Commodity Trade Mantra

Posts Tagged ‘Debt’

Why the Coming Wave of Defaults Will Be Devastating

In an economy based on borrowing, loan defaults & deleveraging matter. Defaults mean loans & bonds won’t be paid back. The owners of the bonds & debt (mortgages, auto loans, etc.) will have to absorb massive losses. Having unleashed tens of trillions of dollars in new credit since 2008, the central banks have simply increased the likelihood & scale of the coming default conflagration.

Due to Financial Cancer of Debt, Devastation is Our Future- Gold the Only Remedy

The fact that demand for gold is soaring says a great deal about investors’ combined frame of mind these days. People are scared. I fear devastation is in our future. If central bankers had succeeded in their efforts, we would have no need for negative rates. There is simply too much debt (financial cancer) in the system to save it. And buyers of gold know this.

Insanity Is The World “Norm: Keep Stacking Gold and Silver

There are far better reasons to be buying & personally holding gold and silver, and price is the last consideration. More importantly, for now, is availability. Get either, or both, while you still can. This window of opportunity will close without warning. How, when, or even under what circumstances no one knows. If you do not own gold and /or silver, you got nothing!

Unsustainable Debt will Melt most Paper Assets - Buy Physical Gold and Silver

Inflation since the early 1980’s was forced into the broader markets rather than into energy and commodities. Which means, most Americans have this false sense of WEALTH, when in all reality, they are completely broke. When the markets really CRACK in a big way, investors will flock into gold and silver, just like they are doing today on a lousy jobs report.

Cash Flow Negative US Energy Companies Have $325 Billion In Debt Among Them

With the topic of distress among U.S. oil and gas exploration and production companies becoming more important with every passing day that oil not only continues to drop, but certainly fails to rebound to levels that allow US energy companies to return to a cash flow positive state, we would like to show just how much debt is at stake.

Why the Bear of 2015 Is Different from the Bear of 2008

It’s tempting to see similarities in last week’s global stock market mini-crash and the monumental meltdown that almost took down the Global Financial System in 2008-2009. The dizzying drop invites comparison to the last Bear Market that took the S&P 500 from 1,565 in October 2007 to 667 on March 9, 2009. Here are a few of the differences.

It’s Time to Hold More Cash and Buy Gold

Bank of America highlights problems with raising rates. The real economy in the U.S. is not currently strong enough to withstand a rise in interest rates. That raising rates could cause a shock to the markets & economy. To deal with this they advocate adding gold to one’s portfolio along with higher levels of cash.

How GDP Metrics Distort Our View of the Economy

GDP purports to measure economic activity while largely divorcing itself from quality, profitability, depth, breadth, improvement, advancement & rationalization of goods & services provided. Why does GDP poorly reflect economic size & vitality? Its largely due to 3 fallacious concepts embedded within GDP measurements.

Report: 2016 is start of new Gold Bull Cycle

Gold Focus 2015 – forecasts a bottom in the price of gold this year with a rising trend in 2016 after three years of declines. Also expects further price weakness in the coming months and a low for the year at $1,080 which would constitute a more than 5-year low. Shortly after the first Fed action in six years gold will start appreciating.

Beware: Fracking Is Where Money Goes to Die

The fracking boom has been cash-flow negative for oil and gas drillers from the very beginning. The steep decline rates of fracked wells force producers to drill more wells just to keep production and revenues flat. They fund this drilling with debt. To support that growing debt, they have to produce more & take on even more debt.

Debt, Deflation, The Dollar & - Gold: The Ultimate Currency

The soaring dollar is now causing turmoil in the currency market. Gold, as the ultimate currency, is only second to the US dollar in terms of major currency strength. At some point coming up pretty quick, the dollar rise will be stemmed, either by intervention or exhaustion. And when that happens, a dollar decline will give gold a boost.

Fed Admits There Is Persistent Over-Optimism About The US Economy

Real GDP growth forecasts have typically started high, but are revised down over time as incoming data continue to disappoint. Possible explanations for this pattern include missed warning signals about buildup of imbalances in the economy before the crisis. Persistent bias applies to growth forecasts & also of inflation & unemployment.

How Do You Unmanipulate a Manipulated Economy?

Regardless of what slippery words are deployed to mask manipulation, it doesn’t change the reality that the US economy remains a manipulated mess that is dependent on monetary & statistical manipulation. Left unmanipulated, the statistics would no longer be rosy & both the economy & our perception of the economy would tank.

Repeat After Me: The US Dollar Is Not Real Money

The dollar is not real money. It represents no real work, savings or wealth. Civil servants can create it at will. As much as they see fit. And what about the saver? He must think himself a fool. For all his self-discipline…his forbearance…his willingness to forgo immediate satisfaction in return for greater returns later…what does he get? NOTHING.

On The Verge Of Next Economic Crisis, 62% Americans Living Paycheck To Paycheck

Nearly two-thirds of all Americans are completely & totally unprepared for the next economic crisis. That essentially means that 62% of the people in the U.S. do not have an emergency fund. Even after the extremely bitter financial lessons that millions of Americans learned during the last recession, most still choose to live on the edge.

Not ‘Rushing in’ to Buy Oil Juniors for 5 or 6 Months : Rick Rule

A lower oil price might stimulate demand in the near term, as people have more money, thanks to lower gasoline & energy costs. This begins to seed the overall economy for a recovery – a real recovery unlike the manufactured ones, based on cheap credit in developed nations. In the near term, though, price decline may weigh on the economy.

The First Shale Casualty: WBH Energy Files For Bankruptcy; Many More Coming

American oil and gas companies have gone heavily into debt during the energy boom, increasing their borrowings by 55% since 2010, to almost $200 billion. Their need to service that debt helps explain why U.S. producers plan to continue pumping oil even as crude trades for less than $50 a barrel, down 55% since last June.

Why You Need to Own Gold In 2015 and Beyond

Gold’s universal appeal across continents makes the metal extraordinary. But it is gold’s appeal across time that makes it unique. What will happen to the gold price when masses of cynical people tire of holding dishonest money and look for an incorruptible alternative? Smart investors aren’t waiting to find out.

Central Banks Create Deflation, Not Inflation

The Federal Reserve and other central banks desperately want inflation, even though it destroys the purchasing power of paychecks and savings, for one reason:in a system based on phantom collateral supporting ever-increasing mountains of debt, the Prime Directive of central banks is to make it ever easier to service yesterday’s debt.

Cheap Oil A Boon For The Economy? Think Again

Tumbling oil prices are a bonanza for global stock markets, provided the chief cause is a surge in crude supply rather than a collapse in economic demand. Roughly one third of the current oil slump is a shortfall in expected demand, caused by China’s industrial slowdown and Europe’s austerity trap.

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