Wednesday , April 21 2021
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Tag Archives: Chart Update

You Can’t Eat Gold – Precious Metals Supply and Demand

  You Actually Can Eat Gold, But Its Nutritional Value is Dubious “You can’t eat gold.” The enemies of gold often unleash this little zinger, as if it dismisses the idea of owning gold and indeed the whole gold standard. It is a fact, you cannot eat gold. However, it dismisses nothing. Over-the-top garnish: Gold leaf-laced donut (reportedly costs $100), gold-laced cakes, sushi roll with gold leaf (according to Japanese lore, eating it...

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Bad Hair Days Are Back – Is the Stock Market Oversold Enough?

    A Quick Look at a few Technical Yardsticks and Comparisons We went through numerous charts and data over the weekend to provide a snapshot of where market currently stands. This is in context with our idea that sudden downturns in the form of mini-crashes are likely to happen with very little advance warning, mainly due to market structure issues (the vast increase in systematic trading strategies) and the unique post “QE”...

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Are Credit Spreads Still a Leading Indicator for the Stock Market?

  A Well-Established Tradition Seemingly out of the blue, equities suffered a few bad hair days recently. As regular readers know, we have long argued that one should expect corrections in the form of mini-crashes to strike with very little advance warning, due to issues related to market structure and the unique post “QE” environment. Credit spreads are traditionally a fairly reliable early warning indicator for stocks and the economy...

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Fed Credit and the US Money Supply – The Liquidity Drain Accelerates

    Federal Reserve Credit Contracts Further We last wrote in July about the beginning contraction in outstanding Fed credit, repatriation inflows, reverse repos, and commercial and industrial lending growth, and how the interplay between these drivers has affected the growth rate of the true broad US money supply TMS-2 (the details can be seen here: “The Liquidity Drain Becomes Serious” and “A Scramble for Capital”). The Fed has...

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Miraculous Credit Spreads – Precious Metals Supply and Demand

  Running From “Risk-Free” to Not So Risk-Free Debt  The price of gold blipped $13 last week, while the price of silver was unchanged. Speaking of interest rates and central planning by central banks, we note that in mid-2016, a correction (counter-trend move to the main trend) began in 10-year bond yields. 10-year treasury note yield vs. 10-year German Bund yield over the past decade [PT] It occurred at the same time in the Swiss...

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US Stocks and Bonds Get Clocked in Tandem

    A Surprise Rout in the Bond Market At the time of writing, the stock market is recovering from a fairly steep (by recent standards) intraday sell-off. We have no idea where it will close, but we would argue that even a recovery into the close won’t alter the status of today’s action – it is a typical warning shot. Here is what makes the sell-off unique:   30 year bond and 10-year note yields have broken out from a lengthy...

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In Gold We Trust – Incrementum Chart Book 2018

    The Most Comprehensive Collection of Charts Relevant to Gold is Here Our friends from Incrementum (a European asset management company) have just released the annual “In Gold We Trust” chart book, which collects a wealth of statistics and charts relevant to gold, with extensive annotations. Many of these charts cannot be found anywhere else. The chart book is an excellent reference work for anyone interested in the gold market and...

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Yield Curve Compression – Precious Metals Supply and Demand

  Hammering the Spread The price of gold fell nine bucks last week. However, the price of silver shot up 33 cents. Our central planners of credit (i.e., the Fed) raised short-term interest rates, and threatened to do it again in December. Meanwhile, the stock market continues to act as if investors do not understand the concepts of marginal debtor, zombie corporation, and net present value. The Federal Reserve – carefully inching...

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Theoretical Basis of Fundamental Gold Price Calculation – Precious Metals Supply and Demand

    Speculators vs. Arbitrageurs The price of gold rose six bucks, and the price of silver rose 26 cents last week. Before we look at the graphs, we want to address a reader question. This week, someone asked about how we calculate the Monetary Metals  fundamental gold price. The theoretical fundamental gold price (black line) vs. the market price for gold since late 2015. Worth noting: most of the time, the fundamental price is leading...

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Gold and Gold Stocks – Small Rays of Light in the Vale of Tears

  A Rebound Gets Underway – Will It Have Legs? Ever since the gold indexes have broken below the shelf of support that has held them aloft since late 2016 (around 165-170 points in the HUI Index), the sector was not much to write home about, to put it mildly. Precious metals stocks will continue to battle the headwinds of institutional tax loss selling until the end of October, to be followed by the not-quite-as-strong headwinds of...

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