Gold finishes at more than 2-year high
Gold futures closed sharply higher Tuesday, with the yellow metal finishing at its highest level in more than two years as skittish investors sought out haven assets.
Concerns about ineffective measures by central banks to prop up flailing economies in Japan and Europe, and renewed expectations that a rate increase by the Federal Reserve is unlikely soon, have piqued interest in precious metals.
Low and negative-yielding government bonds raise the appeal of gold, which doesn’t bear interest.
One in five company bonds bought by ECB yielded less than zero
One in five company bonds bought by the European Central Bank since June yielded less than zero, the ECB said on Wednesday, raising questions about whether the bank risks fueling a market bubble and will need to slow the pace of its purchases.
The ECB has bought 13.2 billion euros ($14.8 billion) worth of corporate debt since it added credit to its shopping list in June, with the aim of lowering borrowing costs for companies to stimulate hiring and investment.
Yields on the bonds it bought ranged from a negative 0.3 percent to more than 3 percent, with just over 20 percent of the total yielding less than zero, the ECB said in its economic bulletin on Wednesday, publishing details of its purchases for the first time.
The grim reality is that real inflation is 7+% per year, and this reality must be hidden behind bogus official calculations of inflation as this reality would collapse the entire status quo.
Super-wealthy elites earning 10+% yields on stock, bond and real estate portfolios aren't particularly impacted by 7% inflation; their real wealth continues to expand nicely.
Who's being destroyed by 7+% real inflation? Everyone whose income has stagnated and everyone who depends on wages rather than assets to get by--in other words, the bottom 95%.
Donald Trump Warns Americans To Get Out Of The Stock Market As The Dow Falls For A 7th Day In A Row
One thing that you have to appreciate about Donald Trump is that unlike most politicians, he actually says what is on his mind. On Tuesday, Trump told Fox Business that he had already gotten out of the stock market, and that he foresees “very scary scenarios” ahead for investors.
And of course things have already started to get a bit ominous for those holding stocks over the last week and a half. The Dow Jones Industrial Average has now closed down for seven days in a row, and that is the longest losing streak that we have seen since the panic of last August. Over the past 12 months we have seen virtually every other major global stock market experience at least one major crash. Could the U.S. markets be next?
What Trump told Fox Business earlier today was actually right on the money. Our financial markets have been artificially inflated by the Federal Reserve, and all artificial bubbles of this nature eventually burst.
DYI Comments: The world is definitely in bubble land and all bubbles will eventually bursts. Here at DYI I feel as if I'm the boy boy who cried wolf -or should I say BEAR - only for the townsmen never to find that pesky animal! Just because it hasn't happened doesn't mean it won't! At these levels for stocks and bonds poor returns are "baked into the cake" so much so, DYI is anticipating a "run of the mill" decline of 45% to 60%. Cutting the stock market by 54% only returns the market to it mean.
Estimated 10yr return on Stocks
This is why a decline of this magnitude is only "run of the mill!" Many years from now the market from peak to trough, inflation corrected, will decline 75% to 85% ending the secular bear market that began December of 1999!
DYI
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