Markets: US Dollar, Gold and Interest Rates

If the Federal Reserve doesn't raise interest rates in June it is going to shock the markets. In fact I think the US Dollar is poised to decline even if the Federal Reserve raises interest rates. I think gold (SPDR Gold Trust ETF (GLD)) is poised to rise even if the Federal Reserve raises interest rates but if it doesn't obviously those moves will be even bigger because the markets are completely prepared for a another hike.

U.S. Economy: Recent Weakness Likely To Persist

The economic data that has come out recently including this week has been pretty bad on balance in fact the data that we're getting confirms to me that rather than being transitory the weakness in the first quarter is likely to continue.

Markets: Gold, Silver, US Stocks

So far in 2017 the S&P 500 Index (SPDR S&P 500 Index ETF (SPY)) is up just under 7 percent but the price of gold (SPDR Gold Trust ETF (GLD)) and silver (iShares Silver ETF (SLV)) are up about 7.5%

Now despite the fact that both precious metals and the US stock market have performed about the same thus far in 2017, Americans are rushing to buy US stocks yet they're completely ignoring precious metals. This despite the fact that the Dow Jones Industrials (DJIA) or the S&P 500 Index (SPDR S&P 500 Index ETF (SPY)) is at an all-time record high and the valuations are clearly in bubbled territory. Yet when it comes to gold and silver even though they're doing well this year, gold prices are about 30 percent below their peak price in 2011 and silver is better than 60 percent below its peak price. 

So despite the fact that gold and silver are outperforming the S&P 500 Index (SPDR S&P 500 Index ETF (SPY)) this year they have a much further way to go to get back to their highs.