Article Category: Gold

The Winners and Losers from Higher Rates

Investors are once again battening down the hatches, preparing themselves for rough conditions stirred up by the Fed's weather system. The FOMC's latest remarks, combined with last Friday's strong jobs report, have convinced many investors that the first rate hike will happen in December.

Fed funds futures currently indicate a two-thirds possibility of a rate hike at the December meeting. In preparation, investors are moving money out of interest rate sensitive areas and into pockets of the market that do well with higher rates.


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Posted in: Federal Reserve Gold Inflation Interest Rates Momentum Volatility

Trend is Changing

It's Columbus Day in the states and action across financial markets is subdued as the U.S. bond market remains closed for the holiday. With debt trading on pause, we can focus on equities, which have been working their way higher.

The last few months have been unkind to stocks, but lately we've seen buyers step in and provide support.

Dow Theory recently turned bearish, but looks to have reversed that signal on Friday. Below we see both averages confirming one another as they trace out new short-term highs. Let's walk through the price action in more detail.


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Posted in: Dow Theory Federal Reserve Gold Interest Rates Volatility

Conditions Are Improving, Not Deteriorating

At least that's what the latest update from The Conference Board says. Released yesterday, the figures for June suggest that not only is the US economy improving, but it will continue to do so.

The Conference Board's Leading Economic Index (LEI) has a strong history of accurately predicting periods of weakness in the economy (see chart below). It accomplishes this by aggregating 10 leading indicators that generally turn first when an economic slowdown is approaching.


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Posted in: Earnings Economy Gold Interest Rates Momentum Oil

China Accumulates Gold, U.S. Stocks Strengthen

After six years of silence, China has finally released an update on their gold holdings. As of June, the People's Bank of China (PBOC) owns 53.32 million troy ounces. This represents a 57% increase from the last time they reported, back in April of 2009.

With the additional gold, China moves into the number five spot in terms of total government holdings. Topping that list is the U.S. with a supposed 261.5 million ounces of gold. The next three largest owners of gold are Germany, Italy and France.


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Posted in: Corrections Dividends Earnings Gold Interest Rates Oil

Yellen Back In Focus, Gold Reacts Poorly

At last the market's focus is shifting back to where it ought to be, economic fundamentals and the outlook for corporate earnings. That, and of course central bank policy, which recently took a back seat to fireworks in Greece and China.

Yellen testified in front of Congress this week and her message was clear. She prefers the risk of an early rate hike or two over the risk of waiting too long and having to play catch-up.


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Posted in: Compounding Dividends Federal Reserve Gold Interest Rates

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