The World Financial Report

World Financial Report – March 7th, 2019

Radio Show Newsletter

WORLD FINANCIAL REPORT ON RADIO MARCH 7th 2019
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CHARTS OF THE WEEK-QUOTES-QUICK HITS

-CHART OF THE WEEK: Realtors Plead for Looser Mortgages as Toronto Sales Drop Again. Toronto’s housing market posted its biggest monthly sales decline in a year last month, prompting the city’s realtor board to call for a review of new mortgage rules it says are keeping buyers on the sidelines. Sales fell 7.7 percent on a seasonally adjusted basis to 6,212, the largest decline since February 2018, the Toronto Real Estate Board reported Tuesday. Benchmark prices, which adjust for the type of home sold, climbed 0.8 percent from the prior month to C$767,800 ($576,400).

The decline in transactions so far this year extends 2018’s losses which were the worst in a decade, leading to speculation policy makers went too far when they added stress tests to mortgage-lending requirements. The regulator that imposed the rules the Office of the Superintendent of Financial Institutions should review them, and amortization periods for federally insured mortgages should be extended to 30 years to give buyers a break, the real estate board said. “The OSFI mandated mortgage stress test has left some buyers on the sidelines who have struggled to qualify for the type of home they want to buy,” Gurcharan Bhaura, TREB’s president, said in a statement. “There is a federal budget and election on the horizon. It will be interesting to see what policy measures are announced to help with home ownership affordability.” Bloomberg

-CHART OF THE WEEK: As Wall Street Frets, Mom and Pop Dip Toes Back Into Stocks. Trade hopes. Fed doves. Earnings growth. Whatever the reason, investors on Main Street appear ready to go where many on Wall Street still fear to tread. The latest data from TD Ameritrade suggest mom and pop increased their exposure to U.S. equity indexes for the first time in five months in February. They continued to move away from single stock exposure, even as share-picking strategies outperformed in the late cycle environment. The signal is weak retail investors remained net equity sellers overall but suggests emerging confidence that the broad rally may have room to run. That’s a stark contrast to the actions of the so-called fast money, which has remained stubbornly contemptuous of the 2019 gains. “They think the market’s going higher, but because of the uncertainty of tariffs, they don’t necessarily want to pick individual winners and losers,” Joe “JJ” Kinahan, the chief market strategist at TD Ameritrade, said by phone. “They’re much bigger buyers of the overall market than they are of the individual equities.” Bloomberg

-CHART OF THE WEEK: U.S. Trade Gap Surged to $621 Billion in 2018, 10-Year High. The U.S. trade deficit widened in 2018 to a 10-year high of $621 billion, bucking President Donald Trump’s pledges to reduce it, as tax cuts boosted domestic demand for imports while the strong dollar and retaliatory tariffs weighed on exports. The annual deficit in goods and services increased by $68.8 billion, or 12.5 percent, Commerce Department data showed Wednesday. The December gap jumped from the prior month to $59.8 billion, also a 10-year high and wider than the median estimate of economists. The merchandise-trade deficit with China the principal target of Trump’s trade war hit a record $419.2 billion in 2018. Bloomberg

-CHART OF THE WEEK: Euro Could Plunge to $1.05 If Chinese Gloom Grows. The euro could weaken to levels last seen in early 2017 if China’s economic slowdown persists, according to Stephen Jen, chief executive officer of Eurizon SLJ Capital. Jen said the common currency could slump to $1.05 later this year if stress emanating from China bleeds further into Europe’s economy and prevents the European Central Bank from normalizing policy, while the U.S. “continues to outperform.” Fiscal stimulus and slowing structural reforms in China probably won’t be sufficient to spark a “V-shaped recovery” in the first half of 2019 for the Asian nation, according to Jen. Europe’s “manufacturing and the tradables sector are clearly exhibiting stress, arising in part from the shock from China,” the London-based hedge fund manager wrote in a note Friday. “If I am right that the Chinese economy will remain weak, Europe and the ECB will remain under pressure.” Bloomberg

-CHART OF THE WEEK: U.S. Credit Card Debt Closed 2018 at a Record $870 Billion. U.S. credit card debt hit $870 billion the largest amount ever as of December 2018, according to the data from the Federal Reserve. Credit card balances rose by $26 billion from the prior quarter. “The increase in credit card balances is consistent with seasonal patterns but marks the first-time credit card balances re-touched the 2008 nominal peak,” according to the report. Nearly 480 million credit cards are now in circulation up by more than 100 million since hitting bottom after the recession a decade ago. At the end of last year, credit cards were the fourth-largest portion of consumer debt in the U.S. after mortgage, student loan and auto debt. But the quarterly increase in credit card debt was faster than the other categories. Overall debt reached a record $13.5 trillion. Bloomberg

-CHART OF THE WEEK: Widening Russia Money Laundering Scandal Hits European Banks. More European banks are being drawn into money-laundering allegations centered on dirty Russian money, adding to the scandal in an industry still recovering from the financial crisis. Initially centered on Danske Bank A/S in Denmark and Sweden’s Swedbank AB, allegations of suspicious transfers widened this week to include Raiffeisen Bank International AG in Austria and several Dutch institutions. Danske has lost half its market value since admitting its role in a money laundering scandal in 2016.

The disclosures describe a network of banking relationships that was used to export funds from criminals in the former Soviet Union to western nations, often via Estonia and Lithuania. Investigations are under way in the Baltic nations, the U.S., the U.K. and the Nordic countries, but almost daily revelations suggest there are more surprises to come on the scale of the misconduct. Raiffeisen Bank International AG led declines in European banking shares on Tuesday slumping as much as 15 percent after Bill Browder’s Hermitage Fund said the bank ignored warning signs that would have helped stop the laundering of funds from Russian criminal activity. Dutch banks fell after a report that the three largest were used to move cash from Russia. Bloomberg

10 years ago this week, the market hit the climactic bottom of the Great Recession. The index has delivered a 10-year annualized total return of 17.8 percent since its financial crisis bottom in March 2009, matching the annual gains 10 years after the 1987 crash and the August 1982 bottom. When the trailing 10-year return gets up to this area, it typically means a bull cycle is far along, but hasn’t generally marked its end. Still, many professional and individual investors have been reluctant to embrace the 2019 comeback as gauged by sentiment surveys, fund flows and hedge-fund positioning. CNBC

-The US just officially hit the debt ceiling, setting up another high-stakes showdown for the fall. As of Saturday, the US has officially hit the debt ceiling, capping the national debt at just over $22 trillion. And while the deadline to raise the ceiling is still a few months away, analysts are already worried about a fight that could get ugly. Congress suspended the debt ceiling for a year in February 2018, which allowed the US to rack up new debt until the limit was reimposed on March 2. While the country can’t add to the debt load until the ceiling is either raised or suspended by Congress, the Treasury Department can use its “extraordinary measures” to move funds around and prevent a breach of the ceiling for a few more months. According to a report released on Tuesday by the Congressional Budget Office, the Treasury will exhaust the ability to extend the deadline until sometime in late September or early October. The exact date is uncertain this far out because of the variability of tax receipts and potential federal spending. Businessinsider

-The U.S. budget deficit widened to $310 billion in the first four months of the fiscal year, underscoring the revenue hit from Republican tax cuts and an increase in government spending. The budget gap widened 77 percent compared with the same October-January period a year earlier, according to the Treasury monthly budget report released on Tuesday, which was delayed by the government shutdown. Receipts fell by 2 percent to $1.1 trillion, while spending rose 9 percent to $1.4 trillion. The budget received a bump in customs duties, which almost doubled to about $25 billion, reflecting the Trump administration’s tariffs on Chinese imports, steel and other goods.

The financial shortfall is set to widen further in the coming years as the Republican tax cut package, which costs about $1.5 trillion over a decade, and increased spending for defense and other priorities boost government outlays. Some policy makers and economists are flagging concern about the growing debt burden, saying it risks America’s credit quality among borrowers, while other economists see more room to run. Tax receipts fell for both corporations and individuals, the Treasury data showed. The Congressional Budget Office, a non-partisan federal agency, forecast earlier this year that the budget gap in the fiscal year through September would widen to $897 billion, up by $118 billion from a year earlier. In January, the U.S. posted a budget surplus of $8.7 billion, the smallest gain for the month since a shortfall of $17.5 billion was recorded in 2015, according to Treasury data. Bloomberg

Bank of Canada holds interest rate steady but some suggest a rate cut could be back on the table. Canada’s central bank has decided to keep its benchmark interest rate at 1.75 per cent, and says the timing of possible future hikes has become increasingly uncertain. The Bank of Canada says the economic slowdown that began at the end of last year is a bit worse than it was expecting, including a sharper-than-anticipated slowdown in Canada’s oil patch. The bank also singled out softness in the housing market and consumer spending as reasons for a gloomier outlook. “It is clear that global economic prospects would be buoyed by the resolution of trade conflicts,” the bank said. “With increased uncertainty about the timing of future rate increases, [the bank] will be watching closely developments in household spending, oil markets, and global trade policy.” The bank meets eight times a year to set its interest rate, which filters down into the rates that Canadians get on things like savings accounts and mortgages. CBC

-The bad news just keeps coming for Canadian Prime Minister Justin Trudeau. Confidence among consumers remains sluggish well below the 12-month average on widespread expectations the economy will stagnate or weaken, telephone polling shows. Canadians are more confident in their job security than they have been in years, but that hasn’t extended into better personal finances or optimism about the housing market. Trudeau is in an election year and Canada’s economy is stumbling, as data released Friday showed that gross domestic product essentially stalled last quarter. The Canadian prime minister is already dealing with a controversy over whether he tried to end a court case against SNC-Lavalin Group Inc. to prevent job losses a saga that has already cost him a cabinet minister and his principal secretary.

The economy, stuck in neutral, presents another risk that would be exacerbated if there was any further slowdown. “Under normal circumstances, it would feed grumpiness. In the current environment, any kind of downturn would be even more of a problem for the Liberals,” pollster Nik Nanos said. The Bloomberg Nanos Canadian Confidence Index rose slightly to 55 to begin the month, from 54.2 a month earlier. It remains below the 12-month average of 55.9, and hasn’t topped that level since November. Just 13.9 percent of Canadians expect the economy to strengthen in the next six months, versus 32.9 percent who expect it to weaken. Bloomberg

-The national delinquency rate on Canadian consumer debt stayed little changed in the fourth quarter, though there were still signs of deterioration, according to the country’s largest credit reporting firm. Across all age groups, the national delinquency rate on debt excluding mortgages rose to 1.07 percent, an increase of 0.4 percent compared with the same quarter a year earlier, Equifax Canada said in a report Tuesday. The rate fell or was flat in the youngest age groups, those between 18 and 55, while it increased for those older than 56.

Bill Johnston, vice president of data and analytics, said the marginal increase in the national delinquency rate is masking underlying weakness in the country’s credit markets. He pointed to the third straight year-over-year increase in late payments for seniors, as well a trend of late payments in auto loans and leases. The delinquency rate is up from the previous quarter’s 1.05 percent, which was the lowest since at least 2013, the data show. The rate had been declining on a year-over-year basis since the end of 2016. “The overall delinquency rate was up very marginally, but you’re starting to see it getting a little bit broader,” Johnston said by phone from Toronto. Bloomberg

-Canada is on recession watch after its economy almost stalled at the end of last year. Gross domestic product grew by just 0.1 percent in the fourth quarter, or 0.4 percent annualized, Statistics Canada said Friday. It’s a weak enough number that could easily be revised into a contraction as new data come in. And there may be no immediate relief to start 2019. Most economists have been expecting the first three months of this year will be even weaker, because of the impact of oil production cuts mandated by Alberta’s government.

While the slowdown was expected, the picture is much bleaker than anyone anticipated with weakness extending well beyond the battered energy sector reflecting a confluence of headwinds from the impact of higher interest rates to global trade tensions denting business and household confidence. Though the labor market is still quite strong, Friday’s numbers suggest Canada may have few reserves to weather any new shocks. “Judging by the employment numbers, we’re not close to a recession but we’re in a sluggish growth environment where one more piece of bad news that isn’t currently out there could certainly send us there,” Avery Shenfeld, chief economist at CIBC Capital Markets, said in a telephone interview. Bloomberg

-After a generation in the workforce Canadian women directly control a large chunk of Canadian financial assets about $2.2 trillion, according to a new study from CIBC. That wealth figure doesn’t include the family home. Women will manage an increasing concentration of investable assets to 2028, as the baby-boom generation moves into its senior years, and the women continue to outlive the men by about six years. This generation of women have more money because they’ve been in the workforce most of their lives, but also because more of them are taking control of financial decisions, the study found. “What that comes from is labour market progress on the part of women. Women are also increasing their employment in higher paying occupations, and the wage gap is shrinking,” says CIBC economist Katherine Judge. “And women who are married are contributing a record 47 per cent of the family’s income, so those labour market gains have contributed to greater wealth for females in general,” she told CBC News. CBC

-The delay to Enbridge Inc.’s Line 3 crude oil pipeline expansion hammered shares of Canadian oil-sands producers including Cenovus Energy Inc., MEG Energy Corp. and Canadian Natural Resources Ltd. as investors grappled with the prospect of another year of shipping bottlenecks. Cenovus fell as much as 7.5 percent in Toronto, and Canadian Natural slipped as much as 6.5 percent, the biggest intraday drops in almost three months for both stocks. MEG declined as much as 7.2 percent. Those three companies are among the producers most exposed to Canadian oil prices, which may take a hit as drillers struggle to get their crude to market, Michael Loewen, an analyst at Bank of Nova Scotia, said in a note to investors. Still, the postponement will likely affect all Canadian oil products, he said. “Ultimately, the delay of this project is an additional 12-month headwind for the Canadian energy sector,” Loewen said. Bloomberg

-China has set its GDP growth target for 2019 at 6 percent to 6.5 percent, as part of its announcement of major economic targets ahead of its annual legislative meeting in Beijing. Its defense budget growth target was set at 7.5 percent, lower than the 2018 growth target figure of 8.1 percent. Bloomberg

-Hayman Capital’s Kyle Bass predicts US interest rates will head back to zero in 2020. Hayman Capital’s Kyle Bass expects interest rates will head back to near zero in 2020. He also expects the U.S. to suffer a minor stock pullback during the same period. CNBC

-Buybacks and ETFs are moving the market as investors shy away from single stocks. U.S. investors were net sellers of U.S. equities for the second straight week as single-stock sales totaled $1.481 billion between Feb. 25 and March 1, Bank of America Merrill Lynch data show. The S&P 500 registered its ninth weekly gain in 10 last week despite the outflow, adding to its sharp gains this year and since the massive fourth-quarter sell-off. CNBC

-The gap between cheap and expensive stocks is the widest in 70 years. The valuations spread between cheap stocks and expensive stocks is at its widest in 70 years, according to AB Bernstein. Value, as an investing style, tends to outperform when dispersion is wide and there have been downward earnings revisions, says Bernstein’s Inigo Fraser-Jenkins. Bernstein said investors could buy cheap individual stocks in different sectors, or they could buy stocks that are “cheap per unit fundamentals,” their so-called “residual value factor.” CNBC

-Goldman Sachs preaches caution on commodities: ‘They are no longer significantly undervalued.’ Goldman Sachs warns this year’s commodity rally may soon run out of steam, saying investors need to monitor fundamental supply and demand data. Oil could hit $70 to $75 per barrel in the near term, but Goldman sees the commodity coming under pressure in the second half of 2019. Demand signals in the metals market are “relatively soft,” but investors can potentially profit from finding relative value within the sector. CNBC

-Ex-Obama advisor Larry Summers rips ‘dangerous’ economics backed by Ocasio-Cortez and other Dems. Advocating the government print money without worrying about the bills is a dangerous approach being pushed by far-left Democrats, economist Larry Summers says. “I don’t think this is a realistic calculus,” argues Summers, blasting ideas backed by Rep. Alexandria Ocasio-Cortez and Sen. Bernie Sanders. CNBC

-Billionaire Sam Zell: Ocasio-Cortez-style wealth redistribution won’t work Americans don’t want handouts. “Everyone in America wants to be rich. Everybody in America wants to succeed,” Zell says, but adds Americans want to earn success. “Redistributive policy leads to inequality. It’s just the opposite of what you think,” argues Zell. Zell says wealth disparities exist everywhere, but he believes the U.S. is one of the world’s most equal economies. CNBC

-Thomas Sowell warns U.S. may not resist siren song of socialism: ‘I wouldn’t bet on it.’ Thomas Sowell, a living legend in the field of economics, says he fears the U.S. may eventually succumb to the siren song of socialism. The author of “Basic Economics,” “The Vision of the Anointed,” “The Quest for Cosmic Justice” and numerous other books said the U.S. may very well go down a path of financial ruin due to “wonderful-sounding” rhetoric. Mr. Sowell, a Marxist in his youth, made the remarks Tuesday while appearing with Fox Business Network’s David Asman. “I do have a great fear that, in the long run, we may not make it,” Mr. Sowellsaid. “I hate to say that. The one thing that keeps me from being despairing is that we don’t know. There are so many things that we can’t possibly know. And so, we may make it, but I wouldn’t bet on it.” The author said that time and time again, people adopt willful ignorance regarding socialism’s track record around the world. Read more here-http://bit.ly/2UjBBq9

-Private payrolls up 183,000, but Moody’s economist says jobs may have peaked. Private payrolls rose by 183,000 in February, around Dow estimates of a 185,000 gain, according to ADP and Moody’s Analytics. January’s count was revised up sharply, from an initially reported 213,000 to 300,000. Moody’s economist Mark Zandi says payrolls may have reached their “high watermark.” CNBC

-Rents have increased for Americans nationwide. A report put average monthly rent for January at $1,420, a year-over-year increase of over 3 percent, and noted that, in 93 percent of the country’s 250 largest cities, rents have gone up since 2018. Over the past 10 years, the average rent for a new apartment has gone up by 28 percent. Meanwhile, wages have mostly remained stagnant: From 1999 to 2014, middle-class incomes shrunk in nearly every U.S. state. So, in many places, residents must work long hours to keep up on rent.

To find where workers must put in the most hours to pay for housing, financial website SmartAsset used data from the U.S. Census Bureau to analyze median rent in the U.S.’s 25 biggest cities, as well as residents’ post-tax median annual income and the number of hours worked per year. To get the average number of work hours needed to pay rent, “we divided average annual take-home pay by average hours worked per year,” says SmartAsset. “We then divided the monthly median rent by the average hourly wage.” Based on that data, here are the top 10 cities where residents must work the largest number of hours each month just to pay rent. CNBC

-Dollar Tree to close up to 390 Family Dollar stores, reports $2.3 billion loss. Dollar Tree plans to close 390 Family Dollar stores this year while renovating 1,000 other locations. About 400 stores will get expanded freezer and cooler sections, and it will also rebrand about 200 Family Dollar stores to the Dollar Tree. The company took a $2.73 billion charge against its Family Dollar business during the fourth quarter. CNBCCNN

-Abercrombie is planning to close up to 40 stores in 2019. Abercrombie & Fitch is planning to close up to 40 stores during fiscal 2019, primarily targeting U.S. locations. In fiscal 2018, it closed 29 stores. Over the last eight years, the teen retailer has shuttered about 475 stores. CNBC

-It’s lonely at the top. That’s what the Blockbuster in Bend, Oregon, discovered when the only other store in the world located in Australia announced it was closing. Although Sandi Harding, the general manager of the Oregon Blockbuster, is excited that the hers is the last Blockbuster on the planet, she expressed her condolences for friends at the Australia store. “We all have a kinship with the other Blockbusters,” Harding told CNN. The Oregon location has been open for more than 20 years. It offers customers the newest movie releases, but Harding says the classic older titles are the store’s “bread and butter.” “You can go to Redbox and you can get the new titles, but they don’t have the older ones,” Harding said. “Netflix and Amazon don’t have everything, either.” CNN

-China’s Xinhua state news agency on Sunday used a lifelike robotic news anchor that mimics human facial expressions and mannerisms to present a story about delegates attending an annual parliament meeting arriving in Beijing. The artificial intelligence robot named “Xin Xiaomeng” sported a short haircut and wore a pink blouse and earrings in a one-minute video presentation by Xinhua. Xin Xiaomeng is modeled after real life Xinhua news anchor Qu Meng and was developed by Xinhua and tech firm Sogou Inc. Xinhua displayed two AI news anchors dressed in men’s clothes last November at the World Internet Conference in the eastern Chinese town of Wuzhen. China is pushing to advance its prowess in AI technology, from surveillance equipment to self-driving cars. Reuters

-Tom McGregor: Actually, China’s social credit system isn’t the first. And we ought to expect even more countries to use behavioural economics to nudge good citizen behaviour. Western media reports have swirled about China’s social credit system, which is intended to nudge Chinese citizens to adopt good behaviour, including motivating them to pay outstanding debts and fines, as well as encouraging them to obey the country’s laws and regulations. China’s social credit system operates on a points system.

If you are a law-abiding citizen who pays your dues in a timely manner, the government rewards you with welfare benefits, low interest rates on loans and more. But criminals, delinquents, and those who are default on debts, as well as those indicted for bad behavior when traveling overseas will have lower social credit rankings and be marked as having a “delisted” status. “Discredited” Chinese citizens face greater scrutiny from the public, meet tougher challenges when applying for new credit cards, getting bank loans and in more severe cases, may be blocked from buying airlines or train tickets, until they repay their outstanding debts and fines. Read more here-http://bit.ly/2C78gbr

-What if you could make money, or type something, just by thinking about it? It sounds like science fiction, but it might be close to reality. In as little as five years, super smart people could be walking down the street; men and women who’ve paid to increase their intelligence. Northwestern University neuroscientist and business professor Dr. Moran Cerf made that prediction, because he’s working on a smart chip for the brain. The average IQ of an intelligent monkey is about 70, the average human IQ is around 100, and a genius IQ is generally considered to begin around 140. People with a smart chip in their brain could have an IQ of around 200, so would they even want to interact with the average person? Approximately 40,000 people in the United States already have smart chips in their heads, but those brain implants are only approved for medical use for now. Read more here-https://cbsloc.al/2H0d3zr

-If you’ve ever used an electric hand-held calculator in your life, you can thank Jerry Merryman for helping make your math life easier. Merryman who along with two other men invented the little contraption that changed computing forever has died at age 86. His wife, Phyllis, confirmed the death to CNN on Wednesday. She said Merryman died February 27 after a brief illness. He had been hospitalized since late December following complications related to pacemaker surgery, the wife said. Read more here-https://cnn.it/2NMpSxG

-The U.S. has deployed a highly advanced missile defense system in Israel for the first time, the American and Israeli militaries announced Monday, reflecting their shared concerns about Iran’s development of powerful missiles. Prime Minister Benjamin Netanyahu hailed the deployment of the Terminal High Altitude Area Defense system, or THAAD, as a testament to the strength of the two countries’ military ties, saying that it makes Israel “even stronger in order to deal with near and distant threats from throughout the Middle East.”

Israel already has an advanced multi-layered missile defense system, capable of intercepting everything from advanced guided long-range missiles outside the atmosphere to short-range unguided rockets fired from neighboring Gaza. During this week’s drill, the THAAD battery, which shoots down long and intermediate range missiles, will bolster Israel’s existing systems. The deployment is temporary, and for now, the THAAD system will not be permanently integrated into the Israeli defense shield, Conricus said. The U.S. military echoed said the deployment demonstrates the United States’ “continued commitment to Israel’s regional security” and more broadly shows that U.S. forces can “respond quickly and unpredictably to any threat, anywhere, at any time.” Read more here-http://bit.ly/2Tz9Qg7

-Mark Zuckerberg had a rough 2018. Facebook was plagued by scandal and data breaches, and Zuckerberg’s wealth shrank along with his company’s fortunes. The Facebook CEO’s net worth fell by $9 billion. He slipped three places on the Forbes 2018 global billionaires list, which the publication released Tuesday. The magazine now estimates Zuckerberg’s net worth to be $62.3 billion down from $71 billion last year. Facebook (FB) had a brutal 2018: The company was battered with data breaches and multiple government investigations into its practices.

Its stock lost more than a fifth of its value. Zuckerberg’s wealth is tied to Facebook’s performance because he owns nearly 17% of the stock, according to Forbes. -The top three people on the list were unchanged compared to last year. Amazon (AMZN) founder Jeff Bezos, whose wealth rose $19 billion from 2018 to $131 billion to this year, is in first place. Microsoft (MSFT) co-founder Bill Gates landed in second place, with his net worth rising to $96.5 billion this year from $90 billion last year. In third place is billionaire investor Warren Buffett. His net worth slipped $1.5 billion to $82.5 billion.

Only two people in the top 20 of the list are women. The granddaughter of LOreal’s founder, Francoise Bettencourt-Meyers, is in 15th place with $49.3 billion. Alice Walton of the Walmart (WMT) family in 17th place with $44.4 billion. Forbes said that the number of billionaires shrank for only the second time in a decade, citing last year’s tumultuous stock market and slowing global economy. The total combined net worth for its billionaires shrank $400 billion to just $8.7 trillion. Nearly 250 people dropped out of the list, which was the most since 2009 at the height of the Great Recession. CNNMoney

-Trump rises 51 spots on Forbes billionaires list but his net worth stays flat at $3.1 billion. President Donald Trump rises 51 spots in Forbes’ annual ranking of billionaires, the magazine reports. His net worth remains the same since last year, valued at $3.1 billion. Trump still refuses to publicly release his tax returns, which would reveal details about income from his business interests. CNBC

-$1.5 billion Mega Millions jackpot is claimed in South Carolina. Lottery officials announced that a South Carolina resident had stepped forward to claim the $1.5 billion Mega Millions jackpot from last October. It was the largest jackpot payout to a single winner in U.S. history. The winner elected to remain anonymous. CNBC

-Apple’s iPhone glass supplier says foldable phones should be ready in a few years. Apple’s iPhone glass supplier Corning is testing flexible glass as Samsung and Huawei roll out their first foldable phones. So far, the foldable phones that will soon be available rely on plastic-based displays and cost around $2,000. Corning’s testing hints Apple could have its eye on a foldable iPhone model with a more durable display than what competitors have shown so far. CNBC

-Christie’s plans to announce it will offer the 1964 work, “Buffalo II,” at a May 15 auction in New York, with an estimate of $50 million. That’s almost triple the late artist’s auction record and 300,000 percent more than what the original buyers paid for the collage-like canvas, which depicts President John F. Kennedy and was completed shortly after his assassination. “Everyone has been waiting for this painting,” said Sara Friedlander, Christie’s international director and head of its postwar and contemporary art department in New York. “It’s the very best of the silkscreen paintings that’s left in private hands.” It’s part of a collection of Robert and Beatrice “Buddy” Mayer, an heiress to the Sara Lee fortune who died in Chicago in September.

Christie’s will offer more than $125 million of Mayer’s works, including Roy Lichtenstein’s 1962 “Kiss III,” estimated at $30 million, among a group of Pop art. There are also Impressionist and modern art, Chinese ceramics and Latin American paintings. The Mayers bought “Buffalo II” from legendary art dealer Leo Castelli, who represented Rauschenberg at the time, for $16,900. The upcoming sale could reset the market for the artist, whose auction prices have lagged behind contemporaries such as Jasper Johns. The auction record for Rauschenberg, who died in 2008, is $18.6 million. Johns’s “Flag” sold for as much as $36 million at auction in 2014. Bloomberg

-At $12.5 Million This Bugatti Is the Most Expensive New Car Ever. For its 110th anniversary, Bugatti has created a jet black rocket it hails as the most expensive car of all time. It wouldn’t look out of place as Star Wars villain Darth Vader’s preferred mode of transport. “La Voiture Noire” is priced at 11 million euros ($12.5 million), which would buy about 300 Tesla Model 3s. The one-time vehicle has already been sold and speculation points to former VW Chief Executive Officer and Chairman Ferdinand Piech as the new owner. Piech was known for his tough leadership style before quitting the brand’s parent Volkswagen AG in acrimony in April 2015. Bloomberg

-Scotch whisky revealed to be best 10-year investment with whopping 582% return. Whisky has been named one of the most lucrative items of the decade in a wealth report on valuable investments. Rare Scotch topped investor Knight Frank’s luxury index after reporting 40% annual growth, outstripping cars, watches and even diamonds. It is the first time the report has included the Rare Whisky 100 Index a list of the worlds’ 100 most valuable bottles. Knight Frank said it saw one bottle set a new world record price of £700,000 in October, only to be beaten one month later by an even more sought after edition. In November, a bottle of Macallan 1926, hand painted by Irish artist Michael Dillon, sold for a record £1.2 million. Overall, Knight Frank said whisky has seen a 582% increase in value since 2009. Read more here-http://bit.ly/2H612bD

Most valuable investments in the past decade

  1. Art: Portrait of an Artist (Pool with Two Figures) by David Hockney. Sold by Christie’s for $90 million. Most expensive work by a living artist.

  2. Whisky: A bottle of The Macallan 1926, hand painted by Michael Dillon. Sold by Christies for $1.5 million. Most expensive bottle of whisky.

  3. Jewellery: The Marie Antoinette pearl pendant. Sold by Sotheby’s for $36 million. Most expensive piece of pearl jewellery sold at auction.

  4. Watch: 1970 Rolex Daytona “Unicorn”. Sold by Phillips with Bacs & Russo for $5.9 million. Most expensive watch sold at auction in 2018.

  5. Classic cars: 1962 Ferrari 250 GTO. Sold by RM Sotheby’s for $48.4 million. Most expensive car sold at auction.

  6. Wine: Bottle of 1945 Romanée-Conti. Sold by Sotheby’s for $558,000. Most expensive bottle of wine sold at auction.

  7. Stamps: 1918 Jenny Invert 24 cent. Sold by Robert A. Siegel Auction Galleries for $1.6 million. Most expensive US stamp sold at auction.

  8. Coins: 1621 Polish gold 100 ducat. Sold by the Classic Numismatic Group for $2.2 million. Most expensive Polish coin.

  9. Coloured diamonds: The Winston Pink Legacy, 19-carat fancy vivid pink diamond. Sold by Christie’s for $50 million. Most expensive pink diamond per carat.

  10. Furniture: 1766 Chippendale commode with ivory inlays sold previously in 1991 for £935,000, a record price for a piece of English furniture. Offered for auction by Christie’s with the inlays removed and an upper estimate of £5 million. Failed to sell.

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-Why the Tiffany Diamond Lady Gaga Wore to the Oscars Made the Jewelry World Gasp. The Academy Award winner is only the third person to ever wear the historic diamond. Was it the most expensive jewel ever worn to the Academy Awards? At a reported $30 million, it’s likely that Lady Gaga’s Tiffany diamond necklace earns that title. (The previous record had been held by Gloria Stuart’s $20 million Harry Winston blue diamond inspired by Titanic’s Heart of the Ocean.) But that is actually not why this particular diamond necklace sent jewelry experts into a frenzy on Sunday night.

I have been writing about jewelry for over 20 years and have been given insider access to some of the most priceless of pieces, but I have never seen the 128 carat fancy yellow Tiffany diamond outside its vitrine on the main floor of the Tiffany store on Fifth Avenue. It began as a 287 carat hunk of rough stone discovered in the Kimberly mines of South Africa in 1877. It was acquired by Charles Lewis Tiffany a year later and he entrusted his famed gemologist George Frederic Kunz, for whom the pink stone Kunzite is named. Kunz cut the stone into a 128 carat cushion to bring out its brilliance. It was immediately recognized as a treasure and became something close to an American Crown jewel. It was exhibited at the 1893 Chicago World’s Fair and made a rare appearance in the windows of Tiffany in 1955 in the hands of a gold wire angel.

Only a few years later it graced the neck of Audrey Hepburn (only the second woman to every wear it publicly) at the center of a Jean Schlumberger diamond ribbon necklace for some promotional shots for Breakfast at Tiffany’s. (In 1995 the stone was set in another Schlumberger piece, Bird on a Rock, for a museum show in Paris.) In 1972 Tiffany placed a possibly tongue in cheek ad in the New York Times offering it for $5 million (about $25 million today) to anyone who could come up with the money in a strict 24 hour period (any checks mailed after that date would be returned with thanks). In 2012 the diamond was set in its current diamond-necklace setting for Tiffany’s 175th anniversary. When Lady Gaga emerged on the red carpet wearing this with that McQueen dress and black leather gloves, history was made.

“The Tiffany Diamond is an exceptional stone for many reasons, including its incredible size, its historic importance and the fact that it has remained at Tiffany & Company since its purchase in the 19th century,” explains Daphne Lingon, head of the jewelry department at Christies. “In recent years, we have seen yellow diamonds command extremely high prices at auction as the color’s rarity is becoming more coveted. However, this stone is truly in a league of its own for its size and its long history with the renowned jewelry house. It was exciting to see the piece re-emerge for an evening of Hollywood glamor.” And if you did not happen to get an invite to the awards themselves, you can have a front row seat to the Tiffany Diamond when it returns to its home in a center vitrine at Tiffany’s Fifth Avenue store on March 2. Read more here-http://bit.ly/2NLO4QZ

-Haven’t we seen that before? Camilla wears 150-year-old diamond and emerald heirloom pendant famously worn by Diana in Austria in 1986. Read more here-https://dailym.ai/2H195GI

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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

-“Central banks bought the most gold since 1971 last year, a net purchase of 650 tonnes, while institutional holdings in exchange traded funds are at record levels.” Peter Cooper

-Rising star palladium shines brightly.Palladium is blazing a record-breaking trail on supply deficit fears, fuelled by strong demand from carmakers as more and more consumers switch from high-polluting diesel to cleaner vehicles, experts say. The precious metal, which is used in the manufacture of catalytic converters for petrol engines, scored a record pinnacle on Tuesday at $1,568 per ounce. The commodity, which is mostly mined in Russia and South Africa, was also buoyed by supply-side woes and solid demand from China despite a recent economic slowdown in the Asian powerhouse. Palladium has rebounded sharply since striking a one-year low of $836 per ounce in August, when it was rocked by a strong dollar.

“Demand for palladium in gasoline autocatalysts has seen strong growth over the last few years, driven by Chinese growth and a declining diesel market share following the Volkswagen scandal,” said Renaissance Capital commodities analyst Steven Friedman. Volkswagen’s pollution-cheating “dieselgate” scandal has also loomed large since 2015 because it hurt demand for diesel-powered vehicles in the longer term. Germany’s biggest carmaker lurched into crisis after admitting that it had fitted as many as 11 million of its diesel cars with software capable of fooling official pollution tests. In December meanwhile, palladium eclipsed gold in dollar terms for the first time in 16 years, and it has so far traded above gold for most of 2019.

It has benefited from weakening demand for high-polluting diesel cars that face tighter regulation worldwide. In stark contrast, sister metal platinum a key component in converters for diesel engines languishes not too far from a 10-year low that was struck last August. Diesel accounted for 36 percent of new car registrations worldwide in 2018, according to data from automotive research consultancy Jato Dynamics. That was sharply down from 44 percent in 2017, while the figure had stood at a record high 55 percent in 2011. As a result, automotive demand for palladium jumped to a record high of 8.66 million ounces in 2018, up three percent from 2017, according to the world’s largest palladium refiner Johnson Matthey. Both platinum and palladium remain supported, to varying degrees, by tight global supply. Read more here-http://bit.ly/2UpIRAH

-Allen Sykora: Silver To Strengthen, Outmuscle Gold By Late 2019. Silver should rise during the latter part of 2019 and outperform gold, with the gold/silver ratio falling to the low 70s, says the consultancy Metals Focus. The precious metal rose sharply in the early part of 2019, climbing to a high of $16.22 an ounce on Feb. 20, its highest level since June. Since then, however, gold has come under pressure, pulling down silver with it. Prior to the recent pullback, improved sentiment toward silver was reflected in Comex positioning, Metals Focus said in a report released late Tuesday.

Money managers had swung to a net-long, or bullish, position after being net short, or bearish, for much of 2018. Silver holdings by exchange-traded products were described as “stagnant” since early 2019 but nevertheless remain only 9% below the peak, the consultancy. “A positive picture is also revealed when it comes to retail investment in the U.S., the world’s biggest market for silver bars and coins; after three years of heavy losses, sales of U.S.

Eagle silver bullion coins for January-February 2019 jumped by 48% y/y [year-on-year], albeit from a low base,” Metals Focus said. Still, investors are not moving into silver heavily yet, particularly since they do not anticipate a secular downturn in the stock market, Metals Focus said. Further, worries about an economic slowdown in emerging-market economies such as China are also a hindrance to silver investment. Nevertheless, despite some short-term headwinds, analysts said they anticipate that late 2019 will be a turning point for silver investment and hence prices. Read more here-http://bit.ly/2H2ZSOn

-William L. Silber: Silver, not gold, is the portfolio insurance to buy now. Fear drives up precious metal prices. Fear of war, defaults, inflation, civil unrest and anything that undermines trust in government. A week after the Lehman Brothers bankruptcy in 2008, gold and silver jumped by 15%. Three years later, during the height of the European government debt crisis, when the obligations of Italy, Ireland, and Greece resembled junk bonds, silver more than quadrupled in value, while gold increased 250%. Today, fear of a financial collapse has receded, and so have the prices of both precious metals. Gold sits at about $1,300 and silver languishes a little above $15. Is it time to buy at these bargain prices? The answer is yes, especially silver, but not for the reasons you think. Read more here-https://on.mktw.net/2TBwPXV

-Clive Maund: Gold Market Update. The rather sharp drop in gold late last week, especially on Friday, came as something as a shock to many investors in the sector, yet as we will proceed to see it was set up to react back here or soon, and a period of consolidation or reaction at around this level will actually put it in a better technical condition to mount a sustainable breakout above the key $1400 level. On its latest 7-month chart the 1st point to observe is that gold is still well within our parabolic uptrend, whose lower boundary is coming into play and providing support, as is the rising 50-day moving average, with additional support being generated by premature sellers in the small Pennant pattern that formed during the first half of January. This is why it closed well off the lows on Friday, and why it could now resume the upward path again soon, and here’s the point even if it doesn’t and instead breaks down from the parabolic uptrend, which the sizeable drop on strong volume on Friday certainly makes possible, it will not be the “end of the world” for gold, and we will see why that is on our next chart. Read more here-http://bit.ly/2tS9CCj

-Clive Maund: Silver Market Update. Silver fell sharply on Friday after dropping on Wednesday and Thursday, and the reason it fell so sharply can be seen on its latest 6-month chart below which shows that it breached its parabolic uptrend, which had become too steep, this differed from gold whose similar parabolic uptrend held, for now. While the nearby support level shown held on Friday, bearish COTs suggest that it will drop further over the short to medium-term, probably to the stronger support in the $14.80 – $14.90 area, but possibly lower. Read more here-http://bit.ly/2ukL5rH

-Largest Gold ETF Shrinks Most in Year as Trade Tensions Ease. Investors are pulling cash from the world’s largest gold exchange-traded fund at the fastest pace in more than a year as easing trade tensions push buyers out of safe-haven assets. The $33 billion SPDR Gold Shares ETF, or GLD, saw a net withdrawal of $496 million on Friday, the most in a single day since February 2018. That pushed the five-day total to about $720 million, marking the fourth consecutive week of outflows. Investors are weighing the prospect of a trade deal that could lift most or all U.S. tariffs, boosting risk appetite and dimming the appeal of havens. Commerzbank AG analysts including Carsten Fritsch attributed flows out of GLD and a dip in bullion prices below $1,300 an ounce to “good sentiment” in a research note.

A strengthening dollar and a rebound in the equity market also eroded demand for bullion. “Gold is thought to be a safe haven, particularly during pullbacks, anticipated downtrends and market volatility,” said Sylvia Jablonski, head of capital markets at Direxion, which specializes in leveraged ETFs. “We are hearing positive news on the anticipated progress between President Xi and Trump, which may lead some investors to perhaps consider risk and reduce or not add additional gold exposure in the near term.” ETFs tracking gold miners have also lost cash lately. Investors pulled $148 million from the VanEck Vectors Gold Miners ETF and $142 million from the VanEck Vectors Junior Gold Miners ETF last week. Bloomberg

-Global Gold output to fall through 2020. The concept of peak gold is something that investors should get used to as one Canadian bank sees gold production falling through 2020 at least. Looking at the global gold supply, Colin Hamilton and Andrew Kaip, analysts at BMO Capital Markets, said that with most of the 2018 numbers out, it looks like gold production has dropped for the second consecutive year. The analysts added that this trend is not expected to shift for at least the next two years. “We anticipate that, with existing operations continuing to be a drag on supply volumes, and Chinese output in trend decline, a renewed focus on exploring for and developing large, longer-dated gold projects will be required,” the analysts said in their report.

Although mining companies are increasing their exploration budget, the analyst said that the problem remains the dearth of significant deposits. “When we look out over the next five years, there are very few large-scale new gold projects earmarked to come on-stream,” the analysts said. “The only large-scale gold projects that we see as probable to enter the top 10 producing gold mining operations by 2025 are Donlin Creek project, owned by Barrick and Novagold, and Sukoi Log owned by Polyus Gold.” The bank noted that even if major deposits are discovered, they still face development hurdles. Read more here-http://bit.ly/2HjSUne

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Investing In Fancy Colored Diamonds

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

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

1 Carat Radiant Cut Fancy Vivid Pink

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

1 Carat Radiant Cut Fancy Vivid Pink

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

1 Carat Radiant Cut Fancy Vivid Pink

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

1 Carat Radiant Cut Fancy Vivid Pink

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

1 Carat Radiant Cut Fancy Vivid Pink

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

1 Carat Radiant Cut Fancy Vivid Pink

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

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Vivid Pink

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

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Intense Yellow

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

1 Carat Radiant Cut Fancy Intense Yellow

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

1 Carat Radiant Cut Fancy Intense Yellow

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

1 Carat Radiant Cut Fancy Intense Yellow

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

1 Carat Radiant Cut Fancy Intense Yellow

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

1 Carat Radiant Cut Fancy Intense Yellow

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

1 Carat Radiant Cut Fancy Intense Yellow

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

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Intense Yellow

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

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Vivid Blue

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

1 Carat Radiant Cut Fancy Vivid Blue

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

1 Carat Radiant Cut Fancy Vivid Blue

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

1 Carat Radiant Cut Fancy Vivid Blue

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

1 Carat Radiant Cut Fancy Vivid Blue

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

1 Carat Radiant Cut Fancy Vivid Blue

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

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Vivid Blue

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

*Estimated value based on current market trend

1 Carat Radiant Cut Fancy Red

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

1 Carat Radiant Cut Fancy Red

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

1 Carat Radiant Cut Fancy Red

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

1 Carat Radiant Cut Fancy Red

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

1 Carat Radiant Cut Fancy Red

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

*Estimated value based on current market trend