The Crime Of ‘33

By Keith Weiner – Re-Blogged From Gold Eagle

Last week, we wrote about the impossibility of China nuking the Treasury Bond market… Really, this is not about China but mostly about the nature of the dollar and the structure of the monetary system. We showed that there are a whole host of problems with the idea of selling a trillion dollars of Treasuries:

  1. Yuan holders are selling yuan to buy dollars, PBOC can’t squander its dollar reserves
  2. If it doesn’t buy another currency, it merely tightens monetary conditions in China
  3. If it does, it will drive up the price of whatever it buys, but crash it when it sells later
  4. It is still supporting the dollar, as the euro is (like the yuan) a dollar-derivative
  5. It would lose money by holding the positon, due to the interest rate in the euro
  6. It incurs severe exchange-rate risk (the euro is in a downtrend against the dollar)
  7. And the debt of Spain, Italy, and others is headed for a train-wreck

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Weekly Climate and Energy News Roundup #360

The Week That Was: May 18, 2019, Brought to You by www.SEPP.org

By Ken Haapala, President, Science and Environmental Policy Project

Quote of the Week: “For a successful technology, reality must take precedence over public relations, for Nature cannot be fooled.” – Richard Feynman to NASA after the Challenger explosion.

Number of the Week: 415.26 ppm

Language: In WUWT, a TWTW reader asked: “Do you see a tendency in the climate change reporting, say in the last 3 years? Is it getting better, scientifically speaking, or worse?”

Both in newspapers and in magazines with science or nature in the name, the reporting has been become more strident and personal attacks more frequent. But this was occurring long before the election of Donald Trump.

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3 More Years Of Expansion?

By Arkadiusz Sieroń – Re-Blogged From Gold Eagle

We are just a moment away from a significant achievement. If the current US economic expansion lasts until July 2019, it will reach 121 months, becoming the longest ever. The extended duration of the prosperity begs the question of when the next downturn will occur. Many analysts believe that its days are numbered, but we dare to disagree.

You see, we do not focus on the mere headlines, but always investigate the underlying factors behind the changes in specific data series. That’s true that the current expansion will likely be the longest on the record, but the reason for this is the softness of the recovery. The present expansion has been weaker than historical recoveries. Indeed, the real GDP has jumped just 24 percent since the end of the Great Recession. That’s a very disappointing result by historical standards: on average, the GDP rose by 33 percent during the previous three economic expansions, even though they were shorter.

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Gold Mid-Tiers’ Q1’19 Fundamentals

By Adam Hamilton – Re-Blogged From Gold Eagle

The mid-tier gold miners’ stocks in the sweet spot for price-appreciation potential have been struggling in recent months, grinding lower with gold.  Their strong early-year momentum has been sapped by recent stock-market euphoria.  But gold-mining stocks are more important than ever for prudently diversifying portfolios.  The mid-tiers’ recently-reported Q1’19 results reveal their fundamentals remain sound and bullish.

The wild market action in Q4’18 emphasized why investors shouldn’t overlook gold stocks.  All portfolios need a 10% allocation in gold and its miners’ stocks!  As the flagship S&P 500 broad-market stock index plunged 9.2% in December alone, nearly entering a new bear market, the leading mid-tier gold-stock ETF surged 13.7% higher that month.  That was a warning shot across the bow that these markets are changing.

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You Know Things are Falling When…

…when the stock market’s decade-long bottom trend becomes its new top trend and then it can’t even make it back up to that line as a top trend.

We’re sloughing away now, and it can be a long slide to the bottom or endless side-winding of big ups and downs that go nowhere, just as the market has now gone nowhere for fifteen months.

Yes, if you bought in January, 2018, (when I said the market would fall) and held, you have made nothing (unless you did well on dividends)! If you continue to hold, the odds are you will do worse than nothing; but, hey, you did get to enjoy a heck of a roller-coaster ride. If, on the other hand, you sold in January of 2018 and put your money in cash, you made 2% a year with worry-free smooth sailing every day of the year. Here’s the proof on stocks:

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Negative Interest Rates Spread To Mortgage Bonds

By John Rubino – Re-Blogged From Dollar Collapse

There are trillions of dollars of bonds in the world with negative yields – a fact with which future historians will find baffling.

Until now those negative yields have been limited to the safest types of bonds issued by governments and major corporations. But this week a new category of negative-yielding paper joined the party: mortgage-backed bonds.

Bankers Stunned as Negative Rates Sweep Across Danish Mortgages

(Investing.com) – At the biggest mortgage bank in the world’s largest covered-bond market, a banker took a few steps away from his desk this week to make sure his eyes weren’t deceiving him.

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Utility Halts Natural Gas Hook-Ups For NYC, Long Island After Cuomo Administration Blocks Pipeline

Michael Bastasch – ReBlogged From The Daily Caller

The northeastern U.S.’s largest supplier of natural gas stopped processing new customer applications in New York City and Long Island after the Cuomo administration blocked a major pipeline project.

The moratorium is the second to hit New Yorkers in 2019 as a result of Democratic Gov. Andrew Cuomo’s opposition to natural gas pipelines needed to meet growing demand in the state and New England.

“We are not processing new applications for any new customers,” National Grid New York President John Bruckner said Thursday. “We’ll continue to receive requests for service, but we’re not processing them.”

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