The World Financial Report

World Financial Report – November 15th, 2018

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WORLD FINANCIAL REPORT ON RADIO NOVEMBER 15TH 2018
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CHARTS OF THE WEEK-QUOTES-QUICK HITS

-CHART OF THE WEEK: What’s Behind the Slump in the Oil Price? 85% Weak Demand. Brent crude had lost $21 a barrel at Tuesday’s close from its high this year on Oct. 3. What’s driving it? Bloomberg Economics estimates weaker demand accounts for $18 of the decline, the rest is supply. The support to global economic growth from cheaper oil is likely to be small because demand-led shocks have a different impact on the world economy from supply-led shocks. Bloomberg

-CHART OF THE WEEK: Crude’s Collapse Is Sending Shockwaves Across Global Markets. Investors have gone from contemplating the prospect of oil at $100 to sub-$50 in less than two months. No wonder global markets are playing catch-up. From stocks and bonds to currencies, assets worldwide are gripped by a crude awakening. Monday saw oil’s largest one-day drop in three years, securing its longest losing streak on record. Early trading jitters on Wednesday suggested the sell-off may not be over, though West Texas Intermediate later climbed after OPEC President Suhail Al Mazrouei said the group and its allies would do what is needed to balance the market. Bloomberg

-CHART OF THE WEEK: Apple’s Longest Sell-Off Since April Has Cost Investors $107 Billion. Apple Inc. is headed for its longest losing streak in more than six months as investors reassess the company’s growth prospects amid declining expectations for iPhone sales. The shares fell 2.5 percent at 1:36 p.m. in New York, extending a five-day slump that would be Apple’s longest losing streak since late April. The stock has fallen 11 percent over the rout, erasing about $107 billion in market value. Apple’s year to date gain is now just 11 percent, down from almost 40 percent in early October.

Investors are grappling with reduced sales expectations this week after several iPhone suppliers unexpectedly cut revenue forecasts. The developments prompted Guggenheim to downgrade its rating on Apple on Wednesday to the equivalent of hold. The company’s reliance on higher-average selling prices for the devices are “no longer enough” to support revenue growth expectations, the firm said. Bloomberg

-Authorities searching through the blackened aftermath of California’s deadliest wildfire have released the names of about 100 people who are missing, including many in their 80s and 90s, and dozens more could still be unaccounted for. As the names were made public, additional crews joined the search, and the statewide death toll climbed Wednesday to at least 51, with 48 dead in Northern California and three fatalities in Southern California. “We want to be able to cover as much ground as quickly as we possibly can,” Butte County Sheriff Kory Honea said. “This is a very difficult task.” Read more here-http://bit.ly/2DCWEzp

-Renowned energy trader Mark Fisher on Wednesday said the “worst is over” for the crude oil market following a six-week rout that has seen U.S. crude lose over a quarter of its value. The MBF Clearing founder and CEO said he’d be a buyer right now rather than a seller. The market outlook for crude oil has recently flipped. Investors were worried about a shortage of oil as U.S. sanctions shrank Iran’s crude exports. But the market now expects supply to outstrip demand as the outlook for consumption growth weakens and Washington allows some Iranian crude shipments to continue.

However, Fisher theorized that much of the drop in oil prices is due to macro funds getting out of the crude trade and rotating into natural gas futures. He argued that for years, buying oil and selling natural gas has been a huge winner. “In no short period of time this trade has imploded,” he said. “And I’m sure there is a ton of people getting, you know, margin called out of this trade, where they’re being forced to buy nat gas and sell crude oil, and that’s added to this new debacle.” CNBC

-Brent crude is going back to $75 after likely OPEC supply cut, Goldman commodities chief says. Goldman Sachs’ Jeff Currie says Brent crude will bounce back and average $75 a barrel in the first quarter of 2019. Oil prices have tumbled more than 25 percent over the last six weeks, plunging the energy complex into a bear market. Currie says investor positioning and one particular trading strategy are largely responsible for deepening the oil price rout in recent days. CNBC

-Canada’s oil sector is divided over whether to force a temporary cut to production, with some major producers pushing the controversial idea in a bid to ease a supply glut and halt a steep plunge in prices, according to seven people familiar with the matter. Executives from Canadian Natural Resources Ltd. and Nexen Energy ULC are among those who made the pitch to Alberta’s premier last month, the people said, speaking on condition of anonymity as the meeting was private. Cenovus Energy Inc. is also publicly advocating for a forced cut.

The producers called on Rachel Notley to invoke a provincial government power to force “curtailment,” the people said, at a time when Canadian heavy crude is selling for a near-record discount from U.S. benchmark prices, costing Alberta billions. Some called for a temporary 10 percent cut, or about 380,000 barrels per day, until the market stabilizes, the people said. But the push is opposed by Suncor Energy Inc.; ExxonMobil Corp.‘s Canadian unit, Imperial Oil Ltd.; and Husky Energy Inc., the people say. Each has integrated operations, from production to refineries, that cushion the blow and therefore want to let the market sort out the oversupply issue. Notley’s government has publicly lowered expectations for intervention.

She emerged from the meeting calling for the purchase of more oil-hauling rail cars, but didn’t advocate curtailment. The unusual standoff reflects the dire straits most producers are in. “At the price that Albertans are getting for their oil, no one is making any money whatsoever in the upstream industry. At the same time, number of producers who are integrated with refineries are making windfall profits,” Cenovus Chief Executive Officer Alex Pourbaix told BNN Bloomberg television Wednesday, declining to name names. Bloomberg

-U.S. government posts $100 billion deficit in October. The U.S. federal government ran a $100 billion deficit in October, the first month of the new fiscal year, according to data released on Tuesday by the Treasury Department. The deficit was in line with analysts’ expectations. The Treasury said federal spending rose 18 percent from the year-earlier month to $353 billion in October, while receipts were up 7 percent to $253 billion. When accounting for calendar differences, the government ran a deficit of $110 billion last month compared with $111 billion in October 2017. Reuters

-Debt ceiling will be set to record high of $22 trillion, fund government to just summer. The federal government is set to reinstate its borrowing limit, and a new analysis indicates that it will be a record-high $22 trillion and then, it won’t provide enough money to fund the government past summer. The shocking number, however, is only slightly higher than the current actual debt of some $21 trillion. The ceiling has been in suspension and the debt has grown under President Trump. It is set to be reinstated on March 2, 2019. A new Bipartisan Policy Center estimate suggests that the new limit will be $22 trillion, assuming no action is taken by lawmakers before that time.

The BPC analysis said: “Treasury will be able to fully fund the government until at least mid-summer 2019 by using extraordinary measures, cash-on-hand, and incoming cash flow. But costs to taxpayers will start earlier from factors associated with reaching the debt limit such as higher interest rates on U.S. Treasury securities.” The analysis warned of troubles with the growing debt. “Our long-term debt path is reckless and potentially dangerous for the future of our economy, but the debt limit in its current form carries unacceptable costs and risks,” Shai Akabas, economic policy director at BPC, said. “It’s also proven to be an unsuccessful playbook for debt reduction. The American people have seen this movie before, and we should demand a different ending.” Read more here-https://washex.am/2zRRvPE

-Feds Collect Record Taxes in October; Still Run $100B Deficit. The federal government collected record total tax revenues of $252,692,000,000 in October, the first month of fiscal 2019, according to the Monthly Treasury Statement released Tuesday. Despite the record tax collections, the government still ran a deficit of $100,491,000,000 for the month because it spent $353,183,000,000. This October’s record $252,692,000,000 in total tax collections was $11,414,590,000 more than the $241,277,410,000 (in constant October 2018 dollars) that the federal government collected in October 2017, which was the previous record for federal tax collections in October. CNBC

-The booming U.S. economy, jump started by the 2017 GOP tax cut, has created 878,000 more millionaires in just the last 12 months, according to an international wealth report from Credit Suisse. “The boom goes on,” cheers the Credit Suisse’s Global Wealth Report. “Looking at the number of millionaires, we see that there are 42.2 million millionaires worldwide, which is up 2.3 million over the previous 12 months. Our research indicates that the United States added 878,000 new millionaires representing around 40 percent of the global increase to its already sizable stock,” the bank said.

The report showed that U.S. wealth grew at 6.5 percent, higher than the world average of 4.6 percent, and has extended a pattern that started during former President Obama’s administration. “Another prominent feature of the world wealth outlook this year is the seemingly relentless rise in household wealth in the United States,” said the report. It tried to suggest that the Trump economy is too hot to continue, but conceded that there is no end in sight. Said the report:

“Total wealth and wealth per adult in the United States have grown every year since 2008, even when total global wealth suffered a reversal in 2014 and 2015. The United States has accounted for 40 percent of all increments to world wealth since 2008, and 58 percent of the rise since 2013. While not wishing to cast doubt on the ‘Trump Effect’ on financial markets, it seems inevitable that the uninterrupted spell of increasing wealth in the United States will come to an end at some time. Fortunately, there are signs that wealth inequality is no longer rising, which should mitigate the impact of any setback on the middle classes.” Read more here-https://washex.am/2B4UnKO

-How much money you actually take home from a $75,000 salary, depending on where you live. President Donald Trump’s tax law resulted in a bump in take-home pay for about 90% of Americans, according to the IRS. For people earning $75,000 a year, federal income and FICA taxes amount to $685 per pay period under the new tax law, down from $778. That means employees who make $75,000 got a $93 boost per bimonthly paycheck. Businessinsider.com

-Here’s the ‘dream salary’ Americans want and how much they actually get paid. In an ideal world, Americans would like to earn well above $100,000 a year. Specifically, men say their “dream salary” is $445,000, while women wish they could earn a more modest, but still substantial, $279,000 per year. That’s according to a 2018 survey from MidAmerica Nazarene University (MNU) of 2,000 Americans. In reality, even the typical American family earns only a fraction of that: The median household income in the U.S. is $61,372. And even during their peak earning years, the typical American with a BA isn’t making six figures: Compensation research firm PayScale found that the median salary for a college educated woman tops out at about $61,000, and for a man at just under $95,000. Here’s the full breakdown of how much full-time workers with a Bachelor’s degree earn at every age. PayScale surveyed 972,788 U.S. workers between July 2015 and July 2018. Read more here-https://cnb.cx/2QJjFn2

-Many baby boomers are headed for an uncertain retirement. These generation members hold less wealth, are deeper in debt and will face higher expenses than retirees a decade older than them, according to a new report by the Stanford Center on Longevity. Nearly one-third of baby boomers had no money saved in retirement plans in 2014, when they were on average 58 years old, according to the researchers. (They analyzed data at various ages using multiple nationally representative surveys.) Among boomers with positive balances, the median savings was around $200,000.

Experts have said people may need a nest egg of more than $1 million to carry them through a 30-year retirement. There are currently more than 70 million baby boomers the generation defined by people born between 1946 and 1964 in the United States, according to the Pew Research Center. That many people could exit the workforce unprepared, the researchers note, could have profound consequences for the well-being of these individuals and society. “Boomers who run out of funds towards the end of life will either fall back on children, who by then will be in their 50s and 60s, or the social safety network,” said Jialu Streeter, a research scientist at Stanford. Read more here-https://cnb.cx/2OJZELg

-Here’s how much workers in other countries need to retire. How much workers should have saved for retirement varies widely by country, according to new guidelines from Fidelity. Workers in Hong Kong are estimated to need the most, with a final “x factor” amount of 12x (or “times”) salary. (In comparison, U.S. workers need 10x). Financial advisors warn that you should use the numbers as general guidelines, not personal recommendations. Read more here-https://cnb.cx/2zRZcFw

-The Welfare Generation: 51.7% Kids in 2017 Lived in Households Getting Govt Assistance. The Census Bureau has released new data that strengthens the case for calling the current generation of American children “The Welfare Generation.” Among American residents under 18 years of age in 2017, according to the Census Bureau, 51.7 percent lived in households in which one or more persons received benefits from a means-tested government program. That was down slightly from the 52.1 percent of Americans under 18 in 2016 who lived in households receiving means-tested government assistance. (Also, because this new Census Bureau estimate is for 2017, it predates the significant economic and job growth the United States has seen in 2018). But in each of the last five years on record (2013 through 2017), according to the Census Bureau, at least 51 percent of Americans under 18 have lived in households receiving means-tested government assistance. Read more here-http://bit.ly/2zOAllG

-Billionaire Cohen Says Bear Market Coming Within Two Years. Billionaire hedge fund manager Steve Cohen said a bear market is coming within two years, adding to a chorus of voices who say the U.S. economy could falter by 2020. “We’re definitely late cycle, and so at some point we’re going to enter a bear market, and it’s going to happen in the next year and a half, maybe two,” Cohen said during a talk with MSD Capital’s Glenn Fuhrman at the 92nd Street Y in Manhattan on Tuesday night. “I don’t think the returns over the next two years are going to be very good,” he said. “If the market hangs in there, there’s just going to be marginal returns.”

The $3.2 trillion hedge fund industry lost 3 percent last month and is down about 1.7 percent this year as stock pickers to macro traders sputtered, according to Hedge Fund Research Inc. Cohen, who returned to the business earlier this year after a government ban on him managing capital for clients ended, described how it was easier to make money during the early decades of his business because of the bull market in stocks and less competition in the industry. Cohen, 62, started his former firm, SAC Capital Advisors, in 1992 and it averaged returns of about 30 percent annually. The hedge fund pleaded guilty to securities fraud in 2013 and paid a record fine as part of a U.S. crackdown on insider trading on Wall Street. Bloomberg

-After years of low, low prices, fed by near-zero interest rates in a convalescing economy, Americans are waking up to costlier consumer living. Everyday household staples like diapers, toothpaste, shampoo and dishwashing liquid not to mention soft drinks, cookies, chocolate, cat litter and autos have all started getting more expensive, a trend expected to continue early next year. Announced by companies during the most recent earnings season, these price hikes have typically ranged from two percent to 10 percent. They also stand in stark contrast to the usually unending sales and promotions from major retailers like Walmart and Amazon.

The higher prices aim to pad revenues for companies like Apple, which has just raised sticker prices for its new MacBook Air laptops and iPads by 20 percent and 25 percent. But for a growing number of businesses, they also represent a response to mounting transportation costs. A stronger US dollar is similarly cutting into foreign earnings while a tight labor supply is at last pushing up wages. US auto giant General Motors upped the average price of its SUVs, crossovers and pickups by $800, something the company ties to rising costs for steel and aluminum commodities on which President Donald Trump slapped steep new import duties this year. American manufacturers are now paying eight percent more for aluminum than they did a year ago and 38 percent more for steel as local producers increase their prices. Read more here-http://bit.ly/2QCxROC

-The Trump administration will hold off for now on imposing new tariffs on imported automobiles, according to two people familiar with the matter. Shares of Japanese car manufacturers jumped. It will also be good news for Germany where the economy shrunk for the first time since 2015 in the third quarter as the car industry there took a hit on the emissions scandal. China, the target of many of the White House’s tariff moves to date, will be able to handle the trade war just fine, according to a major European miner. Bloomberg

Alibaba’s annual Singles’ Day sales extravaganza raked in a record US$30.7 billion Sunday. BNNBloomberg

-New York state is kicking in more than $1.5 billion in taxpayer-funded incentives for getting half of Amazon’s second headquarters located in a section of Queens. The Seattle-based company made its long-awaited announcement Tuesday, saying Long Island City and Alexandria, Virginia, will each get 25,000 jobs. The online retailer also said it will open an operations hub in Nashville, creating 5,000 jobs. Amazon will also receive as-yet unspecified incentives from New York City. New York state’s incentives are nearly triple those of Virginia’s, while Tennessee’s are $102 million.

According to Amazon, the cost per job for New York taxpayers is $48,000, compared to $22,000 for Virginia and $13,000 for Tennessee. In a statement released by Amazon, Cuomo called the agreement “one of the largest, most competitive economic development investments in U.S. history.” New York City Council Speaker Corey Johnson issued a statement saying: “Amazon is one of the richest companies in the world. I also don’t understand why a company as rich as Amazon would need nearly $2 billion in public money for its expansion plans at a time when New York desperately needs money for affordable housing, transportation, infrastructure and education.” Read more here-http://bit.ly/2FvTtei

-Chinese President Xi Jinping’s mantra that homes should be for living in is falling on deaf ears, with tens of millions of apartments and houses standing empty across the country. Soon-to-be-published research will show roughly 22 percent of China’s urban housing stock is unoccupied, according to Professor Gan Li, who runs the main nationwide study. That adds up to more than 50 million empty homes, he said. The nightmare scenario for policy makers is that owners of unoccupied dwellings rush to sell if cracks start appearing in the property market, causing prices to spiral. The latest data, from a survey in 2017, also suggests Beijing’s efforts to curb property speculation considered by leaders a key threat to financial and social stability are coming up short. “There’s no other single country with such a high vacancy rate,” said Gan, of Chengdu’s Southwestern University of Finance and Economics. “Should any crack emerge in the property market, the homes to be offloaded will hit China like a flood.” Bloomberg

-Bitcoin plummets under $6,000 to a new low for the year after months of stability. Bitcoin fell more than 7 percent Wednesday after a relatively calm few months. The cryptocurrency dropped to $5,640.36, hitting a new low for the year. Ethereum and XRP, the second and third largest cryptocurrencies behind bitcoin, dropped 13 percent and 15 percent respectively. CNBC

-The results are in, and a majority of Calgarians are saying “no thanks” to a potential bid for the 2026 Winter Olympics. The city conducted a non-binding plebiscite today to gauge public opinion on whether or not there is sufficient interest to submit a bid. Out of 767,734 eligible voters in Calgary, 56 per cent (171,750 of 304,774 total votes) said they don’t want the city to throw in its hat for the games. The plebiscite’s result is non-binding on city council, which has the final say on whether Calgary will proceed with a bid. The results won’t be declared official until Friday. Council is expected to address the results Monday. By comparison, 387,306 voted in the 2017 civic election for a 58.1 per cent turnout. Calgary was the host city of the 1988 Winter Olympics. Read more here-http://bit.ly/2Q0u3JO

-‘Facebook is the new cigarettes,’ says Salesforce CEO. In a wide-ranging interview, Salesforce CEO Marc Benioff compared using Facebook to nicotine addiction. “Facebook is the new cigarettes,” Benioff told journalist Kara Swisher for an MSNBC special, “Revolution: Salesforce Changing the World,” which will air on Sunday at 10 p.m. ET. “You know, it’s addictive. It’s not good for you. There’s people trying to get you to use it that even you don’t understand what’s going on. The government needs to step in. The government needs to really regulate what’s happening,” he said. Benioff is not known to shy away from clashes with fellow tech leaders. Most recently, he successfully advocated for San Francisco to pass Proposition C, a tax on the city’s biggest businesses meant to raise funds for the homeless. This put him in direct opposition to several of his peers, including Twitter and Square CEO Jack Dorsey, who argued the tax would disproportionately impact financial services companies like Square. CNBC

-Stan Lee, Force Behind Marvel Stable of Superheroes, Dies at 95. Stan Lee, who brought a modern sensibility to comic books and provided lucrative fodder for Hollywood as co-creator of such sympathetically imperfect superheroes as Spider-Man, the Incredible Hulk, X-Men and Iron Man, has died. He was 95. Lee died on Monday in Los Angeles, according to the Associated Press. From his start as a writer for Timely Comics in 1941, Lee rose to editor and publisher of Marvel Comics. He made his mark starting in the early 1960s by conjuring superheroes with troubled lives and temperamental personalities, a leap from the comic-book characters of the past. Bloomberg

-China scours social media, erases thousands of accounts. China’s top cyber authority has scrubbed 9,800 social media accounts of independent news providers deemed to have posted sensational, vulgar or politically harmful content on the Internet, it said late on Monday (Nov 12). China’s strict online censorship rules have tightened in recent years with new legislation to restrict media outlets, surveillance measures for media sites and rolling campaigns to remove content deemed unacceptable. The Cyberspace Administration of China (CAC) said in a statement that the campaign, launched on Oct 20, had erased the accounts for violations that included “spreading politically harmful information, maliciously falsifying (Chinese Communist) party history, slandering heroes and defaming the nation’s image.”

CAC also summoned social media giants, including Tencent’s Wechat and Sina-owned Weibo, warning them against failing to prevent “uncivilised growth” and “all kinds of chaos” among independent media on their platforms. “The chaos among self-media accounts has seriously trampled on the dignity of the law and damaged the interests of the masses,” CAC said.The term “self-media” is mostly used on Chinese social media to describe independent news accounts that produce original content but are not officially registered with the authorities. Read more here-http://bit.ly/2zRSsaw

-Patek Ref. 2499 Triumphs: Sotheby’s sells one for $3.9-million, Christie’s another for $3.2-million. The hero of the Geneva fall watch auctions was a rare Patek Philippe reference, two examples of which remarkably turned up in two sales a day apart this week in Geneva. A yellow gold Patek Philippe Ref. 2499 perpetual calendar chronograph sold at Sotheby’s on Tuesday for $3,915,000, the highest price paid for a watch at auction this year. A day earlier, Christie’s sold another yellow gold Ref. 2499 for $3,234,905. Read more here-http://bit.ly/2K5DmTo

-This week, a painting by the British artist David Hockney is set to displace Jeff Koons’s “Balloon Dog” as the most expensive work by a living artist to be sold at auction. “Portrait of an Artist (Pool with Two Figures)” will be sold at Christie’s Post-War and Contemporary Art Evening Sale on Thursday Nov 15th for an estimated $80 million, overtaking Koons’ 2013 record of $58.4 million. Read more here-http://bit.ly/2OIAmgr

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-Rio Tinto’s Argyle Pink Diamonds Tender delivers record results for pink, red and violet diamonds. Rio Tinto’s 2018 Argyle Pink Diamonds Tender collection of 63 rare pink, red and violet diamonds from its Argyle mine in Australia has delivered another record result reflecting strong global demand for fancy coloured diamonds. These results are also a reflection of Argyle approaching the end of its mine life, with the supply of these extremely rare diamonds becoming even scarcer. The 2018 collection of the finest pink, red and violet diamonds from the iconic Western Australian mine continued its trajectory of double-digit price growth.

Sold to an undisclosed buyer, Lot Number 1, the Argyle Muse™, a 2.28 carat Fancy Purplish Red diamond is the most valuable diamond in the Tender’s 34-year history. Amongst the record-breaking diamonds sold in the 2018 collection was Lot 2, the Argyle Alpha™, the largest and most valuable Vivid Pink diamond in the history of the Argyle Pink Diamonds Tender. The Argyle Alpha™ was won by Singapore based Argyle Pink Diamonds partner Glajz THG. Managing director John Glajz said “I am honoured to be custodian of this record-breaking gem, a diamond that embodies the rarity, beauty and provenance of Argyle pink diamonds.”

Over the past 18 years the value of Argyle pink diamonds sold at Tender have appreciated over 400 per cent, outperforming all major equity markets. Rio Tinto Copper & Diamonds chief executive Arnaud Soirat said “The 2018 Argyle Pink Diamonds Tender was highly sought after with record results that underscore the value of these gems in the history of rare coloured diamonds.” Matthew Aldridge, chief executive of Gemcut Geneva, a successful bidder on a number of diamonds in the 2018 Tender including Lot 5, the Argyle Odyssey™, a 2.08 carat Fancy Intense Pink diamond said “I have been bidding at the Argyle Pink Diamonds Tender since 1987 and continue to be amazed by the magnificent potency of colour of these unique diamonds from this extraordinary mine.

As an avid collector of the world’s finest fancy coloured diamonds I was especially delighted to win the Argyle Odyssey™, a match for another diamond that was sold in the Tender over fifteen years ago.” Almost the entire world supply of rare pink, red and violet diamonds come from Rio Tinto’s Argyle diamond mine in the remote east Kimberley region of Western Australia. Current estimates indicate sufficient economic reserves at the mine to support production through to the end of 2020. Read more here-http://bit.ly/2z6xh5a

-‘Incomparable’ $50-million pink diamond smashes record at Geneva auction. An exceptionally rare pink diamond of nearly 19 carats fetched 50.3 million Swiss francs ($50 million, 44 million euros) at auction in Geneva Tuesday, Christie’s said, setting a new per-carat record for a stone of its kind. The Pink Legacy, which once belonged to the Oppenheimer family who for decades ran the De Beers diamond-mining company, was snapped up by American luxury brand Harry Winston, part of the Swiss Swatch group. “$2.6 million per carat. That is a world record per carat for a pink diamond,” said Francois Curiel, head of Christie’s in Europe, of the price that included all fees and commissions. “This stone is for me the Leonardo da Vinci of diamonds.”

The 18.96-carat diamond was discovered in a South African mine around a century ago, Christie’s said. It was probably cut in the 1920s and has not been altered since. The stone was immediately rechristened the “Winston Pink Legacy” by its buyers. Christie’s international head of jewellery, Rahul Kadakia, described it as “one of the world’s greatest diamonds”. The rectangular-cut stone has been graded “fancy vivid” the highest possible grade of colour intensity as it has no trace of another hue like purple, orange or brown. Most pink diamonds weigh less than one carat and those in the top colour category with more than 10 carats are virtually unheard of at auction houses. The Pink Legacy is classed as Type IIa, meaning it is extremely chemically pure, a category only two percent of diamonds fall into.

“These are stones that have little if any trace of nitrogen,” said Kadakia, adding that this often gives Type IIa diamonds “exceptional transparency and brilliance”. “Imagine a domino that you have cut the corners off of,” Jean-Marc Lunel, an international jewellery specialist at Christie’s, recently told AFP, describing the stone’s unusual shape. He pointed out that the diamond has a “classical so-called emerald cut” standing out from the typical cuts used today, which are more rounded and multi-faceted. The classic rectangular cut is traditionally used for white stones, but is rare for pink diamonds. Christie’s said the Pink Legacy is “the largest and finest Fancy Vivid Pink diamond ever offered at auction by the company”, calling the stone “incomparable”.

“It is probably the most beautiful (specimen) ever presented at public auction,” Lunel said. Christie’s said only four vivid pink diamonds of over 10 carats have ever been offered at auction. One of them, the nearly 15-carat Pink Promise, was sold last November at a Christie’s auction in Hong Kong for $32.5 million. That amounts to $2.176 million per carat, which was previously the world auction record price per carat for any pink diamond. The Pink Legacy’s record-smashing price accounted for nearly half the takings at Tuesday’s auction, which saw total sales of more than $110 million, according to Christie’s spokeswoman Alexandra Kindermann. Read more here-http://bit.ly/2Q0Ya3U

Pink diamond sells for more than $50M. Christie’s sold the “Pink Legacy” diamond at auction Tuesday for more than $50 million including fees. Christie’s said that renowned jeweler Harry Winston was the buyer. The auction house had expected to fetch $30 million to $50 million for the nearly 19-carat, rectangular-cut stone, the largest fancy vivid pink diamond that it has ever put under the hammer. It was the standout offering at Christie’s fall jewelry auction in Geneva.

The standing-room only ballroom broke into applause after the auctioneer struck down a hammer price of $44.5 million. That excludes the standard “buyer’s premium” and other fees. The stone once belonged to the Oppenheimer diamond family, and Christie’s says it’s among the most chemically pure gems. Rahul Kadakia, Christie’s head of international jewelry, said that auction house has only sold four diamonds weighing more than 10 carats of the same color in its 251 years of history. Read more here-http://bit.ly/2Pr903W

Marie Antoinette pearl auctioned for record $36m. A pearl and diamond pendant that belonged to ill-fated French Queen Marie Antoinette has been sold for $36m (£28m) in what Sotheby’s auction house says is a world record for a pearl. The star lot at Sotheby’s Geneva show was bought after a fierce bidding. It had been valued at about $2m. It was part of a major collection of jewellery sold by Italy’s royal Bourbon-Parma house. Some of the jewels had not been seen in public for 200 years. The previous record for the most expensive pearl jewel was a necklace once owned by the late Dame Elizabeth Taylor. It was sold for $11.8m at Christie’s auction house in 2011.

Sotheby’s called Wednesday’s auction in Geneva as “one of the most important royal jewellery collections ever to appear on the market”. Deputy Chair Daniela Mascetti said: “This extraordinary group of jewels offers a captivating insight into the lives of its owners going back hundreds of years.” But she noted the “inherent beauty of the pieces themselves; the precious gems they are adorned with and the exceptional craftsmanship they display are stunning in their own right”. Other auctioned items include the natural pearl and diamond necklace, a pair of pearl and diamond earrings, and a monogram ring with a lock of her hair. There were also pieces from King Charles X, the Archdukes of Austria and the Dukes of Parma, including a diamond tiara.

The whole collection was sold for more than £53m. Marie Antoinette was an Austrian princess before her marriage to France’s King Louis XVI. Her extravagant lifestyle turned her into a hate figure in the years leading up to the French Revolution, when many French people could barely afford to feed their families. She smuggled out her jewellery to her family in Austria before her failed attempt to flee France with Louis XVI and their children. She was guillotined in 1793 at the age of 37. Read more here-https://bbc.in/2K8Kn6c and https://dailym.ai/2OHXxHP

-8ct. Bulgari Blue Diamond to Lead Christie’s NY. A Bulgari diamond ring will be the top lot at next month’s Christie’s New York auction, with a presale estimate of $13 million to $18 million. The cushion-cut, 8.08-carat, fancy-vivid-blue piece will go under the hammer at the Magnificent Jewels sale on December 5, the auction house said last week. The stone is one of a number of colored diamonds on offer, including a heart-shaped, 15.56-carat, fancy-intense-pink diamond-pendant necklace estimated at $9.5 million to $12 million.

Christie’s will also offer a pair of earrings weighing a combined 77.71 carats from the 187.7-carat Diavik Foxfire, North America’s largest known gem-quality rough diamond. The earrings are valued at $1 million to $3 million, with the buyer getting something extra for the money: a trip to the Diavik diamond mine in Canada’s Northwest Territories, where Rio Tinto unearthed the stone in 2015. Other notable lots include a 28.70-carat, D-color, VVS2-clarity, type IIa diamond ring from the estate of art collector Lee Vandervelde. Proceeds from the piece, estimated at $1.5 million to $2.5 million, will benefit the Los Angeles-based Children’s Hospital and Children’s Institute.

An Old European-cut, 15.19-carat, D-color, internally flawless diamond ring will also go under the hammer with a presale estimate of $1.5 million to $1.8 million. An 8.09-carat fancy-vivid-yellow diamond ring by Gillot & Co. will also be up for auction, as will signed pieces from Bulgari, Cartier, Harry Winston, Tiffany & Co., Van Cleef & Arpels, Suzanne Belperron and René Boivin. The auction house will preview the jewels between November 30 and December 4, ahead of the sale. Read more here-http://bit.ly/2TbwvMo

-Graff Unveils Polished from 1,109ct. Lesedi La Rona. Graff Diamonds has showcased the first of more than 60 diamonds it plans to polish from the 1,109-carat Lesedi La Rona rough stone it bought last year. They include two D-color, flawless diamonds mounted on rings, of which one is a cushion-cut, 6.06-carat stone and the other an oval-cut, 11.12-carat diamond. All polished from the Lesedi La Rona will have D color and “exceptional” clarity, Graff said Monday. The company’s gemologists and craftsmen spent more than a year analyzing the rough stone, which it bought from Lucara Diamond Corp. for $53 million in September 2017.

The polished diamonds will range from under a carat to more than 100 carats, mounted as solitaire rings, earrings and pendants, it said. All of the diamonds will carry a grading report from the Gemological Institute of America (GIA), and will have a laser inscription of the words “Graff” and “Lesedi La Rona” alongside the GIA number. “Destined to be passed down through generations, the legacy of the Lesedi La Rona will live on in this truly remarkable collection of jewels,” Graff said. The Lesedi La Rona was the second-largest rough diamond in history after the 3,106-carat Cullinan diamond. Lucara unearthed it in November 2016 at its Karowe mine in Botswana. Read more here-http://bit.ly/2PuHgeR

-14ct. Diamond Prompts Bidding War at Fellows. Fellows sold a 14-carat diamond ring for more than double its estimate following a bidding war at its auction in Birmingham, UK, last week. The emerald-cut, 13.86-carat, H-color, VS2-clarity stone fetched GBP 310,500 ($399,680) against a presale estimate of GBP 100,000 to GBP 150,000 ($128,700 to $193,100), the UK auction house said. Read more here-http://bit.ly/2z7hRxo

-24ct. Diamond to Lead Bonhams Auction. Bonhams will spotlight a 24.31-carat diamond at its upcoming Fine Jewels sale in London, estimating it will fetch $1.7 million to $2.3 million. The step-cut, D-color, internally flawless diamond belongs to a private collector, and will come to auction for the first time on December 5. The sale will feature several Kashmir sapphires, including a cushion-shaped, 8.08-carat sapphire ring with diamonds, with a presale estimate of $390,000 to $520,000.

A cushion-shaped, 9.29-carat sapphire ring featuring brilliant-cut and baguette-cut diamonds, valued at $280,000 to $360,000, will also go under the hammer. In addition, a collection of jewelry by Van Cleef & Arpels will be up for sale, including three Art Deco, gem-set bracelets estimated at $90,000 to $130,000. Bonhams will auction several of the luxury jeweler’s renowned “mystery-set” pieces, which give the illusion that the stones are being suspended, with no visible prongs. Read more here-http://bit.ly/2zdEctb

-Sotheby’s to Sell Sinatras’ 21ct. Diamond. Sotheby’s New York will auction a 20.60-carat diamond ring that Frank Sinatra gifted to his wife on their engagement in 1976. The emerald-cut diamond ring is one of several pieces of Barbara Sinatra’s jewelry that will feature at the Magnificent Jewels auction on December 4. Frank popped the question by throwing two diamonds on their bed and telling her to pick one.

Once she had made her selection, he then dropped it into her glass of champagne. The formal proposal didn’t come until Barbara made him choose which finger to put it on, according to her memoir, Lady Blue Eyes. Barbara wrote of her “romantic husband,” saying Frank “went out of his way to make me feel loved and cherished every day.” The Sotheby’s auction will also feature a Sinatra-owned ruby and diamond bracelet by Van Cleef & Arpels with the jewelry house’s unique “mystery set” style that assembles stones so that no prongs are visible.

The piece is estimated at $150,000 to $250,000. A platinum, diamond and gold-coin necklace by Bulgari valued at $15,000 to $20,000 will also go under the hammer. The jewels are part of a larger collection of Sinatra items that includes film and entertainment memorabilia, personal accessories, letters, books and artwork. Those lots will be sold at the auction house’s various December sales. Read more here-http://bit.ly/2QIyw14

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GOLD-SILVER

Gold to silver ratio at 80 to 1 with gold at $2,000 the silver price would be $25.00

Gold to silver ratio at 70 to 1 with gold at $2,000 the silver price would be $28.57

Gold to silver ratio at 60 to 1 with gold at $2,000 the silver price would be $33.33

Gold to silver ratio at 50 to 1 with gold at $2,000 the silver price would be $40.00

Gold to silver ratio at 40 to 1 with gold at $2,000 the silver price would be $50.00

Gold to silver ratio at 30 to 1 with gold at $2,000 the silver price would be $66.67

Gold to silver ratio at 20 to 1 with gold at $2,000 the silver price would be $100.00

Gold to silver ratio at 15 to 1 with gold at $2,000 the silver price would be $133.33

-Ex-Morgan trader pleads guilty to rigging monetary metals, implicates supervisors at bank. An ex-J.P. Morgan Chase trader has admitted to manipulating the U.S. markets of an array of precious metals for about seven years and he has implicated his supervisors at the bank. John Edmonds, 36, pleaded guilty to one count of commodities fraud and one count each of conspiracy to commit wire fraud, price manipulation, and spoofing, according to a release today from the U.S. Department of Justice. Edmonds spent 13 years at New York-based J.P. Morgan until leaving last year, according to his LinkedIn account. Read more here-http://bit.ly/2Q4nvu4 and http://bit.ly/2Tfm22E

-In a chaotic 2019, gold will be the ‘best house in bad neighborhood’. Are greater risks stacking up for investors in 2019? In Europe, where Italy is locking horns with the EU and a Brexit deal hangs in the balance, mega-economy Germany has just produced the worst growth in nearly six years. Even if Wall Street can successfully shake off noise from the Old Country, a fresh threat from falling oil prices, along with worries over trade and a Fed misstep may cast long shadows. “Equities appear to be in no-man’s-land,” says Sean Darby, Jefferies’ chief global equity strategist, who writes that Jerome Powell and co.’s intentions is the big thing keeping his clients up at night.

And they aren’t far off with those worries, according to our call of the day, which predicts 2019 will be a doozy for investors and advises they seek shelter in a much-neglected, glittering port. “Being long gold has been a tough investment since 2012, and so often, when we see the yellow metal gaining traction, the [U.S. dollar] regains its mojo, and we see the inevitable reversal,” writes Chris Weston, head of research at Pepperstone Group. “However, as we look into our crystal ball and gaze into 2019, emerging warning signs can be seen that suggest 2019 could be the year where gold bulls finally get their day in the sun.” Read more here-https://on.mktw.net/2PwSIGR

-ZeroHedge: Silver Cheapest To Gold In 25 Years. Read more here-http://bit.ly/2qLnlcz

-A Crack in the Dike? Tuesday’s announcement by the Department of Justice of a guilty plea by a former trader of JPMorgan for systemic “spoofing” and price manipulation of gold, silver, platinum and palladium traded on the COMEX and NYMEX futures exchanges (owned by the CME Group) sure seemed like a very big deal to me for a number of reasons. The infractions occurred from 2009 to 2015 and the trader admitted to engaging in a conspiracy to commit market manipulation on hundreds of occasions, with the knowledge and consent of his immediate supervisors.

Please take the time to read this, as it is remarkably plainspoken. First, let me get some personal feelings out of the way. I’ve received a number of comments to the effect of how this vindicates my long held belief that JPMorgan is the silver (and gold) crook of crooks. The truth is that I don’t consider it vindication (yet), but I will confess to a feeling of relief upon reading the complaint, as I believe it greatly reduces the chances of JPMorgan suing me for openly calling them the crooks that they are. To be sure, my fear of being sued was never really a personal fear, but how it might affect my wife and family. Correctly or incorrectly, I feel a great burden has been lifted. That aside, the announcement by the DOJ was remarkable in many ways, not the least of which is that this is a criminal case which involves jail time and not a civil case which only involves monetary fines.

Also, the announcement makes clear that this is very much an ongoing investigation and it’s hard to see how there won’t be further fall out for JPMorgan, since it’s obvious the guilty trader was doing what others were doing at the bank. It’s also hard for me to see how a trader involved in systemic criminal market activity in coordination with other traders at the bank doesn’t equate to systemic criminal activity by the bank itself. Notable, of course, is that of all the blizzard of spoofing and short term price manipulation cases brought recently in silver and gold, this is the first to zero in on traders at JPMorgan. Read more here-http://bit.ly/2OL5JqX

-Ray Dalio’s Faith in Gold Is Unshaken. Not even gold’s second quarterly straight decline was enough to shake billionaire hedge-fund manager Ray Dalio’s confidence in gold. Dalio’s Bridgewater Associates maintained its holdings in SPDR Gold Shares, the largest bullion-backed ETF, at 3.9 million shares, and its stake in iShares Gold Trust, the second-largest, at 11.3 million shares in the third quarter, according to a regulatory filing Tuesday. Bridgewater stayed loyal to bullion even amid an investor sell-off that sent assets in bullion-backed ETFs tracked by Bloomberg tumbling by 2.79 million ounces in the third quarter, the first such decline since the end of 2016.

The precious metal’s haven appeal has waned as the dollar rallied and borrowing costs rose in the U.S., making non-interest bearing assets less competitive. The hedge fund also added to its holdings in Barrick Gold Corp., Franco-Nevada Corp., Newmont Mining Corp. and Kinross Gold Corp. in the third quarter. In the same quarter, Bridgewater pared its stake in bullion producers including Yamana Gold Inc. and Eldorado Gold Corp. Filings released this month don’t include hedge funds’ current position, which may have changed since the end of the quarter. Money managers who oversee more than $100 million in the U.S. must file a Form 13F within 45 days of each quarter’s end to list those stocks as well as options and convertible bonds. The filings don’t show non-U.S. securities, holdings that aren’t publicly traded, or cash. Bloomberg

-South African Gold Output Plunges Most Since 2015 in September. South African gold production plunged the most in almost four years in September. Output retreated 19 percent from a year earlier, Pretoria-based Statistics South Africa said in a statement Thursday. Overall mining output fell 1.8 percent, while production of platinum-group metals increased 7.2 percent, it said. Producers in South Africa, which operate some of the world’s deepest and most labor intensive mines, have been forced to reduce output and cut thousands of jobs as they struggle to contain operating costs. The continent’s most-industrialized economy fell into its first recession in almost a decade in the second quarter. Sixty-nine workers have died in South African mines so far this year, with the nation’s gold mines accounting for more than half of the fatalities, Mineral Resources Minister Gwede Mantashe said last month. Bloomberg

-Pan American Agrees to Buy Silver Miner for $1.1 Billion. Pan American Silver Corp. agreed to buy Tahoe Resources Inc. for at least $1.07 billion in a cash and stock deal, sending the shares in the embattled precious-metals mining company soaring. Reno, Nevada-based Tahoe climbed as much as 49 percent, from a record low on Tuesday. The company has been struggling in the past year as silver declined and its efforts to restart its flagship Escobal silver mine in Guatemala dragged on amid a dispute over indigenous rights. The Pan American purchase agreement offers Tahoe shareholders a combination of cash and stock as well as “contingent value rights,” which would kick in following the restart of Escobal, according to a joint statement from the companies Wednesday.

The purchase price without the contingent rights represents about a 35 percent premium to Tahoe’s volume-weighted average price for the 20 days through Nov. 13, the companies said. The deal, which would create one of the world’s largest silver producers, comes as declining prices for the metal have helped erode miners’ shares. On Wednesday, silver dropped below $14 an ounce to trade near its lowest since 2009, as a strong dollar and rising U.S. interest rates dent its appeal. “Where the market sits right now it’s the right time to do deals,” Pan American Chief Executive Officer Michael Steinmann said during a conference call to discuss the agreement. Talks between the companies had been on and off again for some time, he said. “I was always interested in the Escobal asset.” Bloomberg

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Investing In Fancy Colored Diamonds

Investing in rare colored diamonds is a long-term investment. The economic cycles of the past 15 years have seen colored diamonds reach new heights in value as price records were broken.

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The Investor Learning Center was created to provide investors with the tools to make the right decision when it comes to investing in Rare Colored Diamonds.
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The GIA report for this diamond is not posted on the website at this time however it is available. Please fill out a form to inquire or call us directly at 800-456-3934 for more information.

1 Carat Radiant Cut Fancy Vivid Pink

  • Year: 1980
  • Total Price: $50,000
  • Price per Carat: $50,000
  • Source: Private Sale

1 Carat Radiant Cut Fancy Vivid Pink

  • Year: 1990
  • Total Price: $150,000
  • Price per Carat: $150,000
  • Source: Auction

1 Carat Radiant Cut Fancy Vivid Pink

  • Year: 2000
  • Total Price: $500,000
  • Price per Carat: $500,000
  • Source: Private Sale

1 Carat Radiant Cut Fancy Vivid Pink

  • Year: 2008
  • Total Price: $1,000,000
  • Price per Carat: $1,000,000
  • Source: Auction

1 Carat Radiant Cut Fancy Vivid Pink

  • Year: 2009
  • Total Price: $1,090,500
  • Price per Carat: $1,090,500
  • Source: Private Sale

1 Carat Radiant Cut Fancy Vivid Pink

  • Year: 2020
  • Total Price: $2,828,187*
  • Price per Carat: $2,828,187*

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Vivid Pink

  • Year: 2025
  • Total Price: $4,361,506*
  • Price per Carat: $4,361,506*

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Intense Yellow

  • Year: 1980
  • Total Price: $1,000
  • Price per Carat: $1,000
  • Source: Auction

1 Carat Radiant Cut Fancy Intense Yellow

  • Year: 1990
  • Total Price: $3,000
  • Price per Carat: $3,000
  • Source: Private Sale

1 Carat Radiant Cut Fancy Intense Yellow

  • Year: 2000
  • Total Price: $9,000
  • Price per Carat: $9,000
  • Source: Auction

1 Carat Radiant Cut Fancy Intense Yellow

  • Year: 2008
  • Total Price: $23,500
  • Price per Carat: $23,500
  • Source: Private Sale

1 Carat Radiant Cut Fancy Intense Yellow

  • Year: 2009
  • Total Price: $26,300
  • Price per Carat: $26,300
  • Source: Auction

1 Carat Radiant Cut Fancy Intense Yellow

  • Year: 2012
  • Total Price: $32,000
  • Price per Carat: $32,000
  • Source: Private Sale

1 Carat Radiant Cut Fancy Intense Yellow

  • Year: 2020
  • Total Price: $53,993*
  • Price per Carat: $53,993*

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Intense Yellow

  • Year: 2025
  • Total Price: $74,873*
  • Price per Carat: $74,873*

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Vivid Blue

  • Year: 1980
  • Total Price: $60,000
  • Price per Carat: $60,000
  • Source: Private Sale

1 Carat Radiant Cut Fancy Vivid Blue

  • Year: 1990
  • Total Price: $200,000
  • Price per Carat: $200,000
  • Source: Private Sale

1 Carat Radiant Cut Fancy Vivid Blue

  • Year: 2000
  • Total Price: $600,000
  • Price per Carat: $600,000
  • Source: Private Sale

1 Carat Radiant Cut Fancy Vivid Blue

  • Year: 2008
  • Total Price: $1,350,000
  • Price per Carat: $1,350,000
  • Source: Private Sale

1 Carat Radiant Cut Fancy Vivid Blue

  • Year: 2009
  • Total Price: $1,494,000
  • Price per Carat: $1,494,000
  • Source: Auction

1 Carat Radiant Cut Fancy Vivid Blue

  • Year: 2020
  • Total Price: $4,555,497*
  • Price per Carat: $4,555,497*

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Vivid Blue

  • Year: 2025
  • Total Price: $7,561,708*
  • Price per Carat: $7,561,708*

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Red

  • Year: 1950
  • Total Price: $13,800
  • Price per Carat: $13,800
  • Source: Private Sale

1 Carat Radiant Cut Fancy Red

  • Year: 1987
  • Total Price: $927,000
  • Price per Carat: $927,000
  • Source: Auction

1 Carat Radiant Cut Fancy Red

  • Year: 2008
  • Total Price: $2,000,000
  • Price per Carat: $2,000,000
  • Source: Private Sale

1 Carat Radiant Cut Fancy Red

  • Year: 2009
  • Total Price: $2,074,600
  • Price per Carat: $2,074,600
  • Source: Private Sale

1 Carat Radiant Cut Fancy Red

  • Year: 2020
  • Total Price: $3,103,720*
  • Price per Carat: $3,103,720*

*Estimated value based on current market trend