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WORLD FINANCIAL REPORT ON RADIO December 20th 2018
CHARTS OF THE WEEK-QUOTES-QUICK HITS
-CHART OF THE WEEK: The $7.9 Trillion Pile of Negative-Yielding Debt Is Growing Fast. For all the hand wringing over the end of ultra-loose monetary policy, the world just doesn’t seem able to shake its addiction to negative-yielding debt. Only two months ago, speculation was rife that the Bank of Japan would have to step in to stop yields from rising. Now, rates on benchmark bonds are poised to drop back below zero. In Germany there are no positive yields as far as seven years along the curve.
And globally, bonds with negative yields total $7.9 trillion close to levels seen at the start of the year and up from the 2017 low of $5.7 trillion reached in October. Bonds are back in demand after a sea change in sentiment swept financial markets in recent weeks as the outlook for growth decisively worsened. “I expect the global economy to be substantially worse in 2019 than this year,” said Akira Takei, global fixed income manager in Tokyo at Asset Management One Co., which oversees the equivalent of $500 billion. “The recent drops in bond yields and equities reflect such outlook. Investor views are also changing on the U.S. as an end of the current policy tightening is coming into sight.” Bloomberg
-CHART OF THE WEEK: A Fifth of China’s Homes Are Empty. That’s 50 Million Apartments. 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
-There are over 8 million abandoned homes in Japanese suburbs, according to The Japan Times.
-CHART OF THE WEEK: The Trader Who Nailed the Bitcoin Top Just Covered His Short. Just as the euphoria surrounding Bitcoin was peaking last December, Mark Dow decided to short the leading digital currency. Almost a year to the day, and after a more than 80 percent decline from its record high price, Dow has closed out the trade. “I’m done. I don’t want to try to ride this thing to zero,” Dow said in a phone interview Tuesday. “I don’t want to try to squeeze more out of the lemon. I don’t want to think about it.
It seemed like the right time.” Dow, a former International Monetary Fund economist who manages a family office in Southern California, bet that Bitcoin would decline in value right after Bitcoin futures began trading, pushing the price to a high of $19,511 exactly one year ago. Dow, who announced Tuesday on Twitter that he’s “saying goodbye” to the short, took profits twice already this year, he said. The 2017 run-up in Bitcoin’s price can partly be attributed to the fact that many people didn’t understand the currency or its underlying technology, blockchain, Dow said. Bloomberg
-Fed hikes rate, lowers 2019 projection to 2 increases. The Fed took the target range for its benchmark funds rate to 2.25 percent to 2.5 percent. The central bank continued to include in its statement that more rate hikes would be appropriate. The Federal Reserve raised its benchmark interest rate a quarter-point Wednesday but lowered its projections for future hikes. As markets had expected, the central bank took the target range for its benchmark funds rate to 2.25 percent to 2.5 percent. The move marked the fourth increase this year and the ninth since it began normalizing rates in December 2015. Officials, though, now project two hikes next year, which is a reduction but still ahead of current market pricing of no additional moves next year. Read more here- https://cnb.cx/2LqJ3vV
-$14,889,930,106,680. That’s how much the total value of companies listed on the world’s stock markets has declined since peaking at $87,289,962,917,450 on Jan 28. In other words, almost $15 trillion has been wiped off the global equity market this year. Bloomberg
-Alan Greenspan: Investors should prepare for the worst. Alan Greenspan says the party’s over on Wall Street. The former Federal Reserve chairman who famously warned more than two decades ago about “irrational exuberance” in the stock market doesn’t see equity prices going any higher than they are now. “It would be very surprising to see it sort of stabilize here, and then take off,” Greenspan said in an interview with CNN anchor Julia Chatterley. He added that markets could still go up further but warned investors that the correction would be painful: “At the end of that run, run for cover.” Read more here- https://cnn.it/2ECj6ZM
-Ron Paul: A 50% correction will spark depression-like conditions that may be ‘worse than 1929.’ Ron Paul is warning this year’s corrections could be a precursor to an epic market collapse that may come sooner than investors think. According to the former Republican presidential candidate, Wall Street is becoming more vulnerable to near-depression conditions within the next 12 months. “Once this volatility shows that we’re not going to resume the bull market, then people are going to rush for the exits,” Paul said Thursday on CNBC’s ” Futures Now.”
The relentlessly bearish former congressman added that “It could be worse than 1929.” During that year, the stock market began hemorrhaging, falling almost 90 percent and sending the U.S. economy into a tailspin. Paul, a well-known Libertarian, has been warning Wall Street a massive market plunge is inevitable for years. He’s currently projecting a 50 percent decline from current levels as his base case, citing the ongoing U.S.-China trade war as a growing risk factor. “I’m not optimistic that all of the sudden, you’re going to eliminate the tariff problem. I think that’s here to stay,” he said. “Tariffs are taxes.” Read more here- https://cnb.cx/2Sa324G
-Canadian stocks fell Monday to their lowest close since September 2016 with every sector in the red, as crude prices settled below $50 a barrel for the first time in 14 months. The S&P/TSX Composite Index lost 1.6 percent to 14,362.65. Health-care stocks led the retreat, losing 4.6 percent as pot shares retreated amid a broader risk-off mood. Aurora Cannabis Inc. fell 5.5 percent. Bloomberg
-The stock market is on pace for its worst December since the Great Depression. Two benchmark U.S. stock indexes are careening toward a historically bad December. Both the Dow Jones Industrial Average and the S&P 500 are on pace for their worst December performance since 1931, when stocks were battered during the Great Depression. The Dow and S&P 500 closed Monday down 7.6 percent and 7.8 percent this month, respectively. December is typically a very positive month for markets. The Dow has only fallen during 25 Decembers going back to 1931. The S&P 500 averages a 1.6 percent gain for December, making it typically the best month for the market, according to the Stock Trader’s Almanac. While the S&P 500 began dissemination in 1950, the performance data was backtested through 1928. It’s worth noting that historically, the second half of December tends to see gains. Read more here- https://cnb.cx/2UXYeRV
-Cramer: ‘It’s not a safe market’ in fact, it’s the most treacherous stock market I’ve seen in ‘many a year’ CNBC’s Jim Cramer says the persistent market sell-off has gone beyond concerns about the economy and the Fed. “I think that there’s a lot of people who say, ‘I got to get out. I got to get out, because everyone else is getting out,'” says the “Mad Money” host. The Dow, S&P 500 and Nasdaq started the new week by opening sharply lower after they all tanked about 2 percent Friday. CNBC
-Jeffrey Gundlach says the S&P 500 is headed to new lows: ‘I’m pretty sure this is a bear market.’ “We’ve had pretty much all of the variables which characterize a bear market,” DoubleLine Capital CEO Jeffrey Gundlach told CNBC. He “absolutely” believes the S&P 500 will go below the lows that the index hit early in 2018. CNBC
-Jeffrey Gundlach says passive investing has reached a ‘mania’ investors should avoid index funds. “My strongest advice is to not invest in passive U.S. equity funds,” DoubleLine Capital CEO Jeffrey Gundlach said Monday. The market for index funds has reached $6 trillion, while the market ETFs has ballooned to $5 trillion. “I think in fact that passive investing and robo-advisors are going to exacerbate problems in the market because it’s herding behavior,” Gundlach added. CNBC
-Jim Chanos says there’s something wrong with the stock market when rates this low cause panic. Prominent short seller Jim Chanos says he’s concerned about the fragility of the stock market in response to increases in interest rates. “One of the things that worries me is just how fragile we seem to be to small rises in interest rates,” Chanos told CNBC’s Sarah Eisen. While government debt rates rallied for much of 2018 sometimes sharply borrowing costs are still far below historical norms. CNBC
-Billionaire Stan Druckenmiller is glad he’s no longer in the hedge fund business now that algorithmic and quantitative trading have taken over markets. “I made 30 percent a year for 30 years. Now, we aren’t even in the same zip code, much less the same state,” he quipped of his recent returns in an interview with Bloomberg Television. Druckenmiller, 65, explained that his investment process has always involved divining so-called market signals. But quantitative funds, which now account for $1 trillion in assets, have muted or even silenced those cues, making it a lot less clear what’s behind price moves. “I think the message over eight or nine months is still great,” said Druckenmiller, who converted his hedge fund to a family office after closing Duquesne Capital Management in 2010. “I just think over a week or two, you’re getting noise that used to mean something, and now it doesn’t mean anything.” Bloomberg
-Ken Langone: The stock market is a ‘casino’ now but there’s still a way for individual investors to profit. Trading in the stock market nowadays is like gambling, says billionaire businessman and philanthropist Ken Langone. “The only hope you have is to own great companies, put them away and don’t look at the market,” the 83-year-old advises. “There’s a disconnect between what used to be the yardstick by which you measure stocks,” he warns. CNBC
-Corporate America celebrated the first full year under the new tax law by rolling out a record-setting $1 trillion of stock buybacks. US companies, led by Lowe’s and AbbVie, rewarded shareholders by unveiling $34.4 billion in buybacks last week, according to TrimTabs Investment Research. That lifted repurchase announcements above $1 trillion for the first time ever, TrimTabs said, exceeding the prior record of $781 billion set in 2015. And the trend continued on Monday. Johnson & Johnson, mired in a controversy over its iconic baby powder product, announced a $5 billion buyback.
Boeing also ramped up its buyback program. The buyback boom has been fueled by strong economic growth and the corporate tax overhaul that was signed into law a year ago. “It’s no coincidence,” said David Santschi, TrimTabs’ director of liquidity research. “A lot of the buybacks are because of the tax law. Companies have more cash to pump up the stock price.” Not only did the tax law reduce the corporate rate, but it gave a big break to companies returning foreign profits. Companies have used a sizable chunk of that windfall to reward shareholders. Buyback announcements havespiked 64% so far this year, TrimTabs said. CNNMoney
-The stars of the biggest hedge funds are losing their shirts as analysts fear a major financial wipeout is imminent. From Ken Griffin’s Citadel, to Israel Englander’s Millennium Management, one big name after another is racking up negative returns lately, amid bad bets in a saturated market. Over 11,000 hedge funds manage in excess of $3 trillion in assets. And hundreds of funds could be gone by next year, say insiders. “Some sectors of the fund industry are crowded and competing with other investment vehicles,” said Nicholas Tsafos at EisnerAmper, who advises hedge funds.
There’s also a wide disparity lately in returns among managers chasing similar investment strategies. “That alone should cause the number of closures to increase, as bad managers get fired and money is recirculated into those managers that do better,” said Don Steinbrugge, managing partner at Agecroft Partners, a hedge fund consulting and marketing firm. As hedge funds fall like dominoes (and returns underperform the S&P 500), managers also blame a sharp rise in stock market volatility and low interest rates.
Although there are still more launches than failures and as new money was infused into hedge funds in the first half of 2018 nervous investors have pulled $10.1 billion from hedge funds through October, according to eVestment. “We remain bearish, as investor positioning does not yet signal ‘The Big Low’ in asset markets,” said Michael Hartnett, chief investment strategist at Merrill Lynch, summing up overall investor sentiment in the firm’s latest fund survey. Analysts are forecasting a surge in redemptions, especially toward year end, as more clients pull money out of losing funds. NYPost
-David Rosenberg is warning there’s a debt bomb in Canada that threatens to plunge this country’s economy into a recession next year. “Nothing is inevitable, but the risks of recession for Canada for next year are higher than a lot of people think,” the chief economist at Gluskin Sheff + Associates told Andrew McCreath on Weekly, while pointing to total household debt reaching $2.2 trillion from $1.3 trillion a decade ago. “The lagged impact of these higher rates is going to really start cascading in the next 12 months.” BNNBloomberg Interview Here- http://bit.ly/2LnrA7M
-Canada’s debt to income ratio rose in the third quarter after revisions showed households owed more relative to their incomes than was previously believed. The ratio climbed to 173.8 percent on an unadjusted basis, from 173.2 percent in the second quarter, Statistics Canada reported Friday in Ottawa. That’s down from a record 174.4 percent in the third quarter last year.The agency also introduced a seasonally adjusted series, which showed the household debt ratio was little changed in the third quarter at 177.5%, from 177.4% in the second.
The debt to income ratio was revised upwards by an average of 3.4 percentage points since the beginning of 2016 after the introduction of new income data from Canada’s federal tax collection agency. Per capita national net worth climbed to a record C$324,000. Debt service ratios were also revised. The third quarter unadjusted DSR was 13.96, down from 14.74 in the prior period. On an adjusted basis, the DSR was 14.51, the highest since 2008. Bloomberg
-Bank of Canada Governor Stephen Poloz isn’t buying into recession warnings, telling CTV News Chief Anchor Lisa Laflamme in an in-depth interview yesterday he doesn’t expect an economic contraction in Canada next year, while warning the country faces risks that he likens to “fender benders” rather than “big events.” On the oil price shock, Poloz said his team is trying to figure out how that will “percolate” through the economy. BNNBloomberg
-Home prices in Vancouver fell 1.9 percent in November from a month earlier, the most in a decade, extending a recent run of declines for Canada’s most expensive real estate market. The figures suggest momentum earlier this year may have been just a blip, as consumers adjust to tougher federal mortgage qualification rules. After rebounding to a record in May, prices nationwide have dropped for six straight months, the Canadian Real Estate Association reported Monday, and are hovering at levels little changed from mid-2017, when interest rates started to rise. “The decline in home ownership affordability caused by this year’s new mortgage stress-test remains very much in evidence,” said Gregory Klump, CREA’s Chief Economist. “While national home sales were anticipated to recover in the wake of a large drop in activity earlier this year due to the introduction of the stress-test, the rebound appears to have run its course.” Bloomberg
-Toronto new home prices fell at the fastest pace in more than two decades in October, further evidence that tighter mortgage lending has slowed a boom in Canada’s biggest city. Statistics Canada’s price index for new Toronto homes fell 1.4 percent in October from a year earlier, the most since September 1996. Across the country, the price increase of 0.1 percent was the slowest since 2010. The housing market has moderated this year as federal rules made it harder to qualify for a mortgage.
The Bank of Canada also raised its trend-setting interest rate five times between July 2017 and October of this year. New home prices were advancing at an annual pace of almost 4 percent late last year before the mortgage rules took effect. New home prices advanced 0.4 percent in Vancouver, while they declined on a 12-month basis in Edmonton and Calgary in the struggling oil-producing province of Alberta. On a monthly basis, new home prices were unchanged in October from September. The index includes single-family, semi- detached and row houses, but doesn’t capture condominiums that have become more popular in Toronto in recent years. Bloomberg
-After a three-year non-stop party, Toronto’s condo market is likely to settle down in 2019, some of the city’s biggest developers say. “I can’t, for a minute, imagine that we’re going to continue to see the increases that we’ve experienced,” said Jim Ritchie, executive vice president of sales and marketing at Tridel. “Do I think there’s still room for growth? Yes, but not what we’ve seen in the past three years.” Toronto condo prices have surged 50 percent in the past three years to a record high of C$570,764 ($425,000) in September, according to research firm Urbanation Inc. The segment soared amid the housing frenzy in the first half of 2017. While price gains have eased since then, they remain buoyant compared with the single-home segment which has been hit by harsher mortgage lending rules and rising interest rates. Bloomberg
-The Canadian government announced C$1.5 billion ($1.1 billion) in loans for the oil and gas sector, as well as some government funding for unspecified projects, after a supply glut sank heavy crude prices to as low as $13.46 a barrel last month. The country’s energy and trade ministers announced the aid package Tuesday morning in Edmonton. It includes “commercial financial support” loans of C$1 billion from Export Development Canada, and C$500 million in commercial financing from the Business Development Bank of Canada. The funds are available immediately.
The EDC money will be aimed at exporters, including those who have “working capital needs,” while the C$500 million will be for “higher risk but viable oil and gas small business enterprises,” and be spread over three years, according to a government statement. “All in all, it has to do with liquidity,” Trade Minister Jim Carr said at a press conference. The loan money can augment oil producers’ relationship with commercial banks and “will go a long way in helping them get through this tough spot.”
The liquidity injection is aimed at producers pinched when the price of heavy crude plunged in what Prime Minister Justin Trudeau called a crisis. Since then, the province announced a production cut and heavy crude prices have almost doubled, though global oil prices remain depressed. However, the announcement doesn’t offer support for the Alberta government’s plan to buy its own rail cars. Another phase of federal measures could also be announced later, one person familiar with the plans said, speaking on condition of anonymity. Bloomberg
-Suncor Energy has set its 2019 capital budget at $4.9-$5.6 billion, with the middle of that range representing a flat budget compared to this year. Production is seen in a range of 780,000-820,000 boe/day. Suncor said in its release there’s still “considerable uncertainty” about the impact of Alberta’s mandatory production cuts. BNNBloomberg
-Economic jitters and surging supplies from the U.S. to Russia dragged oil prices to the lowest level in 15 months. Futures fell as much as 5.8 percent in New York on Tuesday. Anxieties about economic growth swirled after Chinese President Xi Jinping appeared to push back against U.S. President Donald Trump in a key Beijing speech. Meanwhile, American investors braced for an interest-rate hike. “Oil has gotten caught up in all the panic you’re seeing,” said Bill O’Grady, chief market strategist at Confluence Investment Management LLC in St. Louis. “This is all about fears of a recession. It’s risk-off everywhere.” A U.S. government report Monday forecast surging shale-oil production, adding to worries about a glut. In Moscow, Russian Energy Minister Alexander Novak said production is rising, although the country is preparing to implement output curbs to conform with an OPEC+ accord.
-Global debt hit a record $184 trillion last year, equivalent to more than $86,000 per person more than double the average per-capita income. Borrowing is led by the U.S., China, and Japan, the three biggest economies, the International Monetary Fund said Thursday, highlighting potential risks to global expansion given that their share of debt exceeds that of output. Overall, the amount of worldwide public and private debt is equal to about 225 percent of gross domestic product. The IMF debt figure is $2 trillion higher than the fund’s previous estimate released in October, adding end-2017 data and several countries that had not previously reported updated numbers. The agency uses data for 190 countries dating back to the 1950s. Bloomberg
-The US federal budget deficit surged to a record for the month of November of $204.9 billion, but a big part of the increase reflected a calendar quirk. In its monthly budget report, the Treasury Department said Thursday that the deficit for November was $66.4 billion higher than the imbalance in November 2017. But $44 billion of that figure reflected the fact that December benefits in many government entitlement programs were paid in November this year because Dec. 1 fell on a Saturday. For the first two months of this budget year, the deficit totals $305.4 billion, up 51.4 percent from the same period last year. The Trump administration is projecting that this year’s deficit will top $1 trillion, reflecting increased government spending and the loss of revenue from a big tax cut. The new report showed that the higher tariffs from President Donald Trump’s get-tough trade policies are showing up in the budget totals. Customs duties totaled $6 billion in November, up 99 percent from November 2017. Read more here- http://bit.ly/2POEwE6
-The federal government collected record total tax revenues of $458,653,000,000 in October and November, the first two months of fiscal 2019, according to the Monthly Treasury Statement released today. Even with these record tax collections, however, the government still ran a deficit of $305,394,000,000 for the first two months of the fiscal year. That is because while collecting a record $458,653,000,000 in taxes, the government spent $764,046,000,000. The record $458,653,000,000 in federal taxes in October and November of fiscal 2019 was up $5,280,090,000 from the $453,372,910,000 in total taxes (in constant November 2018 dollars) that the federal government collected in October and November of fiscal 2018. Read more here- http://bit.ly/2EroSg5
-U.S. student loan debt outstanding reached a record $1.465 trillion last month and one particular set of borrowers is having a hard time paying back their loans, according to a Bloomberg analysis of student loan securitization data. This debt is raising fiscal risks. “Over 90% of student loans are guaranteed by the U.S. Department of Education, meaning that if a recession causes a rise in youth unemployment and triggers mass defaults, this contingent liability could prove burdensome for the U.S. government budget,” said Paul Della Guardia, economist at the Institute of International Finance in emailed comments. The record student debt level is more than double the $675 billion outstanding in June 2009 when the recession ended. For one group of young adults that took out loans in 2012, student loan debt is a particularly stark reminder of college. Loans disbursed in 2012 have defaulted at a faster rate than any other loan cohort since the financial crisis. Bloomberg
-Half of America hasn’t recovered from the recession. A decade after the financial crisis, the U.S. economy seems to be firing on all cylinders, with unemployment at a 50-year low and growth hitting its stride. But a deeper look reveals a more troubling picture: Between 2012 and 2015 a period when the recovery seemed to be gaining speed nearly half of all counties nationwide saw flat or declining growth, according to new government data. More broadly, the Commerce Department figures highlight a stark and worrisome reality: While a handful of places around the U.S. are thriving, most regions are barely trudging ahead. And that trend is creating a widening geographic gap between a relatively few prosperous areas, mostly urban oases, and the desert of stagnation that lies beyond. “For many communities, what you’ve got is a lost decade of economic growth,” said John Lettieri, CEO of the Economic Innovation Group, a bipartisan think tank, adding that “the topline economy doesn’t match the local experiences.” CBSNews
-The European Central Bank confirmed this morning its 15-billion euro monthly quantitative easing program will end this month. The ECB also left its main rates unchanged. BNNBloomberg
-Even migration is bigger in Texas. Dallas leads all U.S. cities as the largest net gainer with 246 people arriving daily, according to a Bloomberg analysis of 2017 Census data on migration to the 100 largest U.S. metropolitan areas. In 2014, the crown belonged to Houston with 269 migrants per day. After Dallas, Sun Belt beacons Phoenix, Tampa, Atlanta and Orlando round out the top five. Seattle, at number six with a gain of 116 people daily, is the only cold-weather destination in the top 10. The daily influx surpassed 100 people in nine cities, while Chicago, New York, and Los Angeles saw an exodus of more than 100 people every day. Bloomberg
-A new survey shows that the “top problem” cited by Americans is “government,” and the second top problem is “immigration.” For contrast, among the issues seen as least problematic for Americans are “unemployment-jobs” and “gun control/guns.” In the survey, conducted by Gallup after the midterm elections, the polling firm asked Americans about the country’s top problems and then listed those issues that were “mentioned by at least 3% of respondents.” Nineteen percent of respondents cited “government” as the problem, making it the top issue of concern. In second place came “immigration,” cited by 16% of the respondents. However, when broken down politically, 29% of Republicans said immigration is a problem but only 7% of Democrats said the same. CNSNews
-The number of Americans expecting the U.S. economy to get worse in the next year is at its highest point since 2013, a national NBC/Wall Street Journal poll shows. A majority of Americans also say President Donald Trump has been untruthful about the investigation into Russia’s interference in the 2016 campaign, and half say the probe has given them doubts about Trump’s presidency. Overall, 28 percent of Americans said the economy will get better in the next year, while 33 percent predict it will get worse, according to the survey, which was released Sunday.
Those numbers were essentially reversed from January, when 35 percent said the economy would get better and 20 percent said it would get worse. “For the first time in Trump’s presidency, his safety net of a robust economy shows signs of unraveling,” said Fred Yang, a Democratic pollster with Hart Research Associates. The poll, taken a month after November’s midterm elections, shows more Americans want congressional Democrats to take the lead in setting policy for the U.S. Only one in 10 said Trump took the message from the midterm elections that voters wanted a change, and that he’s making the necessary adjustments. Bloomberg
-How much would you pay for a brownie? Chef Jason Harley, owner of Baby J’s Burgers in LA, has one you can buy for $500. In 2016, Harley debuted his $100 doughnut covered in 24-karat gold at his doughnut shop Birdies in downtown L.A. What makes this brownie so expensive? It’s made with a Johnnie Walker Blue Label glaze and covered in gold leaf. It’s also served in a humidor with a Monte Cristo cigar on the side. KABC
-Tiger Woods’ Net Worth: $800 Million In 2018. Tiger Woods cracked the winner’s circle for the first time in five years when he won the Tour Championship in September. It was a remarkable comeback after four back surgeries for Woods, who will turn 43 at the end of the month. While injuries have limited the golfer on the course since 2014, he continues to be a bankable star off it, more than two decades after he turned pro. The result is an estimated net worth of $800 million, tied for ninth with author James Patterson in Forbes‘ annual measure of America’s Wealthiest Celebrities.
The golfer and author rank just behind hip-hop artist Diddy ($825 million). Star Wars creator George Lucas is the top celebrity at $5.4 billion. Woods has earned $1.5 billion since he turned pro in 1996 ($1.8 billion adjusted for inflation), with more than 90% of the tally from endorsements, appearance fees and golf course design work. His $116 million in career prize money on the PGA Tour is 31% ahead of Phil Mickelson, who sits in second. Woods was the highest-paid athlete for 11 straight years when he was at the peak of his game and winning 14 major championships. Read more here- http://bit.ly/2GsOR9v
-Tony Robbins: Robots will disrupt millions of jobs in the next 10 years cash handouts may be the answer. Expect significant shifts in the working world over the next decade, says business strategist and No. 1 New York Times best-selling author Tony Robbins. “The next 10 years, we’re going to see more change than we’ve seen in the last 150 years: in our bodies, in healing, in the way we do business, in robotics and algorithms,” he tells CNBC Make It.
That’s why universal basic income (UBI) essentially, free cash handouts to residents from their government”is something we’ll probably look at” as a solution. It could be considered, he thinks, because AI is going to eliminate millions of jobs: “For example, right now if you just take truck drivers and Uber drivers and taxi drivers and replace them, that’s five million people. Now, as a business owner, if I can buy a truck that can work 24 hours a day and never get tired and I get to depreciate the asset, or I can have an employee who I have to pay for health care for and only works seven or eight hours, it’s pretty obvious where this is going to go.” And this massive shift will happen soon.
“Whether it’s in three, five, or 10 years it’s probably in the five to 10 year period when we’re going to see these changes that’s five million jobs. If you look at what’s happening with satellites with farming, that’s going to eliminate another four to five million jobs,” he says. “You take those two sectors alone, with the technology coming in, at some point, it’ll disrupt more jobs than we had during the world economic crisis.” Read more here- https://cnb.cx/2A6xK7Q
-552-Carat Yellow Diamond Discovered In Canada, Largest In North America. It gets quite chilly in the northwest region of Canada but the diamond industry in the area is starting to burn red hot as a 552-carat yellow diamond was discovered in October. The rough diamond was unearthed at the Diavik Diamond Mine, approximately 135 miles south of the Arctic Circle in Canada’s Northwest Territories, jointly owned by mining companies Rio Tinto and Dominion Diamond Mines, which made the announcement Friday.
It is the largest diamond discovery in North America, far surpassing the previous record held by the 187.7-carat “Diavik Foxfire,” which was recovered at the same mine in 2015. The gemstone, which measures 33.74mm x 54.56mm, was discovered while passing through the initial screening process at Diavik’s recovery plant. “Abrasion markings on the stone’s surface attest to the difficult journey it underwent during recovery, and the fact that it remains intact is remarkable,” the company said in a statement. “A diamond of this size is completely unexpected for this part of the world and marks a true milestone for diamond mining in North America.” The diamond will not be sold in its rough form, Dominion said.
Due to the significance of the discovery, the company will select a partner who will cut and polish the stone. Dominion said it expects to achieve a significant main stone once the diamond is polished. It will contain the “Canadamark” hallmark showing that it was responsibly mined, natural and untreated. The certification details the gem’s Canadian history from the mine of origin to the polished stone as tracked through an independent, audited process. The trademarked Canadamark brand is owned by Dominion Diamond Mines. Read more here- http://bit.ly/2CnMsJ4
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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
-I think gold and silver are incredibly mispriced because it really reflects the excess confidence that people have in central banks and fiat currency. They should have no confidence, but they do. I don’t tell people to put their entire net worth into gold, I tell them 5% to 10%. Most people have no money in gold. Those people are going to be very unfortunate. Peter Schiff
-Silver To Climb To $20, Outperform Gold In 2019. While catalysts are in place for gold to rally in 2019, silver will be the outperforming asset next year, said Todd “Bubba” Horwitz of bubbatrading.com.
“I think silver will be up near $18 to $20 [an ounce] and I think silver is going significantly higher too and I expect it, in the next couple of years, to close the ratio between gold and silver. I expect silver to be stronger than gold when it gets started,” Horwitz told Kitco News. Watch more here- http://bit.ly/2T0fbcC
-Bulls Lining Up for Gold Means Now May Be a Good Time for Silver. The recent bounce in gold has so far happened without a similar move in silver. That might be about to change, according to Saxo Bank A/S.
Ole Hansen, head of commodity strategy at Saxo Bank, tracks the ratio of gold to silver and said the recent moves point in favor of higher silver prices. The ratio has been stretched out in recent months, showing that silver is the cheapest relative to gold in 25 years.
Hansen said the trend is starting to reverse, with the ratio falling below a 50-day moving average this week. That means that silver is outpacing gold after months of lagging behind. The white metal is up 2.3 percent this month to $14.53 an ounce, compared with a 1.1 percent advance in bullion. Still, Hansen cautioned that there are other signs of weakness. “Silver needs three things to run higher: higher gold, weaker dollar and stronger industrial metals,” said Ole Hansen, head of commodity strategy at Saxo Bank. “So far only the gold box can be ticked.” Bloomberg
-Clive Maund: Silver Market Update. Silver is now very cheap compared to gold (as is platinum) and recently hit a 24-year low reading as can be seen on the latest chart for the silver to gold ratio shown below, which means two things one it is very good value relative to gold, and the other is that this kind of extreme normally occurs ahead of a major new sector bull-market. Silver is also cheap relative to its average AISC (all-in sustaining cost of production) which implies a shortage down the road and much higher prices. Read more here- http://bit.ly/2ukL5rH
-Clive Maund: Gold Market Update. We are going to start this update on a positive note by pointing out that the gold to silver ratio recently reached a 24-year record extreme as shown by the 20-year chart for this ratio below, which alone is a sign that the sector is close to a bottom and also that a major new bull-market is likely to start before much longer. However, there is the small matter of a looming market crash and the collateral damage it could on inflict on most everything, including the PM sector, to take into account. Read more here- http://bit.ly/2V0HpFA
-Signals Show Great Upside For Gold In 2019. Gold is showing a divergence with the dollar and stocks, indicating upside potential for the yellow metal in 2019, said Mike McGlone, senior commodity strategist at Bloomberg Intelligence. “A lot of the drivers are turning positive. The volatility of the stock markets is turning up, from the lowest ever and the dollar has had a substantially strong year. The trade-weighted dollar is the best performing major asset class on the planet this year. It’s up 8% this year, yet gold is trickling, it’s up/down 6%. To me, I see a sign of divergent strength,” McGlone told Kitco News.
McGlone added that those pressure factors are likely to go away in 2019, paving the way for gold to rally. Watch more here- http://bit.ly/2QIDSNW
-Indians Are Buying Gold for as Little as One Cent. Indians are buying gold for as little as one rupee (1 cent) as retailers offer online sales in bite-sized portions to prop up shrinking demand in the world’s second-biggest consumer. Demand for gold is falling, partly as a result of government measures, higher local prices and the metal’s fading appeal among more youthful customers. That’s forcing jewelers to adapt online purchases to appeal to a more internet-savvy, younger population.
“A lot of people have been buying at one rupee,” according to Gaurav Mathur, managing director of digital platform SafeGold, which has partnered with payments apps such as Flipkart Online Services Pvt.’s PhonePe to sell gold starting at that price. “It’s a low-risk way to try the product.” Buyers only get physical delivery of the metal once they have paid enough for one gram of gold, currently about 3,200 rupees. The low barrier of entry, compared with a minimum purchase of 1 gram in the traditional market, and faster transactions, which can be done on a phone in about 40 seconds, are the biggest lures for the product, Mathur said.
Since its launch last year, about 3 million people have already transacted on the platform and the company, which counts the World Gold Council as one of its investors, is targeting to raise this to 15 million by next year, he said. India’s most popular digital payments service, Paytm, said it has sold more than 2.2 tons of gold online to 19 million customers since introducing the service in April 2017. Mobile wallet service provider One Mobikwik Systems Pvt., which started selling gold on its platform in October, also gives customers the option to convert the digital metal to jewelry. The company has a target of selling about 1 ton of gold in the financial year starting March, it said in a statement.
The market is still small compared with the country’s overall consumption of gold, which stood at 524 tons in the nine months ended September. India’s consumption of gold, almost all of which is imported, has been declining because of the government’s efforts to curb its trade deficit and combat so-called black money by discouraging investors who used the metal to evade taxes. Demand for the yellow metal last year fell by about 23 percent from a peak of 1,002 tons in 2010. Meanwhile, benchmark gold futures in Mumbai are set to post a third year of annual gains in 2018 aided by a weaker rupee, which fell to a record low earlier this year. Bloomberg