In the wake of gold prices cratering in recent days, more than a few prominent experts have already started pinning the blame on Western central banks — especially the Federal Reserve and the European Central Bank (ECB). According to numerous analysts, the central bankers are desperate to salvage their fiat currencies and eliminate competition as monetary authorities continue to create ever-greater quantities of euros and dollars out of thin air.
Some experts, whistleblowers, traders, and former officials say the Fed dumped as much as 400 or even 500 tons of “paper gold” on the market — metals that it might not even have — as part of a naked short sale aimed at driving down the prices. Other analysts, especially among the establishment, pointed to the ECB chief’s recent suggestion that struggling European authorities in countries like Cyprus would have to sell their precious metals to keep receiving bailouts.
The battle between a stock market that moves inexorably higher and an economy that continues to languish will be won when reality is recognized: The economy is getting weaker and consequently stocks are overpriced.
After looting some 30 percent of selected bank account holders’ deposits in Cyprus on behalf of the so-called “Troika”— the European Union (EU), the International Monetary Fund (IMF), and the European Central Bank (ECB) — eurozone boss Jeroen Dijsselbloem told reporters this week that taking money from savers in other crisis-hit nations to prop up banks could become the norm. Across Europe, analysts, experts, economists, markets, and especially savers recoiled in horror, prompting the increasingly discredited Dutch Finance Minister to backtrack slightly. In Cyprus, meanwhile, anger is boiling over as authorities prepare to impose capital controls in an effort to avoid a full-blown bank run.
A researcher at the International Monetary Fund expressed surprise at the greatly increased production of natural gas due to fracking and the law of supply and demand in a market economy. Those increases are reducing transportation costs and bringing lower prices to American consumers.
Panic-stricken bank depositors in Cyprus emptied ATM machines across the nation after the surprise announcement Saturday that, as part of an extremely controversial European Union and International Monetary Fund bailout deal, authorities would seize up to 10 percent of all savings deposited in Cypriot banks. Markets across Europe plunged as fears of contagion or even a large-scale bank run in the region plagued investors, with the single euro currency falling to multi-month lows and gold rising back above $1,600 following news of the $13 billion scheme.
Global demand for gold hit a new record value level in 2012 and central banks around the world were gobbling up the precious metal at rates not seen in nearly 50 years, according to findings released by the World Gold Council this month. The industry council said that in value terms, gold demand in 2012 was over $235 billion — an all-time high — and fourth-quarter figures of more than $66 billion marked the highest Q4 total ever.
The consequences of governmental intrusion into the private market are inevitable, painful, and costly, as students such as Nick Keith found out much too late.
Foreign governments continue to increase their purchases of U.S. government debt despite concerns over the fiscal cliff and the government's continued profligate spending.
Calling it “unexpected,” Reuters reported that the Purchasing Managers Index (PMI) from the Institute for Supply Management for November fell to its lowest level in over three years. A poll of economists by Reuters showed they didn't see it coming.
The United Food and Commercial Workers (UFCW) union has threatened 1,000 protests against Walmart on Black Friday, while the giant retailer has filed a complaint against such actions by the union with the National Labor Relations Board (NLRB).
Hard-money investment manager Marc Faber predicts that markets could decline by 20 percent, perhaps more, as the economy faces the continued recession and worries about the "fiscal cliff."