Category | Economic and Geopolitical News
Posts by Kirill Zagalsky
DOLLAR DOOM
The dollar will fail…. This is not a question of if but rather when. We believe that when the dollar does fail, it will create a period of economic and geopolitical chaos the likes of which this country has not seen before. Fiat currencies such as the dollar are fundamentally flawed. To the average investor, discussions on the dollar’s loss of value-or any other fiat currency for that matter- seem complicated and difficult to comprehend. In reality, there are very simple reasons why fiat or... Continue Reading
Category | Economic and Geopolitical News
IS DEFLATION A RISK?
With all the recent talk of the possibility of inflation bottoming in the U.S., we felt it prudent to discuss the other side of the coin a bit. Deflation is a decline in the general price levels of goods and services. An economy is said to be experiencing deflation when the inflation rate falls below zero percent. A CPI reading of -.1 percent, for example, would indicate that prices have dropped as much. The U.K. has just apparently entered deflation with year-over-year consumer prices falling... Continue Reading
Category | Economic and Geopolitical News
IS GOLD ON THE VERGE OF A BREAKOUT?
As we have stated regularly for some time now, the global financial landscape appears to be headed for some significant changes. These changes may affect how investors look at various financial markets and may be the catalyst for a large shift in both investor allocation and sentiment. What are some of the issues we are referring to? There are several noteworthy issues in play right now that may significantly impact financial markets. Here we will briefly outline just a few, and discuss why these issues... Continue Reading
Category | Market Update
Are Stocks Ready to Tumble?
Stocks are under some pressure recently as the risk of a Greek default and the notion of higher interest rates take their toll on investor sentiment. The question is: Is recent weakness seen in equities simply another pullback or is it indicative of more volatility and lower prices to come? Like anything else in life, different investors will have different opinions on this. We do believe, however, that the stock bears do have a case. Stocks are now in the seventh year of the rally... Continue Reading
Category | Market Update
Greek Gold
Without question, one the main themes in financial circles this past year has been the ongoing troubles in Greece and its economy. We thought it might be prudent to provide a little background on this situation, and how it may potentially impact not only gold and precious metals but global financial markets. First off, the Greek Government, like many if not all modern day governments, relies on borrowed money to fund its operations. Greece was hit particularly hard during the recent recession, and tax revenues... Continue Reading
Category | Economic and Geopolitical News
Mixed Signals
Following this morning’s release of non-farm payrolls data for April, one could certainly characterize the reaction among various markets as being “mixed.” According to the U.S. Department of Labor, the country added 223,000 jobs last month while the unemployment rate ticked lower to 5.4 percent-the lowest level in seven years. The less talked about “participation rate”, which indicates the percentage of working-age people who are employed or actively looking for work, came in at 62.8%- matching the lowest since 1978. Stocks cheered the headline number,... Continue Reading
Category | Market Update
Larry Summers Warns US Is Losing Its Global Leadership Role
“This past month may be remembered as the moment the United States lost its role as the underwriter of the global economic system.” —Larry Summers, Harvard professor and past U.S. Treasury Secretary, wrote in an April Washington Post article. The global economic and political power tides are shifting from West to East. China is flexing its economic muscle and the balance of global power scales are beginning to tip in their favor. This month China announced the formation of the Asian Infrastructure Investment Bank (AIIB),... Continue Reading
Category | Economic and Geopolitical News
Is Greece Teetering On The Edge Of Default?
Black Storm Cloud Looms Over Greece And The Global Horizon The clock is ticking toward a Greek debt default which could jettison the country from the euro-single currency bloc. A “Grexit” or Greek exit from the euro zone could catapult the region and the globe back into financial crisis and political turmoil. A Greek exit would have far reaching implications not only for contagion within the euro zone, but would also raise concerns about the viability of paper currencies, and the subsequent shifting global power... Continue Reading
Category | Economic and Geopolitical News
Even Gold Mining Companies Have Problems
So you’ve got a hole in the ground and you’re mining a precious metal and selling it on the open market. What could possibly go wrong? Plenty, actually. The gold mining industry as a whole is nearing a point where they’ll need to reduce output or even shut down some of their operations completely. With the price of gold reaching a four-year low, mines are being forced to slash costs and rethink their strategies. Gold prices have lost ground to the U.S. dollar which has... Continue Reading
Category | Gold