The Coming Recession Will Be Bearish For Bonds

Wait until investors figure out that the coming recession will be bearish for bonds. This time soaring budget deficits and a return to QE and ZIRP will result in a sharp fall in the dollar and rise in consumer prices. With stagflation real demand for bonds falls as supply rises!

Related trading instruments: 10- year U.S. Treasuries, iShares Barclays 20+ Year Treasury Bond ETF (TLT), ProShares UltraShort Lehman 20+ Year ETF (TBT)

Investors Are Fearless!

On CNBC this morning a prominent asset manager boasted he is buying U.S. stocks because investors are so fearful of an inverting yield curve and that the 2nd longest economic expansion is nearing its end. While investors should fear that and more, they don't. Investors are fearless!

Federal Reserve, Crude Oil Prices & Credit Card Debt

Fed's Dovish Posture: A Big Mistake

Every clueless commentator on CNBC is applauding the Fed's dovish posture. They don't understand that this shift was the inevitable result of prior monetary policy mistakes. Rather than acknowledging and leaning from those mistakes, the Federal Reserve is just making even larger ones now! 

FOMC Meeting: Gold and U.S. Dollar Reaction

The fact that the U.S. dollar is not already tanking and gold soaring underscores just how clueless investors remain as to the future trajectory of the U.S. economy and past efficacy of #Fed monetary policy. They are in for a rude awakening. 

Government Bonds: Few Real Buyers For Longer-Dated Maturities

The real reason the Federal Reserve is lengthening its balance sheet is that it knows there are few real buyers for longer-dated maturities. This will only worsen the Federal Reserve losses when it eventually sells those securities to fight inflation, or the public's losses if it choses not to!

Inflation & Crude Oil Prices

The decline in oil prices is the main reason Powell claims he is not worried about rising inflation. Yet oil prices are already up by 33% this year, rising above $60 per barrel today. Oil prices may actually double in 2019. As the U.S. economy slows, the CPI will rise faster.

Americans Owe Over  $1 Trillion In Credit Card Debt

Americans owe over $1 trillion in credit card debt and recent polling data indicates they aren’t paying off those balances anytime soon. (related stocks: Visa (V), Mastercard (MA), American Express (AXP))

A Bear Market Rally

I actually think the US stock market entered a stealth bear market at the beginning of 2018. But we didn't officially enter a bear market with the major averages dropping 20% or more in the fourth quarter of 2018.

 Then the Federal Reserve did exactly what I said they would do the minute the market either entered a bear territory or got close enough to do it to scare the Federal Reserve. I said from before the Fed even raised interest rates for the first time that if they ever attempted to normalize interest rates their attempt would fail that they could never complete the journey because along the way the market would break and the Federal Reserve would have to cut off the interest rate hikes and that's exactly what they did.

I also said that the initial calling off of future interest rate hikes would only create a relief rally in the market and that's what we've had. This rally is the correction. In bear markets the rises are the corrections, the opposite of a bull market. So, I think the Federal Reserve by throwing the markets this lifeline has created this bear market correction, this rally.

Trump Will Reach A Trade Deal With China

Trump will read a trade deal with China. In Peter Schiff`s opinion he has to. On a recent interview with RT.com, Peter explained why President Trump cannot afford not to have a deal. Read and watch the complete interview here: ‘Trump will reach trade deal with China, he can’t afford not to,’ Peter Schiff tells RT’s Boom Bust

Global Economic Weakness

Weakness in the global economy is not going to spill over into the U.S. economy. The U.S. economy will weaken on its own due to a host of domestic problems far greater than what overseas economies are dealing with. As the U.S. enters recession, the global economy will improve.

Trade Deal: Will The Markets Sell The News?

Since expectations of a great U.S. - China trade deal are so high, the market is poised to sell the news, particularly if the over-hyped deal does not live up to expectations. The best way for Trump to avoid disappointing markets is to delay an actual deal for as long as possible.

Precious Metals: Silver Will Rise Even More

Look at last time. Silver went up to $50 per ounce from $3 to $4 an ounce in 2000-2001. Gold went to $1,900 per ounce, but silver went to $50 per ounce. It was a much bigger percentage gain. If I am right about gold going to $5,000 to $10,000 (per ounce), I am sure the percentage gain in silver will be even bigger.

Gold Is The Last Thing You Should Be Shorting

I think this is the calm before the storm. People don’t really perceive it. Gold shorts are going to lose an incredible amount of money. That’s probably one of the most foolish things you can do. There are a lot of great things out there to short. Gold is the last thing you should be shorting. 

For central banks, gold is the safest reserve asset. It’s the only asset that is not somebody else’s liability. I think the world is going back to gold.

$5,000, $10,000 (per ounce) who knows how high it’s going to go. There is no real ceiling on the price of gold because there is no floor to the value of the dollar and other fiat currency. Gold is going to skyrocket.

The U.S. Dollar Is Going To Collapse

I think when they start to try to reflate the assets in stocks, real estate and in bonds, they are just going to prick the dollar bubble, and that’s when we have a real crisis. The dollar is going to collapse, and America’s days of living beyond its means is going to come to an end.

Jerome Powell Dismissed Surging Auto Loan Delinquencies

On 60 Minutes Jerome Powell dismissed surging auto loan delinquencies by saying they merely reflect that not everyone is benefitting from the widespread prosperity the U.S. is currently enjoying. But soaring delinquencies are more evidence that the prosperity is not widespread!

The Only Potential Risks Powell Sees Right Now

Jerome Powell told 60 Minutes that the only potential risks he sees facing the U.S. economy are slowing economies in Europe and Asia. Record Federal, state, corporate, and personal debts do not concern him at all. He is also not worried about the housing or auto markets. Crazy!

First Down Week For U.S. Stocks In 2019

In fact, this is the first down week that the U.S. stock market has had in 2019. Something tells me it's certainly not going to be the last.

China - U.S. Trade Deal: "I don't think we're gonna have a substantive deal"

I don't think we're gonna have a substantive deal that gets to the root cause of that I think that there's gonna be a deal I've been saying that since the beginning I think that Trump can't afford not to have a deal so there's gonna be one but it's not going to turn around America's massive trade deficit with China.

Stock Market & U.S. - China Trade Deal

The market already expects a trade deal – a good trade deal. I think that is a dangerous position for the United States because it puts President Trump in a position where he really has to deliver.