Gold does not necessarily rise and fall with interest rates, jewelry demand in India, or any other widely believed nonsense. Rather, gold has moved in conjunction with perceptions as to whether or not the Fed and central banks have everything under control.
Between China's housing minister admitting the local real estate market is in a bubble, and China planning to implement property taxes, what has until recently been a trickle of selling will likely turn into a flood soon, and is the reason why Axiom's Gordon Johnson is warning to sell steel and iron ore immediately.
"When I was Chair of the Federal Reserve I used to testify before US Congressman Ron Paul... we had some interesting discussions... We would never have reached this position of extreme indebtedness were we on the gold standard, because the gold standard is a way of ensuring that fiscal policy never gets out of line."
When the history of these times is written, former Fed Chair Alan Greenspan will be one of the major villains, but also one of the greatest mysteries. This is so because he has, in effect, been three different people.
When historians look back on this period of the last forty years and diagnose what went wrong, they might do worse than to conclude that at the root of it was a general failure of character, from the top down.
For 60 years the labor force participation rate of 25-54 year old men in America has declined. There are many reasons for this existential decline, but Philly Federal Reserve President Pat Harker explained today during a Q&A session that he is concerned that more 25-54 year old men are out of the workforce and blamed "drug abuse" for the problem. Of course, this is not the first time Fed officials have claimed 'drug abuse' as an excuse for the failure of their policies.
Vancouver’s multimillion-dollar homes are not only out of reach for most Vancouverites, they are rapidly becoming a self-contained ghost town, because nothing speaks to the Canadian city’s affordability crisis more than its empty houses acquired by "hot money" laundering Chinese: as of the end of 2016, the number of Vacant or temporarily occupied houses more than doubled since 2001 to a whopping 66,719.
In the latest tightening in China's financial conditions, the China Securities Journal reports that some bank branches in Beijing, Guangzhou and Chongqing have raised mortgage rates for first-home buyers recently.
Donald Trump will face his moment, like it or not. Barack Obama faced it and decided to kick the can down the road and opt for yet more “stimulus.” How Trump deals with it will determine whether or not the US economy recovers from bad policies, or goes the way of Japan and Europe.
The central bank on Friday increased the interest rates on reverse repo by 10bp - the last time the PBOC raised OMO rates was more than two years ago in 2014. The PBOC also increased SLF rates, in what some have dubbed "the Most Important Unnoticed Global Event."
This time last year, Vancouver was one of world’s hottest housing markets as buyers turned up throughout the winter for bidding wars and sales reached an all-time high. Now, things have changed as the Chinese hot money bubble has shifted to Toronto.