Radio Show Newsletter
WORLD FINANCIAL REPORT ON RADIO MARCH 28th 2019
CHARTS OF THE WEEK-QUOTES-QUICK HITS
-CHART OF THE WEEK: Canada’s Inverted Curve Steepens as Real Yield Turns Negative. Canada has joined the U.S. in the inverted yield curve club, signaling a growing risk of recession that may keep Stephen Poloz on hold for his final 14 months as head of Canada’s central bank. The yield on Canada’s 10-year bond dipped to 1.57 percent Monday, or 10 basis points lower than the rate on the three-month Treasury bill, compared with a gap of 6 basis points Friday. That inversion hasn’t happened since 2007, at the start of the financial crisis sparked by a U.S. housing crash.
The 10-year inflation-linked bond, meanwhile, offers a negative yield in real terms, after accounting for consumer prices. The so-called inverted yield curves in both the U.S. and Canada reflect concerns that a global economic slowdown will keep the Federal Reserve and the Bank of Canada from raising rates – and may even prompt a rate cut if it worsens. “A rate cut would require signs that the economy is declining,” said Craig Alexander, chief economist at Deloitte Canada, in a television interview with BNN Bloomberg Friday. Still “the inverted yield curve is troubling. Inverted curves have often been accompanied by recession.” Bloomberg
-One by One, Global Bond Markets Are Flashing the Same Warning. Wherever you look in developed markets, sovereign bond yields are at their lowest levels in years as traders ratchet up bets that major central banks will be easing. Yields in Australia and New Zealand dropped to record lows after a closely-watched part of the U.S. curve inverted on Friday as investors wager that the Federal Reserve will need to cut rates. Trading volumes in Treasury futures were double the norm during Asian trading, while Japan’s 10-year yields fell to the lowest since 2016. “Bond markets globally, along with dovish central banks, have been telling us a slowdown is on the way,” said Jeffrey Halley, senior market analyst at Oanda Corp. in Singapore. “Some parts of the world will be better equipped than others to handle this. The U.S. can at least cut rates and apply monetary tools, while things could be worse for Europe and Japan, where they cannot.” Bloomberg
-The bond market is flashing its biggest recession sign since before the financial crisis. The spread between 3-month and 10-year Treasury notes has fallen below 10 basis points for the first time since 2007. An inverted yield curve, where short-term yields are higher than their longer-term counterparts, is considered a reliable recession signal. The Federal Reserve this week said the U.S. economy is still strong but is facing challenges from global weakness. CNBC
-CHART OF THE WEEK: The $10 Trillion Pool of Negative Debt Is a Late-Cycle Reckoning. The stockpile of global bonds with below-zero yields just hit $10 trillion intensifying the conundrum for investors hungry for returns while fretting the brewing economic slowdown. A Bloomberg index tracking negative-yielding debt has reached the highest level since September 2017 as 10-year bunds trade in negative territory and the U.S. yield curve flashes recession warnings.
With central banks in dovish mode, money managers face increasing pressure to reprise the yield-chasing mentality synonymous with quantitative easing, according to Gary Kirk, a founding partner at London-based TwentyFour Asset Management with $19 billion overall. “This obviously tempts those investors holding cash to move along the maturity curve or down the rating curve to seek yield, which is once again becoming a scarce commodity,” he said. “It’s a classic late-cycle conundrum.” Kirk is “resisting the temptation” to snap up longer-dated credit obligations that could succumb to defaults in a downturn and prefers duration bets in interest-rate markets. Bloomberg
-CHART OF THE WEEK: World of Negative Debt Expands to One-Fifth of Global Market. Financial repression is alive and well after a decade of monetary stimulus. Investors shopping for investment-grade debt around the world are being greeted with below-zero yields in almost one-fifth of the market. That’s the highest proportion in 16 months, according to data compiled by Bloomberg. In the wake of an unexpectedly ultra-dovish shift by the Federal Reserve and weak European data, many investors are reassessing the outlook for growth.
That’s sparking demand for safe-haven assets, which helped trigger an inversion of the U.S. yield curve on Friday a dynamic that itself is compounding market fears. The bond rally sent a Bloomberg index tracking outstanding negative-yielding debt past $10 trillion on Friday. It edged up again on Monday, and is hovering at the highest level since September 2017. The total now accounts for more than 19 percent of the market value of the Bloomberg Barclays Global Aggregate Bond Index, a benchmark of global investment-grade debt comprising everything from Treasuries to corporate and emerging-market issues. Bloomberg
-CHART OF THE WEEK: A Bond Fund Beating 91% of Its Peers Sees Dollar Gloom Ahead. As investors digest the Federal Reserve’s latest dovish pivot and the inversion of the U.S. yield curve, Prashant Chandran at Western Asset Management sees it all pointing to a weaker dollar and support for riskier assets across the globe. Our take is that the Fed will not move this year, and perhaps lifts once more when it’s close to the end of 2020. Our base case is that U.S. growth will be lower than expected, but our macro team continues to believe that curve inversion at this time is not really pointing to recessionary fears in the U.S. As U.S. growth moderates, as the Fed has taken on a fairly dovish tone, that really means that the dollar will weaken going forward. Our expectation is that the Dollar Index will weaken to the low-90 range. [Editor’s note: The gauge is currently about 97.] This is a phenomenon that lasts through most of the year. Bloomberg
-Half of Older Americans Have Nothing in Retirement Savings. The bad news is that almost half of Americans approaching retirement have nothing saved in a 401(k) or other individual account. The good news is that the new estimate, from the U.S. Government Accountability Office, is slightly better than a few years earlier. Of those 55 and older, 48 percent had nothing put away in a 401(k)-style defined contribution plan or an individual retirement account, according to a GAO estimate for 2016 that was released Tuesday.
That’s an improvement from the 52 percent without retirement money in 2013. Two in five of such households did have access to a traditional pension, also known as a defined benefit plan. However, 29 percent of older Americans had neither a pension nor any assets in a 401(k) or IRA account. The estimate from the GAO, the investigative arm of Congress, is a brief update to a more comprehensive 2015 report on retirement savings in the U.S. Both are based on the Federal Reserve’s Survey of Consumer Finances.
The previous report found the median household of those age 65 to 74 had about $148,000 saved, the equivalent of an inflation-protected annuity of $649 a month. “Social Security provides most of the income for about half of households age 65 and older,” the GAO said. The Employee Benefit Research Institute estimated earlier this month that 41 percent of U.S. households headed by someone age 35 to 64 are likely to run out of money in retirement. That’s down 1.7 percentage points since 2014. EBRI found these Americans face a combined retirement deficit of $3.83 trillion. Yahoo
-A TD Bank analyst predicts the loonie, which is currently worth about 75 cents US, could fall to 71 cents US sometime in 2019. At 71 cents US, one U.S. dollar would cost $1.40 Cdn, compared to approximately $1.35 Cdn today. Another analyst from Fidelity is even more pessimistic, believing the loonie could drop by 17 per cent, to 61 cents US, with one U.S. dollar costing $1.61 Cdn. CBC
-Canadians Are Feeling the Debt Burn. Low rates set off a borrowing boom. But will it all end badly? Household debt in Canada, a nation generally known for moderation, has reached levels that could be qualified as excessive. Canadians owe C$2.16 trillion which, as a share of gross domestic product, is the highest debt load in the Group of Seven economies. With the housing market cooling, a reckoning may be fast approaching. People are “freaking out,” even though, with interest rates not far above historical lows, “money still costs nothing,” says Scott Terrio, a Toronto-based manager at Hoyes, Michalos & Associates Inc., a company that specializes in insolvency.
Until recently, Canada had been lauded as a bastion of sound financial management. The country of 37 million emerged relatively unscathed from the global financial crisis, thanks in large part to the strength of its banks. But the extended run of low interest rates that followed sparked a boom in borrowing, with the ratio of debt to disposable income rising to a record 174 percent in the fourth quarter, from 148 percent a decade earlier. Read more here-http://bit.ly/2OqckZa
-The ratings agency is warning the federal government’s approach to deficit-spending is making Canada more vulnerable to an economic shock. And it’s suggesting the numbers are tough to square up with the country’s top-notch rating. “Canada’s gross general government debt, combining federal and provincial fiscal accounts, is higher than other ‘AAA’ rated sovereigns, excepting the U.S, and remains close to a level that is incompatible with ‘AAA’ status,” Fitch said in a report yesterday afternoon. BNNBloomberg
-Renowned investor Steve Eisman (made famous by the book, The Big Short) is taking aim at Canadian banks. He told The Financial Times he’s shorting some of this country’s lenders, without naming names, while calling for a “simple normalization of credit.” “This is not ‘The Big Short: Canada’,” he said. “I’m not calling for a housing collapse.” BNNBloomberg
-Sell the Big Six: Analyst warns on banks, says shares could fall 20%. A Bay Street bear on Canada’s banks says it’s time for investors to sell all of the Big Six lenders on an expectation credit losses will pile up and potentially trigger a sharp drop in share prices. “We expect credit losses to move higher by 60 per cent through the year and to be back-half loaded,” Veritas Investment Research financial services analyst Nigel D’Souza told BNN Bloomberg in an interview Tuesday.
“In 2015-16, when we last had an acceleration of credit losses, we saw 30 per cent multiple contraction. This time it could be equal or worse, but we expect share price pressure to be in the order of 10-20 per cent, maybe greater, for the sector this year.” D’Souza downgraded Bank of Montreal on Tuesday, meaning he now has sell recommendations on each of the country’s largest lenders. “We caution that the sector is likely facing an inflection point in the credit cycle, and that investors should reduce exposure to Canadian banks ahead of an acceleration of credit losses,” D’Souza wrote in a note to clients. Read more here-http://bit.ly/2TD0SKD
-Canada’s merchandise trade deficit narrowed as oil prices rebounded at the start of the year, though the gap remains the second-largest ever. The nation posted a C$4.3 billion ($3.2 billion) shortfall in January, down from December’s record high gap of C$4.8 billion, Statistics Canada said Wednesday from Ottawa. Until December, Canadian deficits had never exceeded C$4 billion. The monthly trade gap has averaged about C$2 billion over the past four years. The rapid deterioration in the country’s trade picture reflects plunging oil exports, as crude prices collapsed at the end of last year, as well as stagnant exports in the non-energy sector since mid-2018 adding to the nation’s growing list of economic headwinds. While Canada’s total exports jumped 2.9 percent in January as oil rebounded, the increase is only the first in Canada’s shipments abroad since July. Bloomberg
-US budget deficit hit $234 billion in February, a new monthly record. The US logged its biggest monthly fiscal gap ever last month. The budget widened to $234 billion in February, the Treasury Department announced on Friday, compared with a monthly shortfall of $215.2 billion a year earlier. Last month’s budget gap helped push the US government’s budget deficit up 39% to $544 billion for the first five months of the fiscal year as federal spending ballooned and revenue mostly stayed the same. The widening budget gap comes as President Donald Trump’s $1.5 trillion tax cut package has weighed on tax receipts and raised concerns about the country’s rising debt, which stands at more than $22 trillion.
Federal Reserve Chairman Jerome Powell warned earlier this week that “deficits matter,” saying the country’s fiscal stance need to be addressed. This month’s budget report was delayed by a week due to the 35-day partial government shutdown, which ended in January. The federal government spending on health programs and defense rose 9% to $1.8 trillion for October to February period, while revenues from taxes and elsewhere fell less than 1% to $1.28 trillion. Deficits typically spike in February, because that’s when Treasury begins to send out tax refunds to individuals and corporations. Treasury said that part of the reason the deficit rose was due to the timing of certain payments. Read more here-https://cnn.it/2OpFacj
-Bond market says not only is a recession coming, but the Fed will cut interest rates to stop it. Fed funds futures were pointing to a quarter point in easing Monday, as traders said scary signals continued to emanate from the bond market. On Friday, there was a so-called inversion in the yield curve, meaning very short rates rose above longer 10-year note rates, a fairly reliable recession signal. Traders say the bond market may be overreacting, while stocks seem to be ignoring the recession warnings and fears the Fed will have to jump in with one or more rate cuts to stop the economy from rolling over. CNBC
-Former Fed Chair Yellen says bond market could be hinting need for rate cut not a recession. Yellen, who led the Fed from 2014 to 2018, was asked at a Hong Kong conference about the yield curve and whether it signals a looming downturn. “My own answer is no, I don’t see it as a signal of recession,” Yellen says. Yellen also says she doesn’t see a recession as “particularly likely” though she stresses that the U.S. economy is indeed slowing. CNBC
-Mohamed El-Erian: Absent a ‘policy mistake,’ there’s no way US will have a recession this year or in 2020. The U.S. will not head into a recession this year or in 2020 as long as there’s not a “major policy mistake” from the Fed, economist Mohamed El-Erian says. His remarks are at odds with a growing list of economists and business elite predicting a downturn as well as warning signs from the bond market. CNBC
-Morgan Stanley: Get defensive because the inverted yield curve is sending a message. Investors should “remain defensively positioned” on stocks, Morgan Stanley’s equity strategist Michael Wilson says. Part of the closely watched yield curve inverted on Friday, a key indicator of an economic recession. “We think the ending of [quantitative tightening] is a rate cut and a Fed that is cutting is bearish for stocks,” Wilson says. CNBC
-Share buybacks soar to record $806 billion bigger than a Facebook or Exxon Mobil. Share repurchases have seen four straight quarters of increases and hit a record $806 billion in 2018 beating a previous watermark set before the financial crisis, according to S&P Dow Jones Indices. Apple was the biggest spender last year, and has now poured out a quarter of a trillion dollars to buy back its own stock in the past decade. The corporate practice has come under scrutiny from lawmakers who say U.S. companies aren’t spending the windfall tax cuts on job-creating investments, and instead enrich stock-owning executives. CNBC
-Stocks Flash ‘Caution’ as Bellwether ETF Loses Most Since 2012. Transportation stocks are sending cautionary signals, and exchange-traded fund investors are taking note. Investors pulled $108 million from the iShares Transportation Average ETF, ticker IYT, on Monday the most for any single day in seven years. The outflows came as the ETF’s underlying index, the Dow Jones Transportation Average, continued its downward spiral, punching through 50-, 100-, and 200-day moving averages. “The heavy trade in transports remains one of the most under-reported and significant caution signs for the broader stock market right now,” Tom Essaye, a former Merrill Lynch trader who founded “The Sevens Report” newsletter, wrote to clients Tuesday. “Especially because the most recent weakness has been driven by bad earnings, profit warnings and lowered guidance.” Bloomberg
-Baby boomers, heavily invested in stocks, are putting retirement savings at risk: study. Many people approaching retirement age today are heavily invested in stocks, potentially leaving their savings vulnerable to the next recession. “If there was a market downturn, they could lose a significant chunk of what they’ve worked so hard to save,” said Meghan Murphy, the vice president of thought leadership at Fidelity. Half of baby boomers have their 401(k) holdings invested in riskier allocations than Fidelity recommends for their age group, Murphy said. CNBC
-Home prices in January see smallest gain in nearly 4 years: S&P Case-Shiller. Home prices are still rising, but the gains continue to shrink, as fewer buyers are able to afford the homes available for sale. Nationally, prices rose 4.3 percent annually in January, down from the 4.6 percent gain in December, according to the S&P CoreLogic Case-Shiller price index. “The last time it advanced this slowly was April 2015,” says David Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices. CNBC
-At least it’ll be easier to find a seat on the subway. More than a third of all city residents say they can’t afford to live anywhere in the state much less the Big Apple and believe economic hardship will send them packing in five years or less, according to a dismal new poll. That’s 41 percent of city dwellers who say they can’t cope with New York’s high cost of living, according to a Quinnipiac poll published Wednesday.
Separately, 41 percent fear they’ll be “forced” to pull up stakes and seek greener pastures where the economic climate is more welcoming. “They are making this city a city for the wealthy, and they are really choking out the middle class,” said Ari Buitron, a 49-year-old paralegal and born-and-bred New Yorker from Forest Hills, Queens. “A lot of my friends have had to move to Florida, Texas, Oregon. You go to your local shop, and it’s $5 for a gallon of milk and $13 for shampoo. Do you know how much a one-bedroom, one-bathroom apartment is? $1700! What’s wrong with this picture?” Read more here-https://nyp.st/2U9wADU
-‘I made $3.75 an hour’: Lyft and Uber drivers push to unionize for better pay. Drivers for the rideshare companies are seeing much of their pay go to expenses while Lyft and Uber prepare for their IPOs. For over a year Rob Mead has worked as an Uber driver in Reno, Nevada, to supplement his income as a public sector worker. Now he’s wondering if it is worth it. “After gas, added monthly rideshare insurance, wear-and-tear, constant oil changes and taxes that $300 for 30 hours of work I thought I made in a week actually averages down to about $90 after expenses,” said Mead. “A few weeks ago I drove four passengers in a one-hour period. I looked at my profits and I made only $12 It was snowing, traffic was crazy and I basically risked my life to make that $12. After expenses I made $3.75 that entire hour.” Read more here-http://bit.ly/2YrZmi5
-Retailers want to go cashless. But opponents say that’s discriminatory. Retailers and restaurants say eliminating cash at their stores makes them more efficient. But opponents argue that cashless stores exclude millions of Americans without bank accounts. Americans use cash in 30% of all transactions, according to a 2017 survey from the Federal Reserve Bank of San Francisco. People dish out cash for most purchases under $10. And cash is also still the most common form of payment for people making less than $25,000 a year.
Now, cities and states are starting to take action against cash-free stores. New Jersey Governor Phil Murphy signed a law last week banning cashless stores. Philadelphia also enacted legislation prohibiting cashless stores earlier this month, and officials in New York City, Washington and San Francisco are considering similar legislation. The federal government does not require retailers to accept cash. “While card-only may be convenient for some businesses, it can actually be discriminatory against poor communities that don’t have as much access to banks or lines of credit,” said New Jersey State Senator Nellie Pou, who sponsored the state’s new law. Read more here-https://cnn.it/2USmtjW
-Sweden Seen Likely to Force Banks to Handle Cash Transactions. Sweden will likely push through a proposal to force banks to keep offering cash to customers who require it as the Nordic nation grapples with how to balance the rapid transformation into a cashless society. Key lawmakers said in interviews over the weekend that the government will probably seek to enact proposed legislation that had been roundly criticized by the banking industry and calledpotentially illegal. Olovsson is part of a committee that’s reviewing the central bank law, which proposed last year to make it mandatory for banks that provide checking accounts and have more than 70 billion kronor ($7.6 billion) in deposits from the Swedish public to offer cash withdrawals and handle daily receipts. The legislation is a response to Sweden becoming one of the most cashless societies in the world. Bloomberg
-Majority of bitcoin trading is a hoax, new study finds. Ninety-five percent of spot bitcoin trading volume is faked by unregulated exchanges, according to a study from Bitwise this week. The firm analyzed the top 81 crypto exchanges by volume on industry site CoinMarketCap.com. They report an aggregated $6 billion in average daily bitcoin volume. The study finds that only $273 million of that is legitimate. “People looked at cryptocurrency and said this market is a mess; that’s because they were looking at data that was manipulated,” says Matthew Hougan, global head of research at Bitwise. CNBC
-Jimmy Carter was the first US president to be born in a hospital. On Friday, he marks a new milestone as the oldest living former president ever. At 94 years and 172 days old, Carter has passed the previous record held by the late President George H.W. Bush. “He and Mrs. Carter take walks, and they have followed a healthy diet for a lifetime,” Deanna Congileo, a spokeswoman for the Carter Center, told CNN. “Both President and Mrs. Carter are both determined to use their influence for as long as they can to make the world a better place, and millions of the world’s poorest people are grateful for their resolve and heart,” she added. Read more here-https://cnn.it/2U0f7yo
-White House on Barr’s summary of Mueller findings: ‘Total and complete exoneration’ of President Trump. The White House celebrates the release of Attorney General William Barr’s summary of special counsel Robert Mueller’s report on the investigation into Russian interference during the 2016 campaign. “The findings of the Department of Justice are a total and complete exoneration of the President of the United States,” Sarah Huckabee Sanders says. When it comes to obstruction of justice, according to Barr: “The Special Counsel states that ‘while this report does not conclude that the President committed a crime, it also does not exonerate him.'” CNBC
–It’s official: Russiagate is this generation’s WMD. The Iraq war faceplant damaged the reputation of the press. Russiagate just destroyed it. Nobody wants to hear this, but news that Special Prosecutor Robert Mueller is headed home without issuing new charges is a death-blow for the reputation of the American news media. As has long been rumored, the former FBI chief’s independent probe will result in multiple indictments and convictions, but no “presidency-wrecking” conspiracy charges, or anything that would meet the layman’s definition of “collusion” with Russia.
With the caveat that even this news might somehow turn out to be botched, the key detail in the many stories about the end of the Mueller investigation was best expressed by the New York Times: A senior Justice Department official said that Mr. Mueller would not recommend new indictments. Attorney General William Barr sent a letter to congress summarizing Mueller’s conclusions. The money line quoted the Mueller report: The investigation did not establish that members of the Trump Campaign conspired or coordinated with the Russian government in its election interference activities. Read more here-http://bit.ly/2YpV1Mt
-For Local News, Americans Embrace Digital but Still Want Strong Community Connection. 71% of U.S. adults think their local news media are doing well financially; 14% have directly paid a local news source. Read more here-https://pewrsr.ch/2Yt1G8M
-Stormy Daniels’ ex-lawyer Michael Avenatti arrested for alleged $20 million extortion scheme against Nike, embezzling client’s money, defrauding bank. Celebrity lawyer Michael Avenatti was arrested on charges of trying to extort up to $25 million from Nike by threatening to reveal damaging claims about the sneaker giant. Avenatti also was charged in a separate federal case of embezzling a client’s money “in order to pay his own expense and debts,” and of “defrauding a bank in Mississippi.” Avenatti, who represented porn star Stormy Daniels in her lawsuits against President Donald Trump and his former lawyer Michael Cohen, was released on bond and predicted he will be exonerated. CNBC
-British Airways Plane Bound for Germany Accidentally Lands in Scotland. The flight on Monday seemed to go perfectly well, until passengers realized that their plane had landed in both the wrong city and the wrong country. The British Airways flight from London City Airport was supposed to head to Duesseldorf, Germany, but ended up in Edinburgh, the capital of Scotland. The airline said Monday the problem started when an incorrect flight plan was filed by WDL Aviation, which operated the flight on behalf of British Airways. Officials say the pilot followed the flight plan for Edinburgh, and that air traffic control officials also were following the same flight plan and saw nothing amiss. WDL aviation said it was trying to determine the cause of the “obviously unfortunate mix-up.” The flight was refueled and set off again, this time directly to Duesseldorf. Bloomberg
-Take a look at the world’s most expensive new car it just sold for $19 million. If you like flashy cars and have millions of dollars burning a hole in your pocket, you might have been excited to hear that Bugatti recently unveiled the most expensive new car ever made. Earlier this month, the French luxury sports car brand started showing off the new Bugatti La Voiture Noire, which has an eye-popping price tag of 16.7 million euros (nearly $19 million USD). Read more here-https://cnb.cx/2uwu8Zs
-$1.3M perfume enters race for world’s most expensive fragrance. An Emirati perfumery claims it has created the most expensive perfume in the world. Called Shamukh “deserving the highest” in Arabic and priced at a nostril-flaring $1,295,000 for three liters, its makers say it’s the product of three years of research and 494 perfume trials. It comes in an Italian Murano crystal bottle, which is adorned with a gold falcon, Arabian horses, roses and a globe, contains 3,571 diamonds 38.55 carats in total giant pearls, 2.5 kilograms of 18-karat gold and 5.9 kilograms of pure silver. What’s more, the bottle sits on a cushioned leather stand nearly two meters tall. Read more here-https://cnn.it/2FBslZw
-Champion-bred pigeon sells for $1.42 million at auction. That ain’t pigeon feed. Armando, a champion-bred racing pigeon from Belgium, sold at an auction over the weekend for a world record amount nearly $1.5 million. “Nobody expected this. No one,” auctioneer Jorge Ferrari, of Pigeon Paradise in Brussels, told Reuters. The previous record for a homing pigeon sold at auction stood at $425,000. Two Chinese millionaires engaged in a furious bidding war for Armando in the last hour of a two-week online auction, according to the Guardian. The gavel came down at $1.42 million. The winning bidder wasn’t named. Pigeon racing in China is a big sport with race purses in the seven figures. Read more here-https://nyp.st/2HVIj2q
-The amount of money that Americans are spending while intoxicated is sobering and they’re purchasing everything from cars to pets. A recent survey from personal finance website Finder.com found that 26 percent of Americans about 53.4 million people admit to shopping while under the influence of alcohol and collectively, Americans spent $39.4 billion on drunk purchases in the past 12 months, an increase from last year’s $30.43 billion. That means the average American drunk-shopper spent $736 while intoxicated over the last year.
Millennials spent the most on drunk purchases over the last year, averaging $1,047. Gen Xers spent an average of $469 drunk shopping and baby boomers $466. So what are people buying? The most popular booze-fueled purchase is food, according to the survey, with 52 percent caving in to their cravings. Shoes and clothes is the second most common drunk purchase at 43 percent, followed by cigarettes at 30 percent. Other things people admitted to paying for while intoxicated include gambling (28 percent) and narcotics (10 percent). CNBC
-New England Patriots tight end Rob Gronkowski retires from the NFL. Rob Gronkowski, the New England Patriots’ fun-loving, touchdown-spiking tight end announced he is retiring from the NFL. The four-time All-Pro posted his decision on Instagram, saying that a few months shy of his 30th birthday “it’s time to move forward and move forward with a big smile.” Read more here-https://cnb.cx/2HJ9JsS
-Rob Gronkowski is retiring from the NFL here’s the ‘broke habit’ he kept even while making $8 million. New England Patriots tight end Rob Gronkowski announced on Sunday that he’s retiring from football at age 29. The announcement means that Gronkowski will end his $54 million contract with the Patriots a year early. But even without collecting a paycheck, the football star will have plenty of money to fall back on: Gronkowski hasn’t touched a dime of this NFL salary or signing bonuses. Instead, he chose to live off of his endorsement money throughout his career. Read more here-
-Graff Adds 13ct. Lesotho Pink to Portfolio. Luxury jeweler Graff is preparing to cut and polish the exceptional 13.33-carat Lesotho Pink that sold for $8.8 million in February. The company revealed this week that it bought the stone from Gem Diamonds at a tender in Antwerp. At $656,933 per carat, the sale was the highest average price for any rough diamond recovered at the Letšeng mine in Lesotho, Gem Diamonds said last week without saying who the buyer was. The purchase comes amid a depletion of the world’s pink-diamond resources, as the mines that produce them become extinct, Graff explained. “This is the most vivid pink rough diamond I have ever seen, and it is an exceptionally rare treasure,” said Graff founder Laurence Graff. “I am sure the polished diamond that comes from this rough will be an auspicious addition to our roll call of famous gems.” Read more here-http://bit.ly/2upTIzv
-When Ben Affleck proposed to J.Lo with a six-carat colored diamond, he kicked off a craze for one of the world’s rarest diamonds.
Jennifer Lopez’s pink diamond engagement ring from Ben Affleck set off a craze for colored diamonds in 2002. Their engagement brought awareness to a category that is less plentiful and often more valuable than white diamonds.
Even before their engagement, fancy colored diamonds were prized by collectors, but Bennifer gave the rarefied diamond category a renewed spotlight and an increase in value.
While pink diamonds are rare, it turns out that red diamonds are the rarest of the colored diamond category and rarely come above one carat. Read more here-http://bit.ly/2WrttVb
-$50 Million Pink Legacy Diamond Rekindles Interest In this Rare Gem. High-end jewelers worldwide are anticipating a surge in interest in rare but exceedingly pricey “pink diamonds” following an auction in 2018 that set the world record price for this special gemstone. The fabulous “Pink Legacy” diamond weighing 19 carats and one of only a few pink diamonds in the world fetched a world record $50 million at auction at Christie’s Geneva in November 2018.
This widely covered media event has jewelers looking back to 2002 when Bennifer (remember them?) made their engagement official. Ben Affleck gifted ex-wife Jennifer Lopez with a 6.10 carat fancy intense pink diamond (radiant cut) engagement ring with white diamond side accents. This très chic diamond engagement ring magnified awareness about pink diamonds as must-haves in a market where less expensive but more abundant white diamonds held sway. Read more here-http://en.businesstimes.cn/articles/109758/20190325/50-million-pink-legacy-diamond-rekindles-interest-rare-gem.htm
–Twin-Stone Fancy Blue Diamond Ring Could Fetch US$8M. A twin-stone blue diamond ring will be the top lot at next month’s Christie’s New York auction, with a presale estimate of $6 million to $8 million.
The piece, bearing two pear modified brilliant-cut, fancy-vivid-blue, VS2-clarity diamonds weighing 3.06 and 2.61 carats, will go under the hammer at the Magnificent Jewels sale on April 16, the auction house said last week. Christie’s will also offer three D-color diamonds over 15 carats each, including a marquise-cut, 16.69-carat, potentially internally flawless, type IIa stone.
The diamond, which is from the collection of Elizabeth Stafford, duchess of Norfolk, is estimated at $1.2 million to $1.8 million. An oval modified brilliant-cut, 6.11-carat, fancy-pink diamond ring with VVS1 clarity will also be up for auction, with a presale estimate of between $1.2 million and $1.5 million. The stone is one of a number of colored diamonds on offer. Several yellow stones will go under the hammer, including a pair of fancy-deep-yellow earrings weighing 7.55 and 7.51 carats, which are valued at $700,000 to $1 million.
A 37.65-carat, fancy-intense-yellow diamond ring is estimated at $600,000 to $800,000, while a 35.06-carat, fancy-intense-yellow pendant will go up for $500,000 to $700,000. Other notable lots include private collections from Florence and Herbert Irving and the estate of Jean Tailer, and signed pieces by Bulgari, Cartier, Harry Winston, Jean Schlumberger for Tiffany & Co., and Van Cleef & Arpels. The auction house will preview the jewels between March 20 and April 15 in Los Angeles, Geneva, Hong Kong and New York. Read more here-http://bit.ly/2HG0HNc
-Blue Diamond to Lead Sotheby’s New York. A fancy-intense-blue diamond ring with an estimate of $2.5 million to $3 million is on track to be the top seller at Sotheby’s Magnificent Jewels auction in New York next month. The cut-cornered square modified brilliant-cut, 3.24-carat stone, flanked by two pear-shaped diamonds, will go under the hammer at the April 17 sale, Sotheby’s said Wednesday. Other notable pieces include a pair of round diamond earclips by Betteridge, each weighing 20.27 carats, which are valued at $1.3 million to $1.8 million. Additionally, a round, 30.40-carat white diamond ring by the jeweler, with an estimate of $900,000 to $1.1 million, will feature in the sale. Sotheby’s will also sell pieces from renowned jewelry houses, including Bulgari, Harry Winston, Graff, Cartier, Van Cleef & Arpels, and Tiffany & Co. The sale will precede Sotheby’s New York Fine Jewels sale, also on April 17, which will be led by a square emerald-cut, 3.38-carat, fancy-vivid-yellow diamond ring, accented by round diamonds. That piece carries a presale estimate of $60,000 to $80,000. Read more here-http://bit.ly/2UlOVhb
-Rare blue diamonds may be Earth’s deepest secret. The Hope Diamond, a rare blue diamond that is one of the world’s most famous jewels, has had a complicated history, passing through the hands of monarchs and bankers and heiresses and thieves before landing for all to see at a Washington museum. The geological history of blue diamonds is even more complex, according to research published on Wednesday examining these exceptionally scarce and valuable gems. Scientists analyzed 46 blue diamonds, including one from South Africa that sold for $25 million in 2016, and determined that they can form at depths of at least 410 miles (660 km), reaching into a part of the Earth’s interior called the lower mantle.
Tiny mineral fragments trapped inside them provided clues about the birthplace of the diamonds. Blue diamonds comprise only about 0.02 percent of mined diamonds but include some of the world’s most famous jewels. Diamonds are a crystalline form of pure carbon, forming under enormous heat and pressure. Blue diamonds crystallize alongside water-bearing minerals that long ago were part of the seafloor but were shoved to great depths during the inexorable movement of the immense tectonic plates that shape Earth’s surface, the researchers said.
Scientists already knew these diamonds acquired their blue hue from the element boron. This study indicated this boron once had been in ocean water and was incorporated into the seafloor rock that over millions of years moved deep underground. “This is the first time anyone has come up with a fact-based story or model for how blue diamonds form. Prior to this study we had no idea where they form, what kinds of host-rocks they form in, or where they might be getting their boron from,” said Gemological Institute of America research scientist Evan Smith, who led the study published in the journal Nature. Most diamonds are not completely colorless, often possessing slight yellowish tints.
Although rare, some even have prominent hues of, for example, yellow, brown, pink or green. About 99 percent of all diamonds form roughly 90 to 125 miles (150-200 km) underground shallower depths than the blue ones. Aside from the Hope Diamond, on display at the Smithsonian National Museum of Natural History, another blue diamond called the Oppenheimer Blue in 2016 sold for $57.5 million, at the time the highest auction price for any jewel. “These diamonds are among the deepest ever found,” Carnegie Institution for Science geochemist Steven Shirey said of the blue diamonds. Read more here-https://reut.rs/2Ynm9Mg
-How Diamonds Gain Color. Deformation, impurities, radiation many factors lend unexpected color to a diamond.
Q. What accounts for the color differences in diamonds?
A. In diamonds, unexpected colors may arise in a variety of ways. These include small and large inclusions of other elements in the crystal, physical deformation of the crystal lattice, radiation, or a combination of causes. All affect how a stone absorbs and reflects various wavelengths of light. The jeweler’s familiar range of colorless to yellow or yellow-brown diamondsdepends on distributions of nitrogen atoms, a connection that was not discovered until 1959.
The famous and rare blue diamonds, like the notorious Hope diamond, have varying quantities of boron atoms in their crystal lattices. But the intensity of color is only loosely correlated with the concentrations of boron. The even rarer pink and red diamonds owe their color to subtle physical shifts in the alignment of the crystal planes that happen as they are subjected to extreme heat and pressure as they rise from the great depths of the Earth. Radiation deforms some crystals, producing green diamonds. Purple diamonds result from both hydrogen inclusions and physical deformation. Read more here-https://nyti.ms/2Tu0QEV
-Biggest Bling Ever: $500,000 Watch With 15,000 Diamonds Sets Guinness World Record. If you like your diamonds set onto everyday objects or wearable art, then Coronet Jewelry is a company that should be on your radar. The diamond jewelry manufacturer, a division of Aaron Shum Jewelry of Hong Kong, introduced a watch at Baselworld last week set with 15,858 diamonds totaling 50.01 carats and valued at $500,000. It was inducted into the Guinness World Records in a ceremony at the fair. For those who aren’t in the market for quite that much bling, Coronet also introduced a watch collection of similar designs, set with fewer diamonds. Read more here-http://bit.ly/2YuLMKR
-The Great Diamond Shortage That Never Was Is Likely Coming Soon. For more than 15 years, the diamond industry has been telling the world about a looming shortage of gems. Instead, demand has been stubbornly underwhelming, and the miners have done a wonderful job of digging more and more stones. But the pain may soon be over for an industry that’s being squeezed by oversupply. In two separate reports this week, analysts set out forecasts of a tightening market in the next few years, with diamond supply falling into deficit in or around 2021. Bloomberg
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
–Palladium retreats nearly $100 after recent record highs largest one-day drop in 19 years. Palladium futures suffered Wednesday from their sharpest one-day dollar decline in more than 19 years, losing nearly $100 an ounce for the session to mark a significant retreat from a recent string of record settlements tied to an expected surge in auto-industry demand. The June contract for palladium futures dropped by $94.40, or 6.23%, to settle at $1,421.50 an ounce Wednesday on Comex. That was the largest one-day dollar decline since Feb. 23, 2000 and biggest single-session percentage drop since Jan. 25, 2017, according to Dow Jones Market Data.
The 6.23% fall surpassed the 6.21% daily drop seen on March 1, 2018. Just a week ago, futures prices for the most-active contract settled at a record $1,560.40. They’ve lost 8.9% since then. “The tighter emissions standards in Europe and elsewhere has led to part of the [recent] increase, but the Russia export restrictions have been the real driver,” Jeff Wright, executive vice president of GoldMining Inc., told MarketWatch. Prices for the metal have climbed four months in a row through February on tight supplies and expectations for strong demand from the automobile sector because palladium is mostly used in pollution-controlling catalytic converters on gasoline-powered vehicles.
“It does appear as if the palladium market is possibly seeing some selling interest from headlines touting the potential for ‘industrial rotation’ from palladium to platinum because of the recent differential of $700 between the two metals,” said analysts at Zaner Metals, in a daily note. Platinum is now much cheaper than palladium, and speculation that the industry may soon reach a point where it will be worth it to use platinum instead of palladium has grown. So far, Wright said he believes the metal “has had a normal correction, as demand while up is not dramatically up or changed.” However, more electric vehicles “will taper demand for palladium and long term, I am in lithium over palladium or platinum.” Read more here-https://on.mktw.net/2V2yUJW
-The Staggering Amount Of Gold & Silver Investment Since The 2008 Financial Crisis. While the demand for precious metals is certainly off its highs from prior years, investors would be quite surprised by the astonishing amount of physical gold and silver investment since the 2008 financial crisis. Only by comparing the gold and silver investment demand in the prior decade, can we truly understand how the precious metals market has changed, and probably forever. Read more here-http://bit.ly/2CGwTvQ
-How much gold and silver should you own? Great question. Gold, trading for more than $1,300 an ounce, is a much pricier investment than silver, which currently costs about $15 an ounce. In other words, you could purchase more than 40 ounces of silver for the same price as one-half ounce of gold. Investors treat gold more like a currency than silver, a metal that has many more industrial uses than gold. So if you want to buy silver, don’t necessarily expect it to perform in tandem with gold. Silver prices are actually down nearly 25% over the past five years while gold prices have been relatively flat. Silver has been hit harder, because investors are worried about slowing global economic growth. But both metals have underperformed the broader stock market.
Still, investing experts say that gold, silver and other precious metals like platinum and palladium, could make sense as a small part of a broader investment portfolio. Many people own them simply to hedge against big pullbacks in stocks. They are also viewed as a good alternative to government-backed currencies which tend to fluctuate more with central bank decisions on interest rates. Now that the US Federal Reserve is apparently done raising interest rates for the foreseeable future, that should bode well for gold and silver, when rates are low. “Metals are set to be primary beneficiaries of the Federal Reserve simply catching up to futures markets priced for easing.
Further hikes are unlikely,” said Bloomberg Intelligence senior commodity strategist Mike McGlone in a tweet Friday. But silver might be more attractive than gold right now and not just because it’s a heck of a lot cheaper to purchase. Many commodities analysts closely follow the ratio of the price of one ounce of gold to one ounce of silver. It’s flashing a buy signal. “Historically, there have been only a few occasions that the gold-silver ratio traded above 80,” said analysts at Blanchard, a precious metals investing firm in New Orleans, in a recent report. “The gold/silver ratio stands at 85 right now. That signals that silver is dramatically undervalued,” the Blanchard analysts said. Read more here-https://cnn.it/2TxyAkJ
-Lawrie Williams: Russia back on gold reserve track. Adds another million ounces. After two months of adding relatively small amounts of gold to its forex reserves, Russia appears to be back on track in adding 1 million ounces (31.1 tonnes) of gold to its reserves in February according to the latest figures from the country’s central bank. Russia, according to the IMF’s official statistics, moved ahead of China as the world’s fifth largest national gold holder in January 2018 and has extended its lead over China almost every month since at least as far as figures reported to the IMF suggest, although officially reported Chinese gold reserve figures are thought to substantially under-represent the true picture!
With the latest addition to its reserves, Russia holds around 2,144 tonnes of gold in its fores reserves as compared with China’s 1,862 tonnes. If the former keeps adding to its reserves at around 30 tonnes a month it could move ahead of France’s fourth placed 2,436 tonnes by the end of this year and surpass Italy’s 2,451.8 tonnes a month later! Whether this will then be sufficient to end the country’s gold reserve building exercise, or whether it will then have Germany’s 3,369.7 tonne gold reserve in its sights, remains to be seen. Russia has all but eliminated U.S. dollar related holdings from its reserve total as a defensive measure against current and potential U.S. economic sanction. It would appear that expanding its gold holdings, alongside other strong currencies in place of the dollar, is an integral part of its reserve diversification policy.
We commented in a post early last year citing one of the most accurate gold analysts, Dr Martin Murenbeeld that the U.S.’s aggressive foreign policy stance was likely to drive other central banks to increase gold reserves and reduce their dependence on the U.S. Dollar as a reserve currency to the long term detriment of the U.S. This has already come about with the Trump policies building resentment against the U.S. exerting its financial and military muscle in a perhaps unprecedented manner. According to the World Gold Council 2018 was comfortably the biggest year yet for global central bank gold purchases since President Nixon took the U.S. off dollar to gold convertibility in 1971. This has already confirmed Murenbeeld’s analysis. And 2019 could well be another year of strong gold purchases by central banks with Russia again leading the way. Read more here-http://bit.ly/2OBmZk5
-Greg Hunter: Jim Rickards Interview, Fed Can’t Get Out Buy Gold Now. On gold, Rickards says, “People always say there is not enough gold to support commerce and trade and the money supply. I always remind them that is nonsense. There’s always enough gold, it’s just a question of price. At the current level of around $1,300 per ounce, that’s too low. What price does (support commerce and trade)? So, if you take supply and say back it by 40%, divide by 33,000 tons, that comes to $10,000 per ounce. Could it be higher? Sure if you used a larger money supply, you would need a higher price.
If you would use a larger percentage that would be a higher price. If you do that math, you can get to $40,000 per ounce easily. I want to make this clear. These are actual calculations based on actual numbers that are publicly available for money supply. It’s not made up. It’s not science fiction. It’s just a simple question. If you wanted to go to a gold standard today without causing deflation, given the amount of gold and given the amount of money, what would the price have to be? The answer on some very conservative calculations would be $10,000 per ounce.
The time to buy gold is when sentiment is low and people hate it. So, the bull market is intact.” We are in the fourth year. Bull markets start off slow because of all the bad sentiment, but then they gather momentum. So, it’s still not too late to jump on this train, and my expectation is this will pick up. The signal the gold market is getting right now is the Fed is throwing in the towel. They made some headway, but it came at a high cost because they slowed the economy and they can’t continue. Now, they are going to be desperate for inflation, and that is very bullish for gold.” Read and watch more here-http://bit.ly/2TJv2w8
-Mike Maloney: Silver Bullion Is Cheaper Than DIRT. Listen here-http://bit.ly/2Uh8A1u
-Jim Cook Interviews Ted Butler. Read more here-http://bit.ly/2OsxohO
Q: A minor analyst recently remarked that he didn’t believe any of the claims you make about market manipulation and called it conspiratorial stuff. What do you say about that?
A: That’s the main reason my arguments have never caught on in a big way. Nobody wants to be associated with a conspiracy. However, I draw my conclusion from government data like the Commitment of Traders report and the Bank Participation report. There’s nothing conspiratorial about the data and my conclusions are factual.
Q: You have cast JPMorgan as the main villain in a market manipulation of silver. Hundreds, maybe thousands of people have queried the main regulator, the CFTC, about this manipulation and they have never responded to anyone. Are they writing us all off as conspiracy nuts?
A: They would probably like to. The Justice Department just indicted a JPMorgan trader for spoofing and indicated their investigation of this highly manipulative tactic was ongoing. Normally this comes under the jurisdiction of the CFTC. Why did they miss or ignore this practice when I told them about it a hundred times? We need an explanation.
Q: JPMorgan would certainly claim they are doing nothing wrong.
A: For ten years they have held the largest short position on the COMEX and in collusion with other banks, they have acted to suppress the price. Meanwhile they have accumulated a vast hoard of physical silver in their own COMEX warehouse and elsewhere. I call this an illegal market manipulation on steroids. Somebody please tell me where I’m wrong.
Q: I believe JPMorgan would say that they are short along with hundreds of other traders. Nothing wrong with being short and nothing wrong with buying physical silver.
A: First of all, you have great concentration among 8 big banks on the short side. That’s collusion and a key ingredient in a price manipulation. These 8 banks are currently short more than 500 million ounces or two-thirds of all the silver produced in a year. No other commodity comes close to this.
-U.S. Silver Production The Lowest In More Than 70 Years. With the latest release by the USGS, silver production in the U.S. is now the lowest in more than 70 years. We have to go all the way back until the year after World War II ended to see U.S. silver production less than it was in 2018. While many reasons can be attributed to the decline, the main factors are falling ore grades and mine economics. Unfortunately, there just aren’t too many economic silver deposits in the United States, especially with the high level of environmental and governmental regulations. Instead of dealing with all the bureaucracy, companies are looking to Mexico and South America to open new silver projects. Read more here-http://bit.ly/2HJLX02