep around twenty bucks. That meant oil should've been priced at around $70 to $85. per barrel.
Prior to the financial crisis of 2008, oil consumption grew at a steady 2 to 3% a year. In the 1980s oil usage held steady at 80 million barrels a day. With the advent of industrialization in China and India usage swelled to 90 million plus barrels a day in world consumption. In addition, prior to the world recession due to the financial crisis, world oil stocks were at a healthy 90 million. Then, there is Saudi Arabia which could be counted on to add swing supply. The big concern with oil was new discoveries. Brazil had the biggest, but it is too deep underwater to extract. This is still the case today.
US Tech and Innovation
with fracking innovation US production has increased by 50% since 2010. We are actually the number producer of oil: Not Saudi Arabia, not Russia nor Canada. This contribution should've relieved the geopolitical price concern, but it didn't until last year. It began to influence the market after the Russian intervention into Ukraine and later, annexing Crimea. Coincident? Before one assumes the answer, consider oil inventory levels. US inventory levels are posted every Wednesday and if you check it, this is the result. Our oil stocks were actually higher in 2012 and 2013, so how come the decline in oil took so long to take effect? In those years, we had about 397 million barrels of oil in reserve. Today, it is down to 382 million barrels. This contradicts the price action in oil as the US is the world's largest user. As for world stocks, they are down to barely cover world demand. Looking objectively at this piece of info, I would say that it is a wash. This is according to EIA, the Energy Information Administration. World production hovers at 90.136 a day and demand is at 90.370 per day. However, some of this demand is inventory building and not actual need. There is plenty of swing supply if needed. Bottom line: oil is plentiful and slowly building a glut in supply. The supply is actually 1% over demand, but this is a thin buffer. If a geopolitical event caused disruption, prices would rise again. In addition, there is a growing alternative energy supply. Total world energy is above demand. World produces 530 plus and it uses 528. If Compressed Natural Gas(CNG) cars were being sold, I could see oil fall, but that is not the case at present. Again, supply price should be neutral which places oil in the $70. to $85. range.
Pressing Buttons
No question, Russia stirred up trouble. There is really nothing no one can do about it, but then again, you can hit it where it hurts. Russia's economy centers on commodities with oil on top. Now, if one wanted to put a hurt on Russia, they could've started to short oil with big, big bucks. Question: Who has that kind of money? Who has the motivation?
CIA
is my guess and I'm thinking that they are the new member to the PPT. They have the money and the motivation. I think that they came up with another one of their half-ass plans. They put big money to work, but they forgot about the speculators and hedge funds. These people see big money move the price of oil. They jump on the trend and the original push to the $70. to $85. range, now is well past breaking $50. per barrel. By the way many other commodities are hurting too. Iron ore is down 65%.
New Problems
Price action in oil suggests that there is no resistance to this trend all the way down to $32. per barrel. This will cause high losses for oil produces like Canada's oil sand's. In addition, all the small oil frackers that entered the market by utilizing the Fed's cheap money at low rates will be in serious trouble. They will lose money on every barrel that they sell unless they hedged their production. Those hedges are usually only one year in duration. So, by next May, defaults will begin. You see, dear reader, smaller oil firms had to get their finances from high risk bonds. At present, this is 15% of the segment of the high yield bonds. Banks are on the hook for another 23% of their loan portfolio. The idiots who manipulated the market did not take into account the consequences of their actions, which is usually the case. As my man Forest Gump would say, "Stupid is what stupid does."
Of course, there are winners here. The paid shills in the media will remind you daily that the consumer benefits. Some people say that the consumer will have $700 billion extra to spend. That sounds great except the Republicans will steal some of it through state and federal taxes on oil for infrastructure. Yes, I'm making that prediction. They will use the same shills to inform you that we will be able to fund money for roads, bridges and create jobs. The same old same old. Instead of spending $500 plus billons for war and the military every year, we could've rebuilt America a long time ago. The shills never mention that aspect of our budget and the military complex and influence.
There will be other winners too. European consumers along with the economies of Korea, India and Thailand will all benefit. However, there are other more serious losers.
Foreign Loans
Emerging nations took some of the Fed's cheap money too. They grabbed and grew until now. The global community is slowing and those loans were made in US dollars. Guess what? The US dollar is rising which makes the loans more expensive. It is like an adjustable mortgage and now, your pay rate is higher because your money is worth less through devaluation. Shortfalls in budgets will really hurt. Venezuela needs oil at $121. per barrel. Nigeria needs oil at $119. per barrel. Iraq needs oil at $106. per barrel.
Commodity driven economies get their money from oil. Venezuela gets 51%. Norway and Russia get 19%. The list is long. I think you get the point. Australia derives 5.7% of its GDP from commodities, and South Africa is in the same boat. This means trouble in River City. Defaults could spread unless there is rollovers to the loans. This looks very iffy at present. Together, all these financial pressures could trigger a derivative and once that happens, you will agree with me, End the Fed!
Thursday, January 1, 2015
FORECAST 2015
- Today came from yesterday and together forms the path to tomorrow
- JFL
Before I can look forward it is important to understand how yesterday led to today. In my forecast 2014 I had some misses and hits.
On the hit side I stated that the copycat world would continue to devalue currencies, seeking the export market niche. In addition, central banks have lowered interest rates to help achieve their currency targets. They realized that the US Fed QE and lower interest rates allowed the US government to function with its high debt load and allow its banks to recapitalize after the financial mess of 2008.
I swung and missed when the US Fed did not raise interest rates as they indicated that they would. This is a smoke screen that the new Fed chairperson, Yellin hopes to play again in 2015. Hitters will soon hit this curve ball to right for a hit. When enough of them get on base, the Fed will change their language to maintain control. The Fed will not raise interest rates in 2015 and if they do, it will be a joke at a quarter of a percent. They are trapped in a box. They do not know how to raise rates without damage to the stock market and then, the media of public opinion.
I missed on the call to see regional monikers emerge to be front and center as opposed to individual nations. Keep in mind, this is a slow transformation and the process takes time.
I had Russia right with opening an oil market to China and the East.
I missed on Obamacare. I said costs would explode the national debt, however prices have risen. The call could be correct down the road.
I correctly stated that gold would be under pressure, but I was vague about when the turn-around would occur.
I was wrong about the demographics call and no one foresaw the oil crash. Retail has received a stimulus due to the extra bucks from lower gas prices. On the flip side the global community is slowing, especially commodity driven economies. Taken together, all my hits, misses and overlooked will lead us into 2015. This is what I see:
For those among you, dear readers, that are only interested in investing ideas, I will provide a near-term market outlook. Keep in mind, many aspects affect corporate returns with the number one force on the list being currencies.
King Dollar
will sink corporate profits. You may or may not dismiss my blog posts, but compared to the "talking heads" on TV, at least, I'm honest.
Foreign profits account for the largest portion of corporate returns and the rising dollar will crush that side of the ledger. Domestic consumption may increase due to lower energy prices, but the product themselves are still outsourced. As the bottom line shrinks, so too will the stock market. I see a drop of 1800 points in the Dow. This will occur after the first quarter. The size and scope of this trend will also be effected by the incomes in emerging markets. Lower commodity prices will have a negative trickle down effect in those nations. In addition, currencies will be under duress.
Wish For
governments wanted a lower currency value to spur exports. Now, they will get it except the demand will also shrink and new problems will surface like reserves to buy dollars and support their currency. Deficits will destroy budgets and plans for the future.
All this negative pressure will hit gold and silver, however other dangers like default will soon give strength to precious metals. I see gold at $1350 by April, but at that point the powers-to-be will attempt to regain control. We will have to wait and see what they do at that time. I would hope that citizens realize that a strong dollar improves their living standard and lowers the cost to food and energy, while the Fed seeks inflation which is contrary to our pursuit of happiness. With that said, I will offer my big picture with issues that will be in the news in 2015.
The first big issue will be the collapse of commodity prices. If they persist past the first quarter and there is no reason to stop this continuation of this trend, then the prospect of default will surface. The only rescue will be government protection in state economies and mergers or acquisitions in capital economies. Power hungry CEOs will oppose M & As to the point of default. These issues are slow to react and slow to resolve.
Hacking
I stated this in my 2013 call, but I didn't repeat it last year. The ill effects by government agencies, thieves and fools will continue and possibly cause a major event like a blackout or explosion in 2015.
Taxes
by the Republicans on gas will be debated and passed because infrastructure needs it and of course, the old stand-by that jobs will be created and our deficits lowered. At the same time they will argue for more money for the military. We are led by crooks and fools.
Obama
will attempt to revive his Pacific trade deal. This is a same old, same old approach that caused our economy and standard of living to decline due to the lower priced imports which destroys our industries and jobs.
EU
will suffer a recession, but I can't say how long and deep it will last. The EU will offer the answer of QE. Yep, this will add debt just like Japan and the US. Germany is key and because it relies so much on exports, it will be open to try anything. This will keep the trend of lower values for the euro which will put pressure on all members. Members will debate the pros and cons of staying with the euro. Greece will need money again and demographics will come forefront, especially with retirement and pensions.
SA
Argentina will have debt problems and Brazil social unrest. There will be sporadic news from Venezuela, Peru and Ecuador, but none of it good.
Asia
will have one bad moment after another. Thailand will have unrest. Japan a recession. China won't have an answer for global slowing and faces a real estate bubble.
Middle East
will have another up-rising and the continuation of displaced citizens will cause hardship for economies.
History and "15"
it has a funny way of repeating. Maybe because people have the same needs and wants and are led with decisions that reflect those issues. I could recount a historical litany of events in years with the fifteen ending, but I will give the first and skip to closer times. One theme is common: war.
In 115, The Jews revolted from Rome for the second time and it did not end well.
In 1715 the Ottoman Empire retook the Peloponnese peninsula. Spain lost its treasure fleet in the Caribbean. The Swedes occupy Norway.
In 1815 there were a lot of treaties signed, but no one kept their word. The Scots revolted from England. Didn't work out or the re-vote in 2014. Napoleon escaped from Elba which led to Waterloo which led to more treaties which led to more wars. One bright note, Andrew Jackson, a general without credentials, kicked the British out of New Orleans.
In 1915 Congress refused to give women the right to vote. US technology had the first coast-to-coast long distance phone call and Europe engaged in WWI. On a lighter note, the President of China, Yuan Shikai declared himself emperor.
Bottom line: if history repeats there will be unrest and conflicts which to me does not bode well for the stock market. I guess there will be trade deals, but no one will obide by the rules and possibly a new tech advance, however it could be in medicine, possibly Ebola? Sorry, for the dismal outlook, but history has a way like people of doing the same mistakes over and over again.
- JFL
Before I can look forward it is important to understand how yesterday led to today. In my forecast 2014 I had some misses and hits.
On the hit side I stated that the copycat world would continue to devalue currencies, seeking the export market niche. In addition, central banks have lowered interest rates to help achieve their currency targets. They realized that the US Fed QE and lower interest rates allowed the US government to function with its high debt load and allow its banks to recapitalize after the financial mess of 2008.
I swung and missed when the US Fed did not raise interest rates as they indicated that they would. This is a smoke screen that the new Fed chairperson, Yellin hopes to play again in 2015. Hitters will soon hit this curve ball to right for a hit. When enough of them get on base, the Fed will change their language to maintain control. The Fed will not raise interest rates in 2015 and if they do, it will be a joke at a quarter of a percent. They are trapped in a box. They do not know how to raise rates without damage to the stock market and then, the media of public opinion.
I missed on the call to see regional monikers emerge to be front and center as opposed to individual nations. Keep in mind, this is a slow transformation and the process takes time.
I had Russia right with opening an oil market to China and the East.
I missed on Obamacare. I said costs would explode the national debt, however prices have risen. The call could be correct down the road.
I correctly stated that gold would be under pressure, but I was vague about when the turn-around would occur.
I was wrong about the demographics call and no one foresaw the oil crash. Retail has received a stimulus due to the extra bucks from lower gas prices. On the flip side the global community is slowing, especially commodity driven economies. Taken together, all my hits, misses and overlooked will lead us into 2015. This is what I see:
For those among you, dear readers, that are only interested in investing ideas, I will provide a near-term market outlook. Keep in mind, many aspects affect corporate returns with the number one force on the list being currencies.
King Dollar
will sink corporate profits. You may or may not dismiss my blog posts, but compared to the "talking heads" on TV, at least, I'm honest.
Foreign profits account for the largest portion of corporate returns and the rising dollar will crush that side of the ledger. Domestic consumption may increase due to lower energy prices, but the product themselves are still outsourced. As the bottom line shrinks, so too will the stock market. I see a drop of 1800 points in the Dow. This will occur after the first quarter. The size and scope of this trend will also be effected by the incomes in emerging markets. Lower commodity prices will have a negative trickle down effect in those nations. In addition, currencies will be under duress.
Wish For
governments wanted a lower currency value to spur exports. Now, they will get it except the demand will also shrink and new problems will surface like reserves to buy dollars and support their currency. Deficits will destroy budgets and plans for the future.
All this negative pressure will hit gold and silver, however other dangers like default will soon give strength to precious metals. I see gold at $1350 by April, but at that point the powers-to-be will attempt to regain control. We will have to wait and see what they do at that time. I would hope that citizens realize that a strong dollar improves their living standard and lowers the cost to food and energy, while the Fed seeks inflation which is contrary to our pursuit of happiness. With that said, I will offer my big picture with issues that will be in the news in 2015.
The first big issue will be the collapse of commodity prices. If they persist past the first quarter and there is no reason to stop this continuation of this trend, then the prospect of default will surface. The only rescue will be government protection in state economies and mergers or acquisitions in capital economies. Power hungry CEOs will oppose M & As to the point of default. These issues are slow to react and slow to resolve.
Hacking
I stated this in my 2013 call, but I didn't repeat it last year. The ill effects by government agencies, thieves and fools will continue and possibly cause a major event like a blackout or explosion in 2015.
Taxes
by the Republicans on gas will be debated and passed because infrastructure needs it and of course, the old stand-by that jobs will be created and our deficits lowered. At the same time they will argue for more money for the military. We are led by crooks and fools.
Obama
will attempt to revive his Pacific trade deal. This is a same old, same old approach that caused our economy and standard of living to decline due to the lower priced imports which destroys our industries and jobs.
EU
will suffer a recession, but I can't say how long and deep it will last. The EU will offer the answer of QE. Yep, this will add debt just like Japan and the US. Germany is key and because it relies so much on exports, it will be open to try anything. This will keep the trend of lower values for the euro which will put pressure on all members. Members will debate the pros and cons of staying with the euro. Greece will need money again and demographics will come forefront, especially with retirement and pensions.
SA
Argentina will have debt problems and Brazil social unrest. There will be sporadic news from Venezuela, Peru and Ecuador, but none of it good.
Asia
will have one bad moment after another. Thailand will have unrest. Japan a recession. China won't have an answer for global slowing and faces a real estate bubble.
Middle East
will have another up-rising and the continuation of displaced citizens will cause hardship for economies.
History and "15"
it has a funny way of repeating. Maybe because people have the same needs and wants and are led with decisions that reflect those issues. I could recount a historical litany of events in years with the fifteen ending, but I will give the first and skip to closer times. One theme is common: war.
In 115, The Jews revolted from Rome for the second time and it did not end well.
In 1715 the Ottoman Empire retook the Peloponnese peninsula. Spain lost its treasure fleet in the Caribbean. The Swedes occupy Norway.
In 1815 there were a lot of treaties signed, but no one kept their word. The Scots revolted from England. Didn't work out or the re-vote in 2014. Napoleon escaped from Elba which led to Waterloo which led to more treaties which led to more wars. One bright note, Andrew Jackson, a general without credentials, kicked the British out of New Orleans.
In 1915 Congress refused to give women the right to vote. US technology had the first coast-to-coast long distance phone call and Europe engaged in WWI. On a lighter note, the President of China, Yuan Shikai declared himself emperor.
Bottom line: if history repeats there will be unrest and conflicts which to me does not bode well for the stock market. I guess there will be trade deals, but no one will obide by the rules and possibly a new tech advance, however it could be in medicine, possibly Ebola? Sorry, for the dismal outlook, but history has a way like people of doing the same mistakes over and over again.
Thursday, December 18, 2014
Silver in 2015: You Asked Why
Silver use to be present in our currency, but as citizens became aware of the economic policies of our government and the Federal Reserve, it disappeared. You see, people began to horde dimes, quarters and half dollars for their silver content. Today, the old coins are called "junk" silver. In one aspect the government is glad that they are no longer present because they will remind all citizens in the value of money, especially related to our standard of living. For example, today a fifty-cent piece is worth one ounce of silver or around $16. bucks.
When you contemplate that aspect and consider an ounce of silver was worth over $40. bucks at one time, you realize that silver and precious metals are not going down in value, but up. I will not get into the philosophical debate of precious metals backing our currency for this piece. I believe by now, dear reader that you know where I stand. After all silver and gold is in our constitution not fiat worthless paper money.
Losing Battle
The powers to be run the show. They write the laws and they will rewrite the laws to make them look good and to give the appearance that everything is kosher and above board. There is no point to make because they will not give it a voice or present the view in a fair forum. With that said let us turn to silver in 2015.
Trade
do not horde. I still believe in holding precious metals, but one only has so much money. I'm working under that guideline. As stated in previous blogs, I favor Silver Wheaton mining company. They are a streaming company which means that they lent money to miners because banks won't and they receive silver and or gold in repayment for the loan. In addition, the company pays you a 1% dividend that you should use to accumulate more stock not cash. There are many other reasons for silver in 2015 and I will now state them.
Before I progress, let me digress. Silver and mining companies trade in a range. This is what I mean by trade. Buy your favorite at the low end of its range, wait and sell as it approaches the high end. Don't be greedy and hold for the low and top just be in the range and you can do this over and over again and have a good year in trading. The days of buy and hold are over. Like Rodney Dangerfield use to say, "Look out for number one, but don't step in number two."
Money
by that I mean fiat paper is still being printed above the GDP to the tune of 5-6% a year. This is devaluing of the currency. We have not seen it for two reasons. Every other nation is doing the same thing and QE is a digital mark on banks ledger. When it comes into play, inflation will show up in spades. By the way, speaking of the Fed and printing money, do you know what capital ratio means for a bank? It is the ratio of assets to debt. The Fed is down to 1.26%. If the value of the Fed's loans decrease by that amount, the Fed would be bankrupt. Of course, we know that this cannot happen because they will rewrite the laws and print more to cover their asses.
Switzerland
just rewrote its laws. They will now charge you to hold your money. It is not a tax only a fee. Yeah, right! The crooks got banks to charge you to hold your precious metals, back in the day, which is one reason why so few have some and now, they will put a fee on your deposits. One today, all tomorrow!
Basic Economics
the law of supply and demand will effect the price of silver in 2015. Miners have cut production due to low prices. With less production coupled with a rising demand, silver is golden. You can see this already in Canada, one of the world's leading resource nations. For the first nine months of 2013 Canadian producers had 510 million ounces and during the same period in 2014, down to 373 million ounces of silver. It is the same for South American, Australian, Mexican and Chinese producers. This is the supply side and you ask, what about the demand side?
U.S. Mint
had its best year in selling American Eagle coins. They sold a record 42.86 million ounces. Demand has returned in India and two other classifications.
Industrial
use for silver will grow at 5-7% in 2015. I see a big future demand with water purification and jewelry will add another 3-4% which only adds to the price because supply will decline with the miners cutbacks in production.
There is one other aspect and that is the buying of gold by central banks. China leads the parade, and then there is Russia. Even though the ruble is down 45% to the dollar, it does has some value as 6.2% of the fiat ruble is backed by gold. I mention this because there has always been a ratio of gold to silver. From 1970 until recently, the ratio has been 55 to 1 and today, it is 73 to one. There is a big upside just to close the historical ratio, especially when both were currencies the ratio was 16 to one. Keep this in mind, a stock like Silver Wheaton does not cost you anything to hold. It is secure with the broker and it pays you a dividend. Case closed as to the latest fee orientated banking industry.
Resistance
silver has a top resistance at $22. per ounce, but if it breaks through, it goes to $33. non-stop. Watch the volume and price spread at that point because this story has a silver lining.
When you contemplate that aspect and consider an ounce of silver was worth over $40. bucks at one time, you realize that silver and precious metals are not going down in value, but up. I will not get into the philosophical debate of precious metals backing our currency for this piece. I believe by now, dear reader that you know where I stand. After all silver and gold is in our constitution not fiat worthless paper money.
Losing Battle
The powers to be run the show. They write the laws and they will rewrite the laws to make them look good and to give the appearance that everything is kosher and above board. There is no point to make because they will not give it a voice or present the view in a fair forum. With that said let us turn to silver in 2015.
Trade
do not horde. I still believe in holding precious metals, but one only has so much money. I'm working under that guideline. As stated in previous blogs, I favor Silver Wheaton mining company. They are a streaming company which means that they lent money to miners because banks won't and they receive silver and or gold in repayment for the loan. In addition, the company pays you a 1% dividend that you should use to accumulate more stock not cash. There are many other reasons for silver in 2015 and I will now state them.
Before I progress, let me digress. Silver and mining companies trade in a range. This is what I mean by trade. Buy your favorite at the low end of its range, wait and sell as it approaches the high end. Don't be greedy and hold for the low and top just be in the range and you can do this over and over again and have a good year in trading. The days of buy and hold are over. Like Rodney Dangerfield use to say, "Look out for number one, but don't step in number two."
Money
by that I mean fiat paper is still being printed above the GDP to the tune of 5-6% a year. This is devaluing of the currency. We have not seen it for two reasons. Every other nation is doing the same thing and QE is a digital mark on banks ledger. When it comes into play, inflation will show up in spades. By the way, speaking of the Fed and printing money, do you know what capital ratio means for a bank? It is the ratio of assets to debt. The Fed is down to 1.26%. If the value of the Fed's loans decrease by that amount, the Fed would be bankrupt. Of course, we know that this cannot happen because they will rewrite the laws and print more to cover their asses.
Switzerland
just rewrote its laws. They will now charge you to hold your money. It is not a tax only a fee. Yeah, right! The crooks got banks to charge you to hold your precious metals, back in the day, which is one reason why so few have some and now, they will put a fee on your deposits. One today, all tomorrow!
Basic Economics
the law of supply and demand will effect the price of silver in 2015. Miners have cut production due to low prices. With less production coupled with a rising demand, silver is golden. You can see this already in Canada, one of the world's leading resource nations. For the first nine months of 2013 Canadian producers had 510 million ounces and during the same period in 2014, down to 373 million ounces of silver. It is the same for South American, Australian, Mexican and Chinese producers. This is the supply side and you ask, what about the demand side?
U.S. Mint
had its best year in selling American Eagle coins. They sold a record 42.86 million ounces. Demand has returned in India and two other classifications.
Industrial
use for silver will grow at 5-7% in 2015. I see a big future demand with water purification and jewelry will add another 3-4% which only adds to the price because supply will decline with the miners cutbacks in production.
There is one other aspect and that is the buying of gold by central banks. China leads the parade, and then there is Russia. Even though the ruble is down 45% to the dollar, it does has some value as 6.2% of the fiat ruble is backed by gold. I mention this because there has always been a ratio of gold to silver. From 1970 until recently, the ratio has been 55 to 1 and today, it is 73 to one. There is a big upside just to close the historical ratio, especially when both were currencies the ratio was 16 to one. Keep this in mind, a stock like Silver Wheaton does not cost you anything to hold. It is secure with the broker and it pays you a dividend. Case closed as to the latest fee orientated banking industry.
Resistance
silver has a top resistance at $22. per ounce, but if it breaks through, it goes to $33. non-stop. Watch the volume and price spread at that point because this story has a silver lining.
Thursday, December 11, 2014
Next Crisis: Oil and Subprime=Derivatives
JP Morgan, Morgan Stanley, heck, all of Wall Street have a new game to get their newest yacht. They are targeting high-end net worth individuals. They are offering them paperless loans and then, they are bundling these loans into security swaps. Sound familiar? That's right! They are substituting housing for securities, bonds or both in this new scheme. This easy loan is made because Wall St. already has the security, bonds or other assets in house. No paperwork. Take the money! Let's both go down to the boat dealer and buy a yacht. The market? Don't worry, it always goes up.
Don't Cry For Me, Rich Man!
Yeah, the Argentine revival show will end up crying on the ears of lobbyists and then, Congress. The spin will go something like this, "Something must be done for our rich folks who provide for so many with low paying jobs like cleaning, driving and baby sitting."
What about
Dodd-Frank?
It never was in reality. Just like the "deal" yesterday in Congress, it gets weaker and weaker to the point that it never was more than an abstract thought to placate the masses. So, subprime is back in business behind the scenes until it isn't. At that moment it will be a problem. As for you wealthy out there, get it while you can. You know the Fed has your back. So, step up to
Private Client Banking
a separate section in banks just for you. In a hurry? Then, apply for Morgan Stanley's,
Express Credit Line.
If the above was all the bad news you could take, close the site, come back to it after a break. The other problem has already showed itself and it is a doozy.
OIL
The price of the commodity as you all know whether you drive or just sit in the car, has been coming down. How low is it? It is so low that the Bird of Paradise was seen in a jacket because it was that cold. It is down by 40% this year! Before I get into the ramifications of low oil to the economy, it is important to realize that other commodities like iron ore, materials, gold and silver are all down too. Iron ore is at a five year low and JP Morgan now says, it could fall to $67. a tonne in 2015. You and me don't follow things like this, but we can understand the implications. In January JP Morgan said
the price would be $87. a tonne. Dr. Copper is below $3. a tonne and this is a dollar below forecast. These deflationary prices reflect a slowing global economy and keep this in mind. In late 2007 oil began to fall and it predicted the crisis of 2008. There are other signs too.
Japan
is in recession and it is deeper than previously thought. Half the members of the EU are in recession and the other half is gaining on the losers. China's demand for materials is falling. Russia's ruble is down 40% which will cause pain to its citizens and its central bank indicated a recession in 2015. Brazil and other emerging nations have internal problems with strikes and national protests, not to mention our own Ferguson, "Don't shoot!" story. Finally, the Baltic Shipping Index is down 500 points since last month. Global transactions are falling off the cliff.
Back To Oil
Do you know what "capital expenditure" means? It is money that companies plan to spend in an up coming year to increase quantity, get new equipment or put on a new roof. Since I'm referring to oil, all my example center on oil.
The oil giant, Conoco-Phillips started the process with low oil prices by cutting back its capital expenditure program for 2015. They cut 20%. Others will follow and it is already showing in oil drill permits which were down 40% in November. Keep this in perspective: The oil industry supports 9.3 million people with high paying jobs. It adds $1.9T to the GDP each year. Since 2007, 1.36 million jobs were gained in oil states, whereas 420,000 jobs were lost in non-oil states. In addition, oil accounts for 20% of junk bonds to fund their business. At present junk bonds are falling rapidly as investors are selling. They see this problem on the horizon. Too much supply not enough demand.
Corporate Debt
Now, all these junk bonds for smaller fracking companies like Continental Resources are putting these loans in jeopardy. Continental only had a debt balance of $140 million in 2005, however they expanded quickly. They now owe $6T in debt with lower prices for their product which is 43x the debt level of 2005. The oil industry has $200B in high yield debt and another $300B in loans. If one fails, it will effect a lender who should have the loan tied to an insurance derivative to which will effect more than one insurer and more than one loan. We've all seen a domino falling commercial except this will be real life. Why, you ask? Because Morgan Stanley now sees oil at $43. a barrel for 2015. This is less than half its previous estimate. At that price level more than half of the energy companies will lose money on every barrel sold. The "Don't Cry For Me..." song will be played many times in 2015. I have warned you, dear reader before about the dangers of derivatives. This could trigger the event.
P.S.: Argentina is in serious trouble with its currency too, but the lobbyists will sing to Congress while the Fed's, Yellin will perform for the media. Hopefully, a new song with the meme of "End the Fed" will resound throughout the land.
Don't Cry For Me, Rich Man!
Yeah, the Argentine revival show will end up crying on the ears of lobbyists and then, Congress. The spin will go something like this, "Something must be done for our rich folks who provide for so many with low paying jobs like cleaning, driving and baby sitting."
What about
Dodd-Frank?
It never was in reality. Just like the "deal" yesterday in Congress, it gets weaker and weaker to the point that it never was more than an abstract thought to placate the masses. So, subprime is back in business behind the scenes until it isn't. At that moment it will be a problem. As for you wealthy out there, get it while you can. You know the Fed has your back. So, step up to
Private Client Banking
a separate section in banks just for you. In a hurry? Then, apply for Morgan Stanley's,
Express Credit Line.
If the above was all the bad news you could take, close the site, come back to it after a break. The other problem has already showed itself and it is a doozy.
OIL
The price of the commodity as you all know whether you drive or just sit in the car, has been coming down. How low is it? It is so low that the Bird of Paradise was seen in a jacket because it was that cold. It is down by 40% this year! Before I get into the ramifications of low oil to the economy, it is important to realize that other commodities like iron ore, materials, gold and silver are all down too. Iron ore is at a five year low and JP Morgan now says, it could fall to $67. a tonne in 2015. You and me don't follow things like this, but we can understand the implications. In January JP Morgan said
the price would be $87. a tonne. Dr. Copper is below $3. a tonne and this is a dollar below forecast. These deflationary prices reflect a slowing global economy and keep this in mind. In late 2007 oil began to fall and it predicted the crisis of 2008. There are other signs too.
Japan
is in recession and it is deeper than previously thought. Half the members of the EU are in recession and the other half is gaining on the losers. China's demand for materials is falling. Russia's ruble is down 40% which will cause pain to its citizens and its central bank indicated a recession in 2015. Brazil and other emerging nations have internal problems with strikes and national protests, not to mention our own Ferguson, "Don't shoot!" story. Finally, the Baltic Shipping Index is down 500 points since last month. Global transactions are falling off the cliff.
Back To Oil
Do you know what "capital expenditure" means? It is money that companies plan to spend in an up coming year to increase quantity, get new equipment or put on a new roof. Since I'm referring to oil, all my example center on oil.
The oil giant, Conoco-Phillips started the process with low oil prices by cutting back its capital expenditure program for 2015. They cut 20%. Others will follow and it is already showing in oil drill permits which were down 40% in November. Keep this in perspective: The oil industry supports 9.3 million people with high paying jobs. It adds $1.9T to the GDP each year. Since 2007, 1.36 million jobs were gained in oil states, whereas 420,000 jobs were lost in non-oil states. In addition, oil accounts for 20% of junk bonds to fund their business. At present junk bonds are falling rapidly as investors are selling. They see this problem on the horizon. Too much supply not enough demand.
Corporate Debt
Now, all these junk bonds for smaller fracking companies like Continental Resources are putting these loans in jeopardy. Continental only had a debt balance of $140 million in 2005, however they expanded quickly. They now owe $6T in debt with lower prices for their product which is 43x the debt level of 2005. The oil industry has $200B in high yield debt and another $300B in loans. If one fails, it will effect a lender who should have the loan tied to an insurance derivative to which will effect more than one insurer and more than one loan. We've all seen a domino falling commercial except this will be real life. Why, you ask? Because Morgan Stanley now sees oil at $43. a barrel for 2015. This is less than half its previous estimate. At that price level more than half of the energy companies will lose money on every barrel sold. The "Don't Cry For Me..." song will be played many times in 2015. I have warned you, dear reader before about the dangers of derivatives. This could trigger the event.
P.S.: Argentina is in serious trouble with its currency too, but the lobbyists will sing to Congress while the Fed's, Yellin will perform for the media. Hopefully, a new song with the meme of "End the Fed" will resound throughout the land.
Thursday, December 4, 2014
Market Alert: Buy Gold Now
It is rare that I post a buy or sell recommendation, however many indicators point to a near-term buy in gold or silver. Hey, you can cover your Christmas presents. This is a short window of opportunity. Gold will hit resistance at $1229. It is now around $1215. This signal came from the Swiss referendum that failed. Gold sank to $1240 area, but a strong rebound put it back over the $1200. level with volume on contracts. Dear reader, I'm a believer in volume. If you see a sale and the store is bursting at the seams, maybe you should investigate. If on the other hand, you see a sale and no one is buying, maybe there is a reason. Investigate the reason. This is what I did.
Indicators
From the technical viewpoint as stated the buying in gold had a strong resolution. This is very good. Gold itself has resistance, and generally, the first attempt at resistance fails. This is the time to accumulate shares in companies like Gold Corp or a gold miner index. I brought shares in Silver Wheaton. Place a stop to protect profits or limit losses. If gold breaks through resistance, the next point is $1325- $1350 area. You could make nice buck or two.
The above is from charts. The following is from fundamental aspects with a lot of "ifs" and "maybes."
The recent decline in oil has many side effects. You see there are many shale oil companies. These are smaller entities that cannot secure funding from standard institutions. They get their drill money from junk bonds. They pay more interest and now, the value of their product is putting a squeeze on them. The total junk bond exposure is 20% of the market for these oil loans. Maybe someone is in trouble?
The ECU had discussed QE aspects. Now, they have put this discussion off until 2015. Maybe someone like Germany opposes the idea.
The Japanese yen is at 119 and heading for 120 as predicted in an earlier blog. The continuation of currency wars with the declining value of fiat money only allows the shine in gold to show forth.
Russia has started a verbal war with the West and another internal war with its own central bank. One leading politician called their central bank, "An enemy of the people!" The ruble has lost 40% of its value and a chain reaction to bonds is causing under the surface problems. Maybe something bad will be exposed?
In the US the Fed has stopped their QE program. They said that they will soon raise interest rates, however they keep changing the guidelines for the day that this will occur. They will have to put up or shut up. Maybe they will lose face as they say in Japan?
In China they have reduced interest rates after the slowdown to their economy. Funny, the reported GDP is always over 7%,and yet, we know those figures are fake. China has a building bubble and maybe something is popping?
India had a change of heart about gold. They ended their restrictions on it. This will cause more buying in gold.
Finally, the leasing rate for gold has fallen so low that it is being offered at give away levels. Many banks and companies use this as an asset to bolster their account balances. This rarely happens. When it occurs, a rally in gold follows.
If these and other aspects continue, gold will benefit. This could be the push that gets gold back to $1350 and a nice Christmas present to you. Peace and good luck!
Indicators
From the technical viewpoint as stated the buying in gold had a strong resolution. This is very good. Gold itself has resistance, and generally, the first attempt at resistance fails. This is the time to accumulate shares in companies like Gold Corp or a gold miner index. I brought shares in Silver Wheaton. Place a stop to protect profits or limit losses. If gold breaks through resistance, the next point is $1325- $1350 area. You could make nice buck or two.
The above is from charts. The following is from fundamental aspects with a lot of "ifs" and "maybes."
The recent decline in oil has many side effects. You see there are many shale oil companies. These are smaller entities that cannot secure funding from standard institutions. They get their drill money from junk bonds. They pay more interest and now, the value of their product is putting a squeeze on them. The total junk bond exposure is 20% of the market for these oil loans. Maybe someone is in trouble?
The ECU had discussed QE aspects. Now, they have put this discussion off until 2015. Maybe someone like Germany opposes the idea.
The Japanese yen is at 119 and heading for 120 as predicted in an earlier blog. The continuation of currency wars with the declining value of fiat money only allows the shine in gold to show forth.
Russia has started a verbal war with the West and another internal war with its own central bank. One leading politician called their central bank, "An enemy of the people!" The ruble has lost 40% of its value and a chain reaction to bonds is causing under the surface problems. Maybe something bad will be exposed?
In the US the Fed has stopped their QE program. They said that they will soon raise interest rates, however they keep changing the guidelines for the day that this will occur. They will have to put up or shut up. Maybe they will lose face as they say in Japan?
In China they have reduced interest rates after the slowdown to their economy. Funny, the reported GDP is always over 7%,and yet, we know those figures are fake. China has a building bubble and maybe something is popping?
India had a change of heart about gold. They ended their restrictions on it. This will cause more buying in gold.
Finally, the leasing rate for gold has fallen so low that it is being offered at give away levels. Many banks and companies use this as an asset to bolster their account balances. This rarely happens. When it occurs, a rally in gold follows.
If these and other aspects continue, gold will benefit. This could be the push that gets gold back to $1350 and a nice Christmas present to you. Peace and good luck!
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