Ancient Dollars and Gold Bullion

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Posted by Gary Christensen - The Deviant Investor

on Wednesday, 01 August 2018 08:25

Consumer price inflation is real. It sneaks into every facet of life. Bags of coffee shrink from 16 ounces to 12 ounces and then to 10 ounces. “Shrinkflation is policy. That Snickers candy bar is smaller but costs the same or more.

But don’t blame the candy industry, coffee distributors or automobile manufacturers. Fiat currencies create the problems.


Why do we need to fix our currency? Because commercial banks (via fractional reserve banking) and the Federal Reserve print dollars by the trillions, devalue all existing dollars, and increase prices on almost everything. Do you remember McDonald’s prices in 1961?


The problem is the currency unit. It shrinks in value!




Support Is Growing For Bitcoin ETF

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Posted by Aubrey Hansen

on Tuesday, 31 July 2018 11:34


As things stand, the bitcoin ETF is widely considered to be the biggest news story in the cryptocurrency industry this year. We have recently seen a decision on the Direxion Investments ETF’s announced for some time in September, while Bitwise Asset Management has become the latest venture to go down the route of lodging a cryptocurrency ETF application with the US Securities and Exchange Commission (SEC).

The application that has caught the attention of the cryptocurrency industry though is that which was unveiled in June from VanEck and SolidX. Both ventures have had previous applications shut down by the SEC, and decided this time to join forces and submit what is increasingly looking like a successful bitcoin ETF.... CLICK for the complete article



Trump-Juncker meeting in focus, Lira crumbles

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Posted by Futures Magazine

on Wednesday, 25 July 2018 06:53

2427Asian stocks have commenced on a positive note this morning, as strong U.S. corporate earnings and optimism over China boosting fiscal support for its economy rekindled risk appetite. European markets could benefit from the risk-on sentiment; however, gains may be limited as investors adopt a guarded approach ahead of a meeting between the European Commission President Jean-Claude Juncker and U.S. Donald President Donald Trump.

With escalating trade tensions between the European Union and the United States still, a key theme that continues to weigh on global sentiment, the outcome of today’s meeting could leave a lasting impact on the markets. If the talks prove unsuccessful and trade tensions end up escalating further, risk sentiment is likely to be negatively impacted.  Market players should be prepared to expect the unexpected from the talks, especially when considering how highly unpredictable the Trump administration can be.

Turkish Lira crumbles after central bank holds rates

The Turkish Lira depreciated heavily against the Dollar yesterday after the nation’s central bank defied market expectations by leaving interest rates unchanged at 17.75%, despite inflation soaring.

This move immediately raised questions over the central bank’s independence, a month after President Recep Tayyip Erdogan’s re-election under an amended constitution that enabled him to follow through on his promise to take more direct control over monetary policy. Outside of Turkey, global trade tensions, a broadly stronger Dollar and expectations of higher US interest rates have exposed to the Lira to downside risks. With a combination of external and domestic factors eroding buying sentiment towards the Lira, the local currency remains at risk of depreciating towards 5.00 and beyond against the Dollar.

Currency spotlight: EUR/USD

The euro/U.S. dollar (EUR/USD) currency pair was on standby on Wednesday morning, as investors positioned ahead of the anticipated meeting between US President Trump and European Commission President Jean-Claude Juncker.

Heightened concerns over a trade war with the United States have shaved some attraction away from the euro and this can be reflected in the bearish price action. There could be some action on the EUR/USD today depending on the outcome of the meeting. Focusing on the technical picture, the EUR/USD remains in a wide range on the daily charts. Sustained weakness below 1.1700 could inspire a decline towards 1.1640 and 1.1600, respectively. In regards to the longer-term outlook, the divergence in monetary policy between the European Central Bank and the Federal Reserve could ensure the currency pair remains depressed for prolonged periods.

Commodity spotlight: Gold

It has been a quiet start for gold this morning as bulls and bears were both missing in action. Regardless, the yellow metal remains bearish on the daily charts and has scope to extend losses as the Dollar stabilizes. Although global trade tensions could accelerate the flight to safety and support appetite for safe-haven gold, any meaningful gains are likely to be threatened by U.S. rate hike expectations. Gold bears need to attack and conquer $1,213 for prices to sink towards the psychological $1,200 level.



Things are Becoming Very Complicated & Possibly Very Dangerous

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Posted by Victor Adair - Live From The Trading Desking Desk

on Monday, 23 July 2018 07:27

market-tradersTrump “is not happy” with the Fed raising interest rates...claiming that rising rates hurt the American economy and cause the US Dollar to rise...that a rising US Dollar makes America less competitive. My good friend Dr. Martin Murenbeeld, (www.Murenbeeld.com ) has long argued that the best way to correct the huge American trade deficit is to drive down the USD...especially against overvalued Asian currencies.

Trade wars: In my July 7/18 notes I quoted Christopher Wood of CLSA as saying that “politics” have replaced Central Banks as the most important driver of world markets. I agree and I see Trump as the epicenter of “politics.”  Trade wars (Trump Vs. the Rest of The World) are a sub-set of “politics” and Trump is now threatening to escalate again with 25% tariffs on auto imports and up to $500B of tariffs on Chinese imports. In my June 9/18 notes I wrote that trade tensions were growing as Trump steps up his game...and that he was just getting started.

“Currency wars” are another sub-set of politics and Trump has linked “currency wars” to “trade wars” by declaring that the EU and China are deliberately devaluing their currencies to gain a competitive advantage over America. There may be some truth to that...at least in China’s case...and Trump has a point when he says that high US interest rates push up the US Dollar. But the New Fed is doing the right thing by boosting rates from “emergency” levels...the economy is strengthening and is able to deal with rising rates. But capital flows to America for safety and opportunity...not just to pick up yield.

The US Dollar Index (USDX) hit a one year high this week following Powell’s Congressional testimony. Powell said that the US economy is doing fine and that  the Fed will likely continue to gradually raise short term interest rates. The Dollar fell from those highs on Thursday’s CNBC Trump interview and fell further Friday morning on Trump’s tweets.





Trump in Fresh Attack on the U.S. Dollar - Accuses European Union, China of Currency Manipulation

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Posted by Pound Sterling Live - ZeroHedge

on Friday, 20 July 2018 06:30

- Dollar's strength under fresh attack ahead of the weekend

- European Union, China accused of currency manipulation

- But there is little Trump can do to stop the Dollar's ascent say analysts

- Seperately, Trump threatens to tariff all China's imports

Ed Note: for the impact on markets that Trump's attack has had check out ZeroHedge's "Dollar Tumbles As Trump Blasts China, EU "Currency Manipulation", Fed "Tightening"

donald-trump-dollar-exchange-rate-1US President Donald Trump has fired another salvo in what appears to be the start of a potential currency war by accusing the European Union, China, and others, of artificially massaging their interest rates and currency lower.

"China, the European Union and others have been manipulating their currencies and interest rates lower, while the U.S. is raising rates while the Dollar gets stronger and stronger with each passing day - taking away our big competitive edge. As usual, not a level playing field," Trump tweet at 13:43 B.S.T.

The tweet sent the US Dollar lower allowing the Pound-to-Dollar exchange rate the chance to stage a climb back to 1.3062, having been below 1.30 just 24 hours earlier. The EUR/USD exchange rate menawhile rose 0.45% on the day to reach 1.1707.

The tweet builds on an earlier attack by Trump on the Dollar's strength when he said in an interview he is “not thrilled” by the Federal Reserve’s ongoing interest rate hikes which are providing the key underpinning to a stronger US Dollar.

The Fed came in for another mention via a 1:51 P.M. tweet that came hot on the heels of that accusing the EU and China of manipulating their currency:

"The United States should not be penalized because we are doing so well. Tightening now hurts all that we have done. The U.S. should be allowed to recapture what was lost due to illegal currency manipulation and BAD Trade Deals. Debt coming due & we are raising rates - Really?"

The message from Trump is that the stronger Dollar is unattractive to him as he tries to improve the USA's global trade performance, and the Fed is partly responsible.



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