The World Financial Report

World Financial Report – February 28th, 2019

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WORLD FINANCIAL REPORT ON RADIO FEBRUARY 28TH 2019
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CHARTS OF THE WEEK-QUOTES-QUICK HITS

-CHART OF THE WEEK: Unloved Part of Treasury Curve Keeps Signaling a U.S. Recession.Even as the Federal Reserve’s dovish pivot eases concerns over narrowing Treasury spreads and the recessionary signals they harbor, one section of the yield curve is indicating that the policy shift may be too little, too late. The gap between 1- and 5-year yields turned negative late last year, around the time when the Federal Reserve delivered its fourth interest-rate increase of 2018 and penciled in two hikes for 2019.

The gap has largely been inverted ever since, plummeting to as low as minus 18.8 basis points on Jan. 3, and trading around minus 6.9 basis points Monday. The 1-to-5-year spread is as good an indicator of economic slumps as the more commonly monitored 1-to-10-year gap, according to Steven Blitz, chief U.S. economist at TS Lombard, a London-based research provider. The curve out to the 5-year yield may be as predictive as the spread to the 10-year because of the wide array of lending that occurs on terms of 5 years or less, including business, personal, auto, and construction loans, he said in an interview from New York. Bloomberg

-CHART OF THE WEEK: Too Much Cash, Too Little Time: The Latest U.S. Debt Cap Dilemma. Uncle Sam has to find a way to shovel more than $100 billion in cash out the door by the end of this week. That’s when the U.S. Treasury has to reduce its cash balance to about $199 billion in order to comply with rules surrounding the reinstatement of the debt ceiling. The cap is set to go back into effect at the end of this Friday and at that point the cash balance should be at or below the level it was at when the current suspension went into effect in February 2018. The Treasury’s cash hoard ended last week at around $312 billion, leaving around $113 billion to reach its target. The repayment of a $50 billion cash-management bill that matures this Friday will take care of some of the gap, but that still leaves some $63 billion to be reduced by other means. Bloomberg

-CHART OF THE WEEK: The Risk Rally Hasn’t Been This Reliant on the Fed Since 2012. Markets are likely to be jittery as Federal Reserve Chair Jerome Powell testifies to the Congress on Tuesday, judging by the first two months of the year. The Fed’s infamous U-turn that took expectations for rate hikes this year to zero has led to a drop in real borrowing costs and a subsequent rally in equities, creating a degree of divergence between the two last seen when Ben Bernanke helmed the central bank in 2012. The opposite moves in rates and equities the five-year yield on inflation-linked Treasuries has tumbled by more than 50 basis points since mid-December, while the S&P 500 Index has surged 19 percent since Christmas has been so persistent over the past 40 sessions, the pair are diverging to an extent that’s only occurred 2 percent of the time over the past decade. Bloomberg

-CHART OF THE WEEK: Never Before Has the Fate of Hedge Funds Turned on So Few Stocks. As a group, hedge funds have been backing away from the stock market even as its dramatic rally added trillions of dollars to share values since Christmas. But one aspect of their faith is rising: the belief that the stocks they do own are the right ones. It’s visible in a measure of concentration that plots how much of the average hedge fund portfolio is dominated by its biggest holdings. According to quarterly filings compiled by Goldman Sachs, the top 10 holdings on average made up 70 percent of a fund’s long portfolios, the highest since at least 2002. The five stocks that appeared most frequently among the top 10 holdings of hedge funds are: Amazon, Microsoft, Facebook, Alphabet and Alibaba, data from Goldman Sachs showed. Bloomberg

-CHART OF THE WEEK: Goldman Traders Had Most Losing Days in Seven Years Last Quarter. The end of 2018 proved to be a rough one for Wall Street. Goldman Sachs Group Inc. just showed how bad it got. The bank’s traders posted losses on at least 19 days in the last quarter of the year, including a day where losses approached almost $100 million, according to its annual regulatory disclosure. It was the worst showing for the bank by that measure since 2011, according to filing data reviewed by Bloomberg.

Goldman Sachs’s fixed-income traders posted the lowest revenue since the financial crisis in the fourth quarter and new Chief Executive Officer David Solomon is carrying out a review of the trading business. The bank’s executives have proposed plans to trim the fixed-income trading unit, people with knowledge of the matter have said. That would likely include personnel cuts as well as a reduction in the capital dedicated to its core trading business within the fixed-income group, the people said. Bloomberg

-CHART OF THE WEEK: U.S. Oil Imports at 23-Year-Low, Output Hits Another Record. The U.S. imported the least amount of crude oil on a weekly basis in 23 years, as OPEC-members Saudi Arabia and Venezuela cut their shipments to unusually low levels. Weekly crude imports fell 1.61 million barrels a day to 5.92 million, the lowest level since 1996. Weekly imports from Saudi Arabia fell to 346,000 barrels a day for the week ending Feb. 22, the Energy Information Administration reported Wednesday. Domestic crude production skyrocketed to 12.1 million barrels a day.

The fall in imports comes as Venezuelan oil shipments drop due to U.S. sanctions against the government of Nicolas Maduro, and as Saudi Arabia curtails exports to the U.S. in an effort to reduce an oil glut in America. American crude stockpiles fell 8.65 million barrels last week. Saudi Arabia Energy Minister Khalid Al-Falih said earlier that the Saudis are leaning toward extending oil-output cuts into the second half of this year. His remarks came after U.S. President Donald Trump tweeted this week that oil prices are too high and called on the Organization of Petroleum Exporting Countries to relax production curbs. Last year, the Saudis boosted production to record levels after Trump expressed displeasure at rising prices. Al-Falih has said he expects oil markets to balance by April. Bloomberg

-CHART OF THE WEEK: Americans’ Perceptions of U.S. World Image Best Since 2003. Fifty-eight percent of Americans believe the U.S. rates “very” or “somewhat favorably” in the world’s eyes. Though the current figure is up just slightly from the 55% recorded last year, it represents the highest figure Gallup has found since 2003. Read more here-http://bit.ly/2EyTNGM

Fed Chief Powell on mounting US debt: It would be a ‘very big deal’ to not pay our bills when due. As Congress again wrestles over raising the debt ceiling, Fed Chairman Jerome Powell cringed at what would happen if it fails to do so. “It’s beyond even consideration. The idea that the U.S. would not honor all of its obligations and pay them when due is something that can’t even be considered,” the central bank leader says. CNBC

-CBO Says U.S. Will Run Out of Cash by Early Fall Without Debt Limit Increase. The Treasury Department should be able to avoid the need for an increase in the U.S. debt limit into late summer or early fall if Congress doesn’t act earlier, the nonpartisan Congressional Budget Office said Tuesday. Treasury can shift funds by using “extraordinary measures” to delay a default on payments, CBO said in a statement. The debt ceiling is currently suspended and is scheduled to come back into effect on March 2.

“With a large inflow of tax revenues in April, those extraordinary measures would enable the Treasury to continue financing the government’s activities for several months,” CBO said in a report. “However, if the debt limit remains unchanged, the ability to borrow using those measures will ultimately be exhausted, and the Treasury will probably run out of cash near the end of this fiscal year or early in the next one.” CBO said that after the extraordinary measures run out, the Treasury would have to delay payments, default on payments or both. The measures could run out earlier or later than the estimated time period, CBO said. The next fiscal year begins on Oct. 1.

Senate Finance Committee Chairman Chuck Grassley predicted on Monday that Congress probably wouldn’t need to deal with the debt ceiling until around then. He said lawmakers likely would raise the debt limit as part of a deal on budget caps for fiscal 2020. Earlier Tuesday, House Majority Leader Steny Hoyer, a Maryland Democrat, told reporters he has told Treasury Secretary Steven Mnuchin that he would back a debt ceiling increase without seeking any policy concessions. “I’ve made it very clear that the debt limit is a phony issue,” Hoyer said, adding that the limit needs to be raised periodically because of spending already enacted by Congress. Bloomberg

-Millennials Are Facing $1 Trillion in Debt.More than a decade has passed since young Americans faced debt levels this high. Debt among 19 to 29-year-old Americans exceeded $1 trillion at the end of 2018, according to the New York Federal Reserve Consumer Credit Panel. That’s the highest debt exposure for the youngest adult group since late 2007. Debt levels play a role in how young adults view their spending conditions, according to a University of Michigan survey Friday. Younger adults those under age 35 have reduced their spending compared with previous generations possibly because of weakened job prospects, delayed marriage and educational debt. Policy makers have recognized that lower spending limits economic growth. As a result, a number of policies to boost younger adults spending such as forgiving student debt have entered the political arena, according to Richard Curtin, director of the University of Michigan consumer survey. Bloomberg

-Federal Reserve Chairman Jerome Powell took the message to Congress on Tuesday that the central bank is in no rush to raise rates too quickly in 2019 despite risks facing the US economy. In prepared testimony, Powell, the world’s most powerful central banker, stuck with the Fed’s previous commitments to be “patient” as it weighs future rate hikes after floating plans to raise interest rates three times or more this year. It now expects to raise rates only two times in 2019. “Over the last few months we have seen some crosscurrents and conflicting signals,” Powell said in prepared testimony to start two days of hearings on Capitol Hill on the state of the economy. The Fed chairman had previously described a number of factors that could result in a “less favorable outlook” for the US economy since last year, prompting policy makers to pump the brakes on its plans. CNNMoney

-Powell says economic theory of unlimited borrowing supported by Ocasio-Cortez is just ‘wrong.’ An increasingly popular theory espoused by progressives that the government can continue to borrow to fund social programs such as Medicare for everyone, free college tuition and a conversion to renewable energy in the next decade is unworkable, Federal Reserve Chairman Jerome Powell said Tuesday. “The idea that deficits don’t matter for countries that can borrow in their own currency I think is just wrong,” Powell said during congressional testimony in the Senate.

The notion behind what is called “Modern Monetary Theory,” or MMT, is that as long as the Fed can keep interest rates low without sparking inflation, the national debt and budget deficit won’t be an issue. MMT has been espoused by politicians including Rep. Alexandria Ocasio-Cortez, D-N.Y., and Democratic presidential candidate Sen. Bernie Sanders of Vermont. Powell conceded that he has not read up on the theory but said he has heard some “pretty extreme claims” about how it might be implemented. CNBC

-Janet Yellen says Trump has a ‘lack of understanding’ of Fed policies and the economy. Former Fed Chair Janet Yellen, in an interview with “Marketplace,” questions President Trump’s understanding of central bank policy and macroeconomics. Trump declined to reappoint Yellen to the Fed, making her the first central bank chief not to serve two terms since the Carter administration. CNBC

-Alexandria Ocasio-Cortez’s Green New Deal Could Cost $93 Trillion, Group Says. Representative Alexandria Ocasio-Cortez’s ambitious plan to fight climate change won’t be cheap, according to a Republican-aligned think tank led by a former Congressional Budget Office director. The so-called Green New Deal may tally between $51 trillion and $93 trillion over 10-years, concludes American Action Forum, which is run by Douglas Holtz-Eakin, who directed the non-partisan CBO from 2003 to 2005.

That includes between $8.3 trillion and $12.3 trillion to meet the plan’s call to eliminate carbon emissions from the power and transportation sectors and between $42.8 trillion and $80.6 trillion for its economic agenda including providing jobs and health care for all. “The Green New Deal is clearly very expensive,” the group said in its analysis. “It’s further expansion of the federal government’s role in some of the most basic decisions of daily life, however, would likely have a more lasting and damaging impact than its enormous price tag.” Backers of the plan say cost of inaction would be more expensive. The resolution itself, released earlier this month by Ocasio-Cortez and Massachusetts Democratic Senator Ed Markey points to a major report on global warming released by the United Nations last October that says catastrophic climate change could cost more than $500 billion annually in lost economic output in the U.S. by 2100.

“Any so-called ‘analysis’ of the #GreenNewDeal that includes artificially inflated numbers that rely on lazy assumptions, incl. about policies that aren’t even in the resolution is bogus,” Markey said on Twitter. “Putting a price on a resolution of principles, not policies, is just Big Oil misinformation.” Representatives of Ocasio-Cortez, a New York Democrat, didn’t immediately respond to a request for comment. Republicans have embraced the sweeping plan because they think they can use it to cast Democrats as extreme, take back seats in Congress and possibly keep the White House in 2020. Bloomberg

-This chart shows how 2019’s monster stock market comeback is not driven by fundamentals. The S&P 500’s monster comeback coincided with a wave of downward growth and earnings revisions from Wall Street. First-quarter earnings growth forecast for the S&P 500 firms has turned negative and consensus GDP growth for the first quarter has also been slashed to below 2 percent. “Either markets have to come down to where growth expectations are, or growth and earnings expectations have to move higher to justify current market valuations,” says Torsten Slok, Deutsche Bank’s chief international economist. CNBC

-‘Father of Reaganomics’ says ‘get out of the market’ bond and stock market ‘and put your money in cash.’ David Stockman, the so-called “Father of Reaganomics,” is at it again with his most recent prognostication of doom for Wall Street and the broader economy, even as the stock market tests fresh highs for the year. The 72-year-old politician and businessman, who was the director of Office of Management and Budget under President Ronald Reagan in the 1980s, told Fox Business’s Neil Cavuto on Thursday that investors ought to get out of the market and retreat to the presumed safety of Treasury bills and cold, hard cash. Read more here-https://on.mktw.net/2ElmaqL

-The stock market rally to start 2019 is one for the history books. Both the Dow Jones Industrial Average and the Nasdaq have yet to register a weekly decline so far this year. This would mark the first time since 1964 that the Dow has rallied in each of the first nine weeks of the year, and the first time in history that has happened for the Nasdaq. The Dow has rallied more than 11 percent while the tech-heavy Nasdaq is up 9 percent. CNBC

-A leading Wall Street firm predicts global interest rates could fall to three year lows this year to about 1 percent. According to Medley Global Advisors’ Ben Emons, the scenario is becoming more likely because inflation is very subdued. “With all this shock that happened in the fourth quarter and energy prices falling quite sharply, the effect on inflation is going to last at least though the second or third quarter,” the firm’s managing director said Thursday on CNBC’s “Futures Now.” In a recent note, he points out the the divergence between the dollar and global Treasury yields.

If the global economy does not see a material recovery, he explained that deflation could become entrenched. “Global central banks have responded to what the Fed has been communicating to not only switching to a pause, but basically potentially embarking on quantitative easing again, for example, in Japan,” said Emons. “That, too, drives global interest rates back down, which presumably we can revisit those lows that we saw in 2016.” Emons sees the 10-Year Treasury Note yield falling as low as 2 percent this year. It hit a low of 1.31 percent in July 2016. This week, the yield traded around 2.7 percent. He contends these lower interest rates will lead to favorable to stock markets gains around the world, including here at home. CNBC

-Norway’s $1 trillion sovereign wealth fund bought a net $22 billion in equities at the end of 2018 and continued to make “significant” purchases at the start of this year to take advantage of a market rout as it builds its global holdings. Fund in 2018 suffered first loss since 2011, declining 6.1% in 2018, or 485 billion kroner ($57 billion). Stock holdings slid 9.5%, bonds rose 0.6% and real estate gained 7.5%. Fund net bought 185 billion kroner in equities in fourth quarter. Fund held 66.3% in stocks, 30.7% in bonds and 3% in real estate end of 2018. Bloomberg

-The Kraft Heinz food empire has a debt problem. Heinz took on debt when the ketchup giant was taken private in 2013 by 3G Capital for $28 billion. Financing was also a key ingredient that made the marriage of Kraft and Heinz possible in 2015.The Warren Buffett-backed food giant’s serious missteps have brought its bloated balance sheet into sharp focus. Last week, Kraft Heinz (KHC) posted a massive loss of $12.6 billion and warned that 2019 profits will tumble. Its stock price plummeted 27% on Friday.

Kraft Heinz, the owner of Oscar Mayer, Velveeta and Planters nuts, is now scrambling to raise cash that can be used to pay down its nearly $31 billion of long-term debt. The food giant slashed its dividend by 36% and announced plans to sell off brands, reportedly including the Maxwell House coffee business. “Its balance sheet has ballooned,” JPMorgan Chase analyst Ken Goldman wrote in a report late last week. Goldman noted that Kraft Heinz’s profits are “flat,” revenue has “shrunk” and the balance sheet is “levered.” “This is not an ideal progression of financial metrics,” Goldman wrote. And that’s not to mention the SEC investigation into Kraft Heinz’s books that the company disclosed. Read more here-https://cnn.it/2Ue4NyY

-It’s been a monster rally for one beverage stock. Monster Beverage, which sells its eponymous energy drinks, has rocketed more than 68,000 percent higher over the past 20 years, crushing the 200 percent gain by PepsiCo and 40 percent increase by Coca-Cola. CNBC

-Tim Hortons has opened its first restaurant in China in the People’s Square in the city of Shanghai. The Shanghai Tim Hortons is the first location in the country following the signing of a master franchise agreement last year with the New York-based private equity fund the Cartesian Capital Group. Shanghai came first, but the chain expects 1,500 locations will open across China over the next decade. The chain, which is now headquartered in Oakville, Ont., currently also has 4,800 locations across Canada, the U.S., Mexico, the Philippines and the Middle East. CBC

Home prices in 20 U.S. cities rose in December at the slowest pace in four years, continuing to decelerate as buyers balked at purchases amid still-elevated housing costs and a falling stock market. The S&P CoreLogic Case-Shiller index of property values increased 4.2 percent from a year earlier, after a downwardly revised 4.6 percent in the prior month, data showed Tuesday, below the median estimate of economists. Nationally, home prices climbed 4.7 percent, the least since 2015. Bloomberg

-For Manhattanites longing for luxury homes that may seem out of reach, it’s a good time to make a deal. A nine-bedroom, seven-bathroom townhouse on the Upper East Side sold in mid-February for $29.5 million-33 percent less than the original asking price after sitting on the market for 15 months. Last week, the top contract was a 7,000-square-foot (650-square-meter) brick Georgian townhouse with a garden overlooking the East River that sold for $18.5 million. It was listed in September for $21 million. Bloomberg

-U.S. consumer confidence improved in February, topping all forecasts and snapping a three-month losing streak, after the U.S. government ended the longest shutdown in the country’s history and the trade war edged toward a resolution. The confidence index climbed to 131.4 from 121.7, the New York-based Conference Board said in a report Tuesday. That compared with a Bloomberg survey of economists that called for a rise to 124.9. The measure gauging Americans’ views on present conditions rose to an 18-year high while consumer expectations posted the largest monthly gain since 2011. Bloomberg

-The stock market meltdowns in 2018 obliterated $1 trillion of the fortunes of the world’s richest individuals, according to a list by wealth compiler Hurun Report. The report, China’s version of the Forbes rich list, showed Chinese billionaires still outnumbered those from any other country as of Jan. 31, at 658. Several newly minted ones amassed wealth through big share offerings, while 212 Chinese tycoons lost their dollar billionaire status. The U.S. had 584 billionaires, followed by Germany with 117. The biggest gains in wealth last year came in the areas of technology, media and telecoms, followed by real estate and other investments, manufacturing and retailing.

The wealthiest Chinese was e-commerce giant Alibaba’s founder Jack Ma, the world’s 22nd most wealthy person, with $39 billion. But Pony Ma Huateng of Internet giant Tencent Holdings, with $38 billion and Xu Jiayin of property developer Evergrande, with $37 billion, were close behind. Though Chinese and other Asians are steadily gaining in wealth, Amazon founder Jeff Bezos topped the global chart for the second year running, with wealth estimated by the Hurun Global rich list at $147 billion. Bill Gates ranked second with $96 billion and Warren Buffett was third with $88 billion. Read more here-http://bit.ly/2SvEse2

-Smart assistants could soon come with a ‘moral AI’ to decide whether to report their owners for breaking the law. That’s the suggestion of academics at who say that household gadgets like the Amazon Echo and Google Home should be enhanced with ethical smart software. This would let them to weigh-up whether to report illegal activity to the police, effectively putting millions of people under constant surveillance. Read more here-https://dailym.ai/2TiMGKO

-India and Pakistan say they’ve launched airstrikes against each other. Here’s what you need to know. Tensions between nuclear powers India and Pakistan escalated this week after each country said it carried out airstrikes against the other, prompting concerns about a potential outbreak of war in South Asia. On Tuesday, India said its air force conducted strikes against a militant camp in Pakistani territory. A day later, Pakistan said its air force carried out strikes into India-controlled territory and claimed to have shot down two Indian jets. CNBC

-When SpaceX’s Falcon 9 rocket took off on Thursday night, it carried humanity’s entire backup plan with it. It was headed to the moon, the world’s ultimate cold-storage unit. The Arch Mission Foundation (AMF) created the Lunar Library, a 30-million-page long compendium of humanity’s greatest cultural offerings, encoded it on a specially designed disc meant to last a billion years, and sent it to the moon to keep it safe. The disc is being carried to its final resting place on the moon’s surface aboard Beresheet, the Israeli spacecraft (and Google Lunar XPrize contender) that was carried to space by the Falcon 9, CNET reports. Read more here-http://bit.ly/2IFno5q

-California’s next ‘big one’ may not be an earthquake. According to a new study from the U.S. Geological Survey, a future volcanic eruption is not only inevitable, hundreds of thousands of people are in harm’s way. The 50-page report, California’s Exposure to Volcanic Hazards, released Monday, assigns threat levels to eight volcanoes in California moderate, high, and very high. Most of them are located in the northern and central part of the state. Researchers say nearly 200,000 people live, work or pass through California’s volcanic hazard zones on a daily basis, and there’s a 16 percent probability of an eruption in the next 30 years. The scientists based the prediction on the amount of volcanism over the last three-thousand, or so, years. Read more here-https://cbsloc.al/2ThSpAA

-The world has become a more peaceful place with fewer people dying in armed conflicts, scientists have claimed. Experts from Norway’s Peace Research Institute Oslo examined statistics from ‘all possible’ wars, the countries involved, and how many people were killed. Research director Håvard Mokleiv Nygård suggested the Korean War in the early 1950s may have been a ‘breaking point’ signalling a change in the number of people killed in battle. Read more here-https://dailym.ai/2BO3qzJ

-An autographed Tom Brady rookie card sold for a record amount in an online auction on Monday. ESPN reports that the Brady card was part of the 2000 Playoff Contenders Championship Ticket collection, the same year Brady was drafted by the New England Patriots in the sixth round of the 2000 NFL Draft. The rare card, one of only 100 made and one of only two which received a grade of nine or higher by the Beckett Grading Services, fetched $400,100 smashing a previous modern card record set four days earlier when a 1997 Michael Jordan card generated $350,100. Read more here-https://read.bi/2EhmcQk

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-The story behind Lady Gaga’s 128-carat yellow diamond Oscars necklace, last worn by Audrey Hepburn. For the occasion, Gaga chose a black silk faille gown and leather gloves by Alexander McQueen, accessorised with diamonds by Tiffany & Co. One diamond in particular: the Tiffany diamond, a vast yellow stone one of the largest in the world which dates back over a century. She joins just two other women who have worn the diamond previously one of those being Audrey Hepburn, who famously wore it in the press photographs for Breakfast at Tiffany’s. Here, five things to know about this legendary jewel.

1. It dates back over a century

The Tiffany diamond one of the largest yellow diamonds in the world has a history which spans over a century, pre-dating not just the Oscars ceremony, but the birth of cinema itself (the first films are considered to be those of the Lumière brothers, shown in 1895). Discovered in South Africa’s Kimberley diamond mines in 1877, it was purchased by eminent American jewellery trader Charles Lewis Tiffany a year later for $18,000 (the transaction saw him deemed “the King of Diamonds”, a label he maintained for much of his life). Subsequently, the rough stone was transported to Paris to Tiffany gemologist Dr. George Frederick, who cut the stone into a rounded cushion-cut weighing a staggering 128.54 carats with 82 facets 24 more than the traditional ‘brilliant cut’. The final diamond is over an inch wide, and just under an inch top-to-bottom, with its vivid yellow colour said to evoke a flame burning within.

2. It’s basically priceless

In the years afterwards, the Tiffany diamond would become the centrepiece of the jeweller’s exhibits at world fairs including the 1939–40 World’s Fair in New York City, the second largest American world’s fair in history and appeared as part of a holiday window display in their New York store in 1955. It has only been on sale once, though: on November 17, 1972 a playful advertisement ran in the New York Times saying the un-set stone could be purchased for $5 million in an offer good for just 24 hours. Unsurprisingly, there were no buyers accounting inflation, the figure would be over $30 million today and the stone remains unsold, and essentially priceless, today.

3. Only two other women have ever worn it before one was Audrey Hepburn

In its 144 years, Lady Gaga is only the third woman to have worn the Tiffany Diamond, and both previous outings were over half a century ago. Its appearance on the Oscars red carpet marks the diamond’s first awards ceremony appearance, though the precious gem is no stranger to media attention. At the 1957 Tiffany Ball held in Newport Rhode Island, Mary Whitehouse wore the diamond in a necklace among the 1,200 guests in attendance (the total value of jewellery worn at that ball is said to have reached $20 million). Four years later in 1961, it was the turn of Audrey Hepburn to wear the diamond, this time set in a necklace designed by Jean Schlumberger. It was, quite aptly, in promotional photographs for Breakfast at Tiffany’s that Hepburn wore the necklace, and the whole look black Givenchy dress, black gloves, and a diamond tiara to match the necklace has since become one of the most recognised in fashion history. Read more here-http://bit.ly/2Str9KM

The Rubik’s Cube is still a very popular puzzle toy. The fact is that it’s even more popular than in the 80’s.

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GOLD-SILVER-PALLADIUM

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

-Greg Hunter: Craig Hemke Interview, Bear Market in Gold & Silver is Over. Listen here-http://bit.ly/2VsaCcd

-Greg Hunter: Martin Armstrong Interview, Gold Rising Because It Protects Against Government. Listen here-http://bit.ly/2T3LUCi

-Greg Hunter: Michael Pento Interview, Intractable Inflation Very Dangerous New Paradigm. Listen here-http://bit.ly/2SsoJME

-Trey Reik Senior Portfolio Manager Sprott Asset Management USA. 2019 Top Ten List. Gold Coiling for Spirited Advance. Similar to early 2016, when global financial markets were destabilized by the Fed’s initial 12/16/15 rate hike, the gold price responded quickly to market fallout from Chairman Powell’s early October overreach, and has remained in steady uptrend ever since. Importantly, gold’s advance has not been derailed by the S&P 500’s 18.1% bounce from Christmas Eve through 2/15/19.

To us, gold’s performance clearly signals Fed policy error, and we believe spot gold is coiling for spirited advance as global central banks pivot back toward easing. For gold investors, this is the mix of real-deal fundamentals on which spectacular gains are based. Given the seminal nature of catalysts now in play for precious metals, we felt the timing appropriate for a comprehensive review of factors driving the gold price. In this report, we have compiled our Top 10 List of fundamentals supporting a portfolio allocation to gold in 2019. Because our gold investment thesis rests on epic global imbalances, our first few sections review underpinnings of our long-term gold thesis.

#1. Gold has been the Best Performing Global Asset for 18 Years. We often marvel at investor apathy towards gold’s investment merits. Especially in institutional circles, gold is generally viewed as an archaic asset offering negligible portfolio utility. To us, it is remarkable that gold could remain such an institutional outcast after posting the single best performance of any global asset for eighteen years running. Since 2000, not only has bullion outperformed traditional investment assets in cumulative total return, but gold’s ongoing bull market has also proved to be highly consistent in its annual progression. As shown in the rightmost column of Figure 1, the average of gold’s annual performance in nine prominent currencies has been positive in 16 of the past 18 years. Figure 1: Annual Performance of Spot Gold in Prominent Global Currencies (2001-2018) Read more here-http://bit.ly/2Xtrukp

-Venezuelan regime took 8 tons of gold from central bank last week, Reuters says. At least 8 tons of gold were removed from the Venezuelan central bank’s vaults last week, an opposition legislator and three government sources told Reuters, in the latest sign of President Nicolas Maduro’s desperation to raise hard currency amid tightening sanctions. The gold was removed in government vehicles between Wednesday and Friday last week when there were no regular security guards present at the bank, Legislator Angel Alvarado and the three government sources said. Read more here-http://bit.ly/2T6n5Fw

-Citigroup says Venezuela deal covered $1.6 billion in gold. Citigroup Inc. said it entered into a financing deal with Venezuela’s central bank in 2015 essentially using $1.6 billion of gold held at the Bank of England as collateral. A subsidiary bought the precious metal up front, taking full legal ownership under a contract that requires Venezuela’s central bank to periodically buy back portions at predetermined dates, Citigroup said in a filing Friday. The agreement became the subject of a Bloomberg report this week on the firm’s efforts to resolve the deal now that stiffer sanctions are in place. Read more here-http://bit.ly/2XoFsUO

-Spoofing is just one of the dirty tricks in the manipulative tool kit of the crooked commercial traders on the COMEX and how it would be a real shame for the DOJ to focus simply on spoofing and miss the big manipulative picture. Late last Wednesday night (after the close of most active trading), the commercial crooks employed another of their dirty trading tricks; actually, selling small quantities of gold and silver contracts with the express intent (and success) of driving prices lower during the most illiquid period of what is, essentially, 24-hour continuous COMEX trading.

The Wednesday overnight COMEX sell orders were real in that they were intended to be executed (unlike spoofing), but they also had the same net effect as spoofing, namely, they were primarily intended to cause prices to fall. Had these same sell orders been entered instead during the active prime time trading hours of Tuesday and Wednesday, they would have been executed at much more advantageous prices to the sellers but wouldn’t have had any effect on driving prices lower. This deliberate and intentional selling at the most illiquid trading times may not have a catchy term, such as spoofing, but it is every bit as manipulative. (I call it “night moves”).

The intent and players behind these “night moves” are unmistakable. The only traders that could possible benefit from sudden sharp moves down are those holding short positions and there are only a handful of traders holding most of the COMEX gold and silver short positions, so they are easily identified. Thursday’s $20+ drop in gold and 30+ cent drop in silver gave a $500 million (half a billion) temporary reprieve to the 8 big COMEX gold and silver shorts. I know that a half a billion bucks overnight is ample motive for someone in the hole for $1.8 billion to try the “night moves” dirty tool because I’ve seen it pulled off more times than I care to count. The question is will the Justice Department see it?Silver analyst Ted Butler Feb 23 2019 via Ed Steer edsteergoldandsilver.com subscribe here-http://bit.ly/1fdAByN

-Ted Butler: Silver Market Update. Silver analyst Theodore Butler writes a twice weekly newsletter on precious metals. Only a few people get to read this important newsletter. I’ve been talking to Ted about releasing one full issue for people to read. It’s important for investors to see the scope of his analysis. Mr. Butler has been a paid consultant to my company Investment Rarities for almost 20 years. I can vouch for his absolute integrity and his cautious approach in analyzing silver and gold. He relies on evidence and facts in arriving on his conclusions. He analyzes every known fact about silver and his knowledge of the silver market is unsurpassed. It’s no exaggeration to call him a silver genius. He has agreed to release the following current newsletter which gives insight into the thoroughness of his approach. Read more here-http://bit.ly/2UbxiwU

-Keith Neumeyer CEO First Majestic: A major bid, most likely from central banks, is coming onto the market for gold and is affecting silver in a positive way. “I want to see silver really break through $17.50 to $18.00 [an ounce]. I think that’s kind of the key number. We did test that level in early 2018 and it failed and it got all the way down, as we know, to sub-$14.00,” Neumeyer told Kitco News on the sidelines of the BMO Global Metals and Mining Conference. “We need to see a real breakout.” Neumeyer added that should silver break past $18.00 an ounce, we will see the beginning of a five-year bull cycle. Watch more here-http://bit.ly/2XrL1BX

-‘Bubble’ Warning Sounds Over 2019’s Hottest Commodity. Palladium’s deficit-driven ascent has some analysts warning of the growing potential for a correction given the rapid sprint upward. The silvery-white metal used to control harmful emissions in gasoline-fueled cars has surged about 40 percent in four months, hitting repeated records, as a supply deficit deepens and demand surges. It’s the top-performing raw material tracked by Bloomberg this year, and the threat of a strike by a mining union in key producer South Africa has added extra momentum this week.

Yet as palladium widens its premium over other metals including a near-$700 gap with sister metal platinum banks including Saxo Bank A/S and Commerzbank AG say gains look increasingly unsustainable. The two metals are potentially interchangeable as pollution-reducing catalysts in vehicles, although switching requires time and money spent on research. “Palladium has entered into bubble territory,” Ole Hansen, head of commodity strategy at Saxo Bank, said by email. “But as long we see no change in the outlook for tight supply or changing demand dynamics from consumers, the price could go higher.” Spot palladium surged 1.3 percent to settle at $1,564.37 an ounce at 5pm in New York, topping its previous closing-price record reached on Monday.

Signs that palladium is starting to be driven by more traditional factors like economic data and investor sentiment raise the probability “that finally the rosy glasses are taken off and prices come back to earth,” said Georgette Boele, coordinator of FX and precious metals strategy at ABN Amro Bank NV. “If this would happen the sell-off could be very dramatic, as prices rose at an almost exponential level. So I would say fasten your seatbelts.” Commerzbank also issued a warning, saying the commodity “is showing more and more signs of being a bubble.” UBS Group AG strategist Joni Teves has said there’s scope for deep pullbacks even as market participants now talk about the potential for the metal’s price hitting $2,000. Bloomberg

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Investing In Fancy Colored Diamonds

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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