Will The US Economy Fall Into Recession? Or Will It Accelerate?

By Arkadiusz Sieroń – Re-Blogged From Gold Eagle

The current economic expansion has just equaled with the longest boom in the US history. Is that not suspicious? We invite you to read our today’s article, which provide you with the valuable lessons from the 1990s expansion for the gold market and find out whether the US economy will die of old age.

Lessons from the 1990s Expansion for the Economy and the Gold Market

The current economic expansion has just equaled with the longest boom in the US history. Unless the sky falls in the next few weeks, we will celebrate a new record in July. Is that not suspicious?

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Frothy Bubbles Make Me Whine

By David Haggith – Re-Blogged From Great Recession Blog 

These are not the tiny champagne bubbles Don Ho used to sing about, but those greenish-gray floats of foam that pile up against harbor docks where the churn of the waves meets the oil spittle of boat motors. They are the economic froth that has piled up around us and is now beginning to fizzle.

They are the bubbles of overbuilt retail space, heaps of junk bonds and layers of leveraged loans, rafts of student loans, bloated government spending. They’re the slop that formed from massive monetary expansion frothed up out of less than nothing — out of debt.

You’ve heard about all of them many times, but my concern in this article is that we are starting to hear tiny popping sounds, which leads me to the following scenario as a plausible path into recession this summer: (Not the only possible route, but one littered with likelihoods.)

Red Pill Realities

We can face reality by swallowing the “red pill” (from the movie “The Matrix). This choice is uncomfortable because it opposes the propaganda from mainstream media, government statisticians, and Wall Street cheerleaders.

The “red pill” road is difficult and sometimes lonely. Gold is a “red pill” choice.

The “blue pill” path is easier and reassuring. Other “blue pill” advocates will applaud your choices. The herd approves this delusional path. Think debt-based fiat currencies.

The “blue pill” is best swallowed with a healthy slug of whisky, anti-depressant drugs, a few hits from now-legal “weed,” and platitudes from the evening news.

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Fed Running Out Of Time And Conventional Weapons

By Michael Pento -Re-Blogged From PentoPort

The buy and hold mantra from Wall Street Carnival Barkers should have died decades ago. After all, just buying stocks has gotten you absolutely crushed in China for more than a decade. And in Japan, you have been buried under an avalanche of losses for the last three decades. And even in the good old USA, you wouldn’t want to just own stocks if the economy was about to enter another deflationary recession/depression like 2008. Likewise, you wouldn’t want to own any bonds at all in a high-inflation environment as we had during the ’70s.

The truth is that the mainstream financial media is, for the most part, clueless and our Fed is blatantly feckless.

The Fed has gone from claiming in late 2018 that it would hike rates another four times, to now saying that it is open to actually start cutting rates very soon.

My friend John Rubino who runs the show at DollarCollapse.com recently noted: “bad debts are everywhere, from emerging market dollar-denominated bonds to Italian sovereign debt, Chinese shadow banks, US subprime auto loans, and US student loans. All are teetering on the edge.” I would add that the banking system of Europe is insolvent—look no further than Deutsche Bank with its massive derivatives book, which is the 15th largest bank in the world and 4th biggest in Europe. Its stock was trading at $150 pre-crisis, but it has now crashed to a record low $6.90 today. If this bank fails, look for it to take down multiple banks around the globe.

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Global Manufacturers Just Shrank For The First Time in 7 Years

Perhaps surprising no one, global manufacturers are now in contraction mode for the first time since 2012. That’s according to the most recent reading of the sector’s health, the purchasing manager’s index (PMI), which headed lower for a record 13th straight month in May. The PMI posted 49.8, down from 50.4 a month earlier. As a reminder, anything above 50.0 indicates expansion; anything below, contraction.

Less than half of world economies’ manufacturing sectors are expanding right now, “the worst showing since the throes of the euro area sovereign debt crisis in 2012,” according to analysis by Neil Dutta, head of economics at Renaissance Macro Research (RenMac).

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The Economy Continues To Deteriorate

By Dave Kranzler – Re-Blogged From Gold Eagle

Trump’s trade advisor, Peter Navarro, was on CNBC today asserting that the economy was expanding at an unprecedented rate.  Either Navarro is tragically ignorant or an egregious liar. Either way he looks like an idiot to those us who study the real numbers and understand the truth.

The Global Manufacturing PMI (Purchasing Managers Index) dropped to 50.4 – the lowest since July 2016. It’s been falling almost nonstop since mid-2017. The current period of decline is the longest in the 20-year history of the index. The index includes the purchase of inputs for the manufacturing of consumer goods, investment goods (capex material) and intermediate goods (semi-finished goods used as inputs for final goods).

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US Is Winning Trade War With China…For Now

The ongoing battle between the United States and China for economic supremacy isn’t only being fought in the gilded ballrooms of Washington, as trade negotiators from either side parry over automobile parts content, intellectual property rights, government subsidies and the like.

Casualties and victories are also borne out over the decks of hulking freighters that carry the commodities which make up the nuts and bolts of international trade.

Indeed, shipping statistics are often sought by economics and traders trying to predict the health of a country’s economy or the world economy. The Baltic Dry Index (BDI) is one such leading indicator. Another is the Purchasing Managers’ Index (PMI). PMIs are a monthly survey of supply chain managers across 19 industries. An economy with a PMI of over 50 is considered to be growing; under 50 means an economy is treading water or possibly drowning.

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