Price Of Gold

The Price Of Gold And The Price Of Silver Are Both Soaring Into The Stratosphere As The Global Economy Collapses

For years, some of the brightest minds in the precious metals industry warned that the price of gold and the price of silver would both rise dramatically once the global economy inevitably collapsed, and it turns out that they were right on target.  What we have been witnessing over the last several weeks has been nothing short of stunning, and many experts believe that this is just the beginning.  But I was actually going to write about something completely different today.  A major skirmish between Israel and Hezbollah along the Lebanese border put the entire region on edge for a few hours, but things appear to have cooled off for the moment.  So it doesn’t look like a huge regional war in the Middle East will start today, but as I discuss in my brand new book, it is just a matter of time before a massive conflict does erupt and I will be watching developments very closely.

There are so many elements of “the perfect storm” that is now upon us, and global events are happening so fast that it is hard to keep up with them all.  But one thing that you can pretty much count on is that almost every piece of bad news is going to be good news for the price of gold and for the price of silver.

All over the world, national governments have responded to the COVID-19 pandemic by recklessly spending money, and central banks have responded by engaging in a money creation spree that is unlike anything we have ever seen before.

As currencies all over the globe are being devalued at a staggering rate, it was inevitable that we would see gold and silver rise, and that is exactly what we have witnessed.  In fact, on Monday the price of gold set a brand new record high…

Gold touched record prices as worries over issues such as the coronavirus pandemic as well as U.S.-China tensions weighed on investor sentiment.

Spot gold traded up 1.9% at about $1,938.11 per ounce after earlier trading as high as $1,943.9275 per ounce. Those levels eclipsed the previous record high price set in September 2011.

On a percentage basis, the price of silver is actually moving even faster than the price of gold, and on Monday we witnessed a move which surprised just about everyone…

At the close of trading today, the silver price surged by nearly $2. According to Kitco.com, silver closed at $24.72, up $1.91 for the day. I can’t remember the last time silver jumped nearly $2 in one day. Of course, last Tuesday and Wednesday were big days for silver, but not $2.

What is interesting about the last few minutes of trading, silver closed right at the highs. So, it’s going to be interesting to see what happens in early Asian trading if silver BREAKS above its new short-term resistance level.

As I write this article, the price of silver has now risen above 26 dollars an ounce, and overall it is up more than 90 percent since the middle of March…

Since mid-March, the price of silver is up more than 90%, making it one of the top-performing asset classes since the bear market low earlier this year. It’s also up more than 22% just during the month of July alone.

The rapid decline in the dollar, negative real yields, ballooning deficits and additional government stimulus likely on the way are all fueling the current precious metals rally. All of these factors support a further rally in commodities, but it’s also becoming one of the more crowded trades in the financial markets.

Meanwhile, the U.S. economy continues to deteriorate.  For a while, many in the mainstream media were touting the possibility of a “V-shaped recovery”, but now they are openly admitting that this is not going to happen.  For example, the following comes from a CBS News story that was just posted…

The economic recovery that began in May is sputtering. Recent data show Americans cutting their spending and many businesses re-closing their doors as the number of COVID-19 cases in the U.S. crosses 4 million, raising concerns about another slowdown in growth.

“The foundations to this recovery are cracking under the weight of a mismanaged health crisis,” Gregory Daco, chief U.S. economist at Oxford Economics, told investors in a report.

What this means is that even more businesses are going to fail and even more workers are going to get laid off.

In fact, MGM Resorts and other large casino operators in the Las Vegas area just sent out legal notices indicating that mass firings are coming…

Shares of MGM Resorts were falling over 6% in afternoon trading Monday after Las Vegas casinos notified their staff that if they weren’t recalled from furlough by August 31, they would subsequently be fired.

Major employers are required under the federal Worker Adjustment and Retraining Notification Act (WARN Act) to notify their workers when there are expected to be mass firings. MGM Resorts, Wynn Resorts, Tropicana and other casino operators sent out such notifications.

It is being reported that a “large majority” of MGM employees in the entertainment and sports division will lose their positions, and considering the fact that Las Vegas already has one of the highest unemployment rates in the entire nation it will certainly not be easy for them to find new jobs.

Elsewhere, United Airlines has announced that it may have to lay off as many as 36,000 workers.  That represents almost half of the U.S. workforce for the airline, and other major airlines are expected to make similar cuts.

Without jobs, a lot of unemployed workers are simply not going to be able to pay their bills, and CNBC is telling us that the U.S. may soon be facing “an unprecedented eviction crisis”…

An unprecedented eviction crisis will soon hit the U.S.

On Friday, the federal moratorium on evictions in properties with federally backed mortgages and for tenants who receive government-assisted housing expired. The Urban Institute estimated that provision covered nearly 30% of the country’s rental units.

Many states had instituted their own eviction moratoriums, but most of those are expiring as well.

Unless new moratoriums are established, millions of Americans will soon be facing eviction, and according to one estimate a grand total of 40 million Americans could potentially be evicted over the course of this entire pandemic…

The proceedings have resumed in more than 30 states.The moratorium in Hawaii and Illinois end this week, and in August, evictions will pick up in New York and Nevada.

By one estimate, some 40 million Americans could be evicted during the public health crisis.

Just think about that.

What is this country going to look like if 40 million people are thrown out into the street?

As I have always warned, this economic downturn is going to make the last recession look like a Sunday picnic.  The economic suffering is going to be off the charts, and at this point there isn’t too much that can be done to stop it.

Yes, Congress will pass more “stimulus bills” and the Federal Reserve will continue to create money at a staggering pace.

Those measures will only provide temporary relief for the real economy, but they will also be music to the ears of every gold and silver investor.

Things have gotten crazy, and they are only going to get crazier.  Hold on tight, because the rest of 2020 is definitely going to be quite “interesting”.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

We Are Being Warned That The Last Week Of August “Could Be Highly Volatile” For Global Financial Markets

Are things about to break loose in a major way?  At the end of last week, the trade war between the United States and China escalated dramatically, and investors all over the globe really started freaking out.  Unfortunately, developments over the weekend have only made things worse, and that means that this could be a very “interesting” week for global financial markets.  As I write this article, stock prices around the world are plunging, the price of gold is spiking and the Chinese yuan is crashing.  There is clearly a lot of fear out there right now, and at this point even CNBC is warning that the last week of this month “could be highly volatile”…

The final week of August — the bittersweet end of summer for many— could be highly volatile, as markets fret over the economy and the latest developments in trade wars.

Of course things can swing rapidly from moment to moment in this environment.  President Trump could say something in a few hours that temporarily gives investors some hope, and that could cause markets to swing wildly upward for a little while.  Everyone is on edge right now, and every piece of significant news is likely to cause gyrations in the marketplace.

But overall the trend is clearly down.  U.S. stocks have now fallen for four weeks in a row, and many are becoming deeply concerned about what September will bring.

And for many U.S. businesses, this trade war has turned into a complete nightmare.  Executives crave predictability, but now everywhere we look there is chaos, and this is causing a lot of headaches for business leaders…

Businesses crave predictability so they can make informed decisions and plan for the future. Many companies that depend on Chinese manufacturers and consumers have already shifted supply chains out of the country and taken other steps to reduce their exposure to China. And while Mr. Trump’s tweets are unlikely to trigger immediate changes, more uncertainty is unwelcome.

“Continued escalation and rhetoric are harmful to American businesses, workers and farmers,” said Tom Linebarger, chief executive of Cummins Inc., which makes diesel engines. Cummins pays a tariff on components it imports from its own plants in China for engines assembled at U.S. factories by American workers. The tariffs amount to a tax paid by Cummins’ customers, he said.

Unfortunately, nobody can no longer deny that global economic activity is really starting to slow down.  We just learned that global trade was down 1.4 percent in June from a year earlier, and that represented the largest decline that we have seen since the last financial crisis…

World trade volume – a measure of imports and exports of merchandise across the globe – declined in its zigzag manner in June to the lowest level since October 2017, according to the Merchandise World Trade Monitor by CPB Netherlands Bureau for Economic Policy Analysis. The index was down 1.4% from June 2018. This small year-over-year decline is the biggest year-over-year decline since the Financial Crisis, and it’s a reversal from the heady growth in 2017 and 2018 that had topped out at 6.7%.

I have been using phrases like “since the last financial crisis” and “since the last recession” in almost every article recently.  We are seeing so many things happen that we haven’t seen for a decade or longer, and yet most Americans still don’t seem to understand that we have a real crisis on our hands.

If the U.S. and China were to mend their relationship and agree to a comprehensive trade deal, that would certainly help things.

Unfortunately, that isn’t going to happen.

In fact, both sides appear to be digging in even more.  For example, the White House just told us that President Trump “regrets not raising the tariffs higher”…

When asked if Trump had second thoughts about Friday’s move to escalate the trade war with China, Trump said “Yup.” “I have second thoughts about everything,” he added.

Hours later, the White House issued a statement saying that Trump meant to say that he wished he had raised tariffs on Beijing even higher.

“His answer has been greatly misinterpreted. President Trump responded in the affirmative – because he regrets not raising the tariffs higher,” White House spokeswoman Stephanie Grisham wrote in a statement.

And the Chinese are warning that we should not “underestimate the determination” of the Chinese people and that they will be the ones to “have the last laugh”…

On Saturday, China’s commerce ministry issued a statement calling on Washington not to “misjudge the situation and underestimate the determination of Chinese people” after US President Donald Trump announced new tariffs on Chinese imports.

“The US should immediately stop its wrong action, or it will have to bear all consequences,” the statement said.

At the same time, a sharply worded commentary in the official party mouthpiece, People’s Daily, said China had the strength to continue the dispute and accused Washington of sacrificing the interests of its own people. Published under the pseudonym “Wuyuehe”, the piece described the latest tariff measures by the US as “barbaric”. The op-ed said China’s own tariffs on $75 billion worth of American products, announced late on Friday, were a response to America’s unilateral escalation of the trade conflict, and vowed that China was determined to fight back “until the end”.

“China’s will to defend the core interests of the country and the fundamental interests of the people is indestructible, and will not fear any challenge,” the author wrote, promising that “history will prove that the side on the path of fairness and justice will have the last laugh.”

As I have repeatedly warned, there isn’t going to be a trade deal before the 2020 presidential election.

So that means that things are going to get progressively worse, and we need to be prepared for a lot of economic pain.

At this point, even U.S. Senator Lindsey Graham is telling us that the American people are just going to have to “accept the pain that comes with standing up to China”…

Sen. Lindsey Graham, R-S.C., said on Sunday that Democrats should not criticize President Trump for taking on China over trade as they have complained for years about Beijing’s policies but done nothing.

“Every Democrat and every Republican of note has said China cheats,” Graham said on CBS News’ “Face the Nation.” “The Democrats for years have been claiming that China should be stood up to, now Trump is and we’ve just got to accept the pain that comes with standing up to China.”

Sadly, the truth is that the American people are not well equipped to deal with pain.  We have been spoiled by decades of debt-fueled “prosperity”, and even a relatively minor economic downturn would result in a massive national temper tantrum.

Right now our nation is a seething cauldron of anger and frustration, and the mainstream media is stirring the pot on a daily basis.  It isn’t going to take much to spark an explosion, and this will especially be true the closer we get to the next presidential election.

The season of “the perfect storm” is upon us, and what is coming next is going to be one of the most chaotic chapters in modern American history.

About the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Gold, Silver And Oil Are All Skyrocketing And That Is Bad News For The U.S. Economy

The following is one statement that you should get used to seeing: “The price of gold set another record today.”  Today, spot gold reached a new all-time record of $1461.91 an ounce before settling back a little bit.  Silver is also skyrocketing.  At one point today silver hit $39.75 an ounce.  It seems inevitable that at some point we are going to be talking about $50 silver.  The price of oil is also continuing to relentlessly march upwards.  At last check U.S. oil was at about $108 a barrel.  All of this is great news for those that are investing in gold, silver and oil, but all of this is also really bad news for the U.S. economy.  Why?  Well, because when these commodities go up in price it is a sign that the U.S. dollar is dying and that our country is getting closer to economic collapse.

Traditionally, there has been an inverse correlation between the price of gold and the value of the U.S. dollar.  Usually when the U.S. dollar goes down, the price of gold goes up.

One of the main reasons why gold has been so strong over the past year is because the U.S. dollar has been rapidly losing value.

So why is the U.S. dollar declining?

Most economists point to all of the quantitative easing that the Federal Reserve has been doing.

So exactly what is quantitative easing?

Well, it is basically like playing Monopoly with someone that reaches under the table and pulls out a bunch of extra money when they are almost broke.

The Federal Reserve has been creating huge amounts of money out of thin air and has been pumping it into the financial system.  It is essentially cheating, and it is highly inflationary.  The rest of the world has not been amused.

But quantitative easing is not the only issue.

The truth is that whenever the U.S. government goes into more debt, more money is created.  The U.S. has been running trillion dollar deficits for several years now, and this has created a lot of new money.

This is another reason why it is so important to get the U.S. government debt situation under control.  The Obama administration is projecting that the budget deficit for this fiscal year will be about 1.6 trillion dollars.  This is highly inflationary and it will continue to destroy the value of the dollar.

In addition, the rest of the world is beginning to have serious doubts about the sustainability of U.S. government debt.  They are starting to lose faith in the U.S. dollar and in U.S. Treasuries.

In fact, investors are losing faith in paper currencies all over the globe.  The euro is on the verge of a massive crisis.  On Tuesday, Moody’s downgraded Portuguese government debt for the second time in a month.  Portugal needs a bailout, but they are far from alone.  A half dozen European nations are experiencing a financial meltdown and the European debt crisis could spiral out of control at any moment.

Because of all of this financial instability, investors have been seeking some place safe to put their money.

For many investors, precious metals and commodities have been the answer.

In fact, silver has been doing even better than gold lately.  On Wednesday, silver set a new 31-year high for the third day in a row.

People are even starting to talk about the possibility of $50 silver.  Most analysts would have considered such talk complete nonsense a year ago.

But now nobody is laughing.

The price of oil is also soaring.  Some of that is due to inflation, but not all of it.  The truth is that when it comes to oil there are other factors at play.

Unfortunately, a high price for oil is far more damaging to the U.S. economy than a high price for gold is.

The U.S. economy has been designed to use massive amounts of cheap oil to transport massive quantities of goods over vast distances.  When the price of oil goes to $100 or $150 a barrel, it fundamentally changes the dynamics of our economic system.

Nobody has ever been able to prove that the U.S. economy can successfully handle a price for oil over $100 for an extended period of time.

Do you remember what happened back in 2008?  The price of oil hit a record high in June and then the entire financial system came unglued just a few months later.

The price of oil affects the price of almost everything else.  Almost all forms of economic activity use energy.  Almost all goods have to be transported a significant distance.

When the price of oil goes too high, some types of economic activity simply become unprofitable.  If the price of oil stays this high from now on, there are many businesses across America that will be forced to close.

A high price for oil is also going to hit U.S. consumers really hard.  According to AAA, the average price of a gallon of gasoline in the United States is now $3.70.

Many are convinced that the average price of gasoline is going to shatter the all-time record of $4.11 that was set back in July 2008.

So how much did a gallon of gas cost a year ago?

One year ago the average price of a gallon of gasoline was just $2.83.

Over the past 12 months the average price of gasoline has gone up about 30%.

So has your paycheck gone up by 30% over that time?

The truth is that wages have been very stagnant in the United States for a long, long time.

That means that U.S. household budgets are being increasingly stretched.  People have to fill up their cars so that they can get to work or to school.  Americans can cut back on pleasure driving to save money, but most of the driving that all of us do is to get to places that we have to be.

So if gas costs more that means that consumers are going to have less to spend other places.  Consumer spending accounts for approximately 70 percent of the U.S. economy, so any slowdown in U.S. consumer spending would be extremely significant.

Already a substantial percentage of the American people are feeling quite stressed about gas prices.

According to a recent Associated Press-GfK poll, approximately two-thirds of the American people believe that rising gasoline prices will cause significant hardship for their families over the next six months.

We are heading for some really difficult economic times.  As I wrote about recently, this economy has millions of Americans feeling depressed, but that is not the appropriate response.

Rather, once we understand how bad our economic problems are we should feel empowered because then we can start focusing on real solutions.

And somebody really needs to start focusing on solutions because panic is starting to abound.  Many top corporate insiders are selling off stock like there is no tomorrow.  The biggest bond fund in the world, PIMCO, has been getting rid of all of their U.S. Treasuries.  When Wall Street big shots start freaking out you know that the hour is late.

It certainly doesn’t help that the Middle East is in a state of chaos and that the Japanese economy is falling apart as a result of the recent disasters.

In these uncertain times investors are seeking something safe.  They are turning to real “global currencies” such as gold, silver and oil.  Paper currencies are rapidly losing favor and rampant inflation is on the horizon.

So where do all of you think that gold, silver and oil are going?  Feel free to leave a comment with your opinion below….

Inflation Is Here – Just Open Up Your Eyes And Look At These 5 Financial Charts!

Despite what Federal Reserve Chairman Ben Bernanke says, rampant inflation is officially here.  The federal government is constantly monkeying with the numbers to keep the “official” rate of inflation below 2 percent, but it is becoming very difficult to deny that the cost of almost everything is really going up these days.  The American people are not stupid.  They notice the difference when they go to the grocery store or stop at the gas station.  The dollar is losing value rapidly now.  The price of gold set another new all-time record today and is currently hovering just above $1430 an ounce.  The price of West Texas crude has moved above 100 dollars several times recently and the price of Brent crude is currently above 116 dollars.  These higher oil prices are really starting to be felt in the United States.  The average price for a gallon of gasoline in the United States has now reached $3.38.  There are some gas stations in the U.S. where the price of a gallon of gas is already over 4 dollars.  But it is not just the American people that are feeling the pain.  The global price of food recently hit a new record high and almost every major agricultural commodity has absolutely skyrocketed in price over the past 12 months.  Meanwhile, Ben Bernanke just told the Senate Banking Committee that he really isn’t concerned about inflation at all.

When it comes to inflation, the key is not to look at the official U.S. government numbers (they are highly manipulated) or how the U.S. dollar is performing against other major currencies (because they are all being devalued as well).  Instead, you can get a truer sense of what is really happening to inflation by looking at what the U.S. dollar is doing against precious metals, commodities and other hard assets.

So are we experiencing rampant inflation right now?  Well, just open up your eyes and look at these 5 charts….

1 – The price of oil is racing back up to record levels.  The chart below from the Federal Reserve is a couple weeks out of date.  As noted above, the current price of West Texas crude is about $100 a barrel….

2 – The price of a gallon of gasoline in the United States seems destined to hit a brand new all-time record at some point this year.  Was it really just a few short years ago when the average price of gas in this country was about a dollar a gallon?….

3 – The value of most precious metals is very consistent over time.  So when you see precious metals go up dramatically in price, it means that the dollar is being devalued.  The price of gold just set another new all-time high and it seems destined to keep going even higher….

4 – The chart below from the Federal Reserve is a measure of the price of all commodities.  These price increases are inevitably going to be passed along to consumers in the United States….

5 – After a couple of years of stable food price, the price of food is starting to take off yet again….

In fact, many analysts are warning that we could experience a major food crisis over the next couple of years.  The global demand for food continues to grow at a very brisk pace, but all of the crazy weather we have been having around the world has caused some very bad harvests.

Unfortunately, the global price of food has gone up substantially in recent months and it is likely to keep going up very rapidly.  Just consider the following five facts….

#1 The United Nations says that the global price of food hit another new all-time high during the month of January.

#2 The price of corn has doubled in the past six months.

#3 The price of wheat has roughly doubled since the middle of 2010.

#4 According to Forbes, the price of soybeans is up about 50% since last June.

#5 The United Nations is projecting that the global price of food will increase by another 30 percent by the end of 2011.

Ouch.

But isn’t there some good economic news?

Yes, there is, but before we cover it, it is important to keep in mind that in an inflationary environment almost all economic numbers go up.

For example, during the recent hyperinflation in Zimbabwe stocks went up like crazy and “economic growth” statistics were very impressive.

Why?

Because those numbers were measured in currency units that were being devalued at a blinding pace.

So please keep that in mind when you hear “good economic statistics” on the evening news.

The truth is that in an inflationary environment such as we have now entered into almost all economic numbers should be going up.

So what is the good news?

Well, last month all three major U.S. car companies reported strong sales gains.  Sales of GM vehicles were up 49%, sales of Chrysler vehicles were up 13%, and sales of Ford vehicles were up 10%.

But just because a few pieces of good economic news come floating our way does not mean that we should forget all of the horrific long-term economic trends that are tearing this country apart.

The truth is that we are still a nation that is absolutely drowning in debt.

For example, it was just announced that China now owns 1.16 trillion dollars of U.S. government debt.

The borrower is the servant of the lender.  We should never forget that.

Also, the U.S. economy is slowly but surely becoming of less importance on the global stage.

In 1985, America’s share of global GDP was 33%.  Today, it is just 24%.

Our nation is rapidly being deindustrialized and we are becoming deeply dependent on industrial production from other nations.

Did you know that the new World Trade Center that is being constructed on the site of the September 11, 2001 attacks is going to be made from German steel and Chinese glass?

That says a lot about where we are at as a country.

We have allowed so much of our industrial infrastructure to be exported to China where workers slave away in almost unbelievable conditions.

A reader named Rish recently described what things are like over there….

As a product developer I went to china and saw the way the factory workers lived and worked in person. 50$ a month is about right, but if you are a skilled quality control expert you might make as much as 150$. at least this was true about 2 years ago the last time I went. The barracks were pretty meager, bunk beds with just plywood, no mattresses, if you wanted you could go to a store just outside the factory gate and buy a thick comforter that they sell as a “mattress” .

It will be interesting to see how the next few years changes the face of the USA. Who knows? if the unemployment rate and lack of jobs keeps going and enough people become homeless, we might become the next Bangladesh, and people will be lining up of the 30 cents an hour corporate factory jobs, and living in barracks just like those…

The only way the U.S. has been able to “thrive” during this deindustrialization is by borrowing gigantic amounts of money.  But all of this borrowing is slowly but surely destroying the U.S. dollar, and we are getting closer to the point of absolute catastrophe.

Peter Schiff recently shook folks up when he talked about these issues during a recent interview on CNBC….

But it is not just the United States that is printing tons and tons of money.  All of the major industrialized nations have been firing out gobs of currency.  That is a huge reason why so many investors have been racing to get into hard assets recently.

Now Ben Bernanke and other top Federal Reserve officials have been dropping hints that more quantitative easing may be necessary.

Unfortunately, just like with any other addiction, once you give in a few times it becomes easier and easier to engage in destructive behavior.  Now that the Fed has gotten a taste for quantitative easing it is going to be really hard to stop.

Nor can the Fed stop at this point.  If they did it would be disastrous for the U.S. economy.  But if the Fed continues on this reckless course it will make the eventual collapse of our economy even worse.

Under our current debt-based system there is no way out.  The Federal Reserve can attempt to put off the inevitable for a while by pumping up the debt bubble even more, but at some point it is going to burst.

When that happens we are going to be facing a financial crisis which will blow what happened in 2008 completely out of the water.

So enjoy these good economic times while you still can.  This is about as good as things are going to get from here on out.