The Inflation Scare
Interest rates backed up last week. The 30-year T-Bond, which was 1.19% on August 4, closed at 1.44% on Friday (August 14). The 10-year T-Note closed at 0.71%. It was 0.52% on August 4. The CPI showed up with a +0.6% M/M rise (7.4% annual rate) for July. That pushed the Y/Y rate to +1.0% […]
The Opposite: The Market Takes A Cue From Seinfeld
The Opposite In one of the 1990s Seinfeld episodes known as “The Opposite,” George Costanza decides to make decisions opposite of what his “normal” instincts would tell him to do. The results of his “opposite” actions were a beautiful girlfriend, a standing ovation, and a job with the N.Y. Yankees! Today’s equity market seems to be behaving […]
With GDP at 2.3 percent and gold prices low, should you buy?
The data on the economy has been mixed of late, and the price of gold has tanked again. In what follows, I try to analyze these trends. The U.S. Economy U.S. GDP growth of 2.3 percent in the second quarter appears, at first glance, disappointing. But given the very significant headwinds in the manufacturing sector […]
More on Market Volatility
Despite the fact that the U.S. economy appears to be on solid ground, the equity markets appear confused and uncertain, and have exhibited volatility, including huge intraday point swings. In what follows, I will examine the sources of the uncertainty and try to shed light on whether or not to worry. 1. Global Economic […]
What’s the Safest Way to Hedge Against Inflation With Gold?
Until inflation becomes recognized, the investor holding gold as a hedge must have both patience and the ability to hold for an extended period. Historically, the price of gold protected the purchasing power of the currency invested in it, as the price rose in some reasonable correlation with existing or expected inflation of that […]
Why Gold Prices Dropped in 2013
Most seasoned investors have some allocation to precious metals in their portfolios, most often gold. They believe that such an allocation protects them, as it is a hedge, or an insurance policy, against the proliferation of paper (fiat) money by the world’s largest central banks. Fiat money is not backed by real physical assets. In […]