Steve Bull's Blog, page 33
May 18, 2024
Why The Gold Rush Is Just Beginning, In Six Charts
A lot of embarrassed investment advisors out there…
Gold blew through $2400/oz this morning:
And the world’s central banks continue to add gold to their monetary reserves. Note that the real action coincided with the outbreak of the Ukraine war, when the US started slapping sanctions on everyone in sight. De-dollarization is a trend with legs.
A case can be made that China alone is driving the current gold bull market. Note how the metal’s price tracks the increase in People’s Bank of China gold reserves.
Silver just pierced its 5-year resistance. If it holds above $30/oz, $35 becomes the next big test.
One of the problems with gold miner stocks has been the fact that mining costs are rising, which offsets some of the benefits of a higher gold price. But that’s changing, as gold rises faster than mining costs, widening miners’ margins and lighting a fire under their stocks. See Finally, Some Good-Looking Gold/Silver Miner Charts.
The Next Price Driver
Is the gold rush played out? Well, 98% of mainstream investment advisors currently have less than 5% of their clients’ money in precious metals. Imagine all the tense upcoming meetings in which clients demand to know why they don’t own the year’s best-performing assets — and advisors apologize and promise to add gold to their mix. Just 1% of global investible capital flowing into gold would send it to the moon.
US Power Grid May Become Unreliable This Summer, Watchdog Warns
Parts of America could face difficulties in meeting electricity demand during the summer season, with renewable energy sources like wind and solar power posing a potential risk to reliable power supply, according to a report by the North American Electric Reliability Corporation (NERC).
The NERC report classifies several parts of the country as facing an “elevated” risk of summer electricity reliability for the upcoming June-September period.Elevated risk means there is “potential for insufficient operating reserves” when the region faces above-normal demand conditions. Such regions include parts of Louisiana, Texas, New Mexico, Arizona, California, Illinois, and Iowa. The determination of elevated risk is based on various factors, including potential low wind or solar energy conditions that could lead to a lower electricity supply.
The North American power bulk power system (BPS) is made up of six regional entities—Midwest Reliability Organization (MRO), Northeast Power Coordinating Council (NPCC), ReliabilityFirst (RF), SERC Reliability Corporation (SERC), Texas Reliability Entity (Texas RE), Western Electricity Coordinating Council (WECC)—with elevated risk upcoming in certain regions.
Midcontinent Independent System Operator (MISO), which manages the electricity capacity market, operates in 15 U.S. states, including Texas, Illinois, Montana, Arkansas, and Kentucky. MISO is expected to have “sufficient resources” to meet normal summer peak demand, the NERC report said.However, if MISO were to face above-normal peak demand conditions at a time when wind and solar output is lower than expected, it could be “challenging” for the transmission organization to meet demand.
…click on the above link to read the rest of the article…Al Gore Said the Ice Caps would be Gone by 2014 – Yes 2014!
The Press REFUSES to hold all of these failed Climate Change forecasts to test. All they do is keep moving the date for our doom, all due to CO2. In fact, the real crisis is the continued weakening of the magnetic field, which leads to pole shifts about every 43000 years – yes, that conforms to the ECM frequency. The major shifts we discovered from the data scientists provided us came out to be 720,000 years. Either way, they both seem to be lining up in our lifetime. We are headed more into a pole shift than a climate change thanks to CO2. The fact that they are targeting farmers when we should be stockpiling food now is either the most idiotic human decision in history or intentional with hopes of reducing the population.
If I keep forecasting every year that the stock market would crash by 90%, I think they would call me a nut-job and laugh after ten years of perpetual failed forecasts. But with the climate, they just love to keep the fraud going. After June 6th, they are whispering about restricting travel to reduce CO2 this summer. They want to deprive you of your vacation this year as well.
Precarious: One Misfortune Away from Insolvency
We can summarize the changes in our economy over the past two generations with one word: precarity, as life for the bottom 90% of American households has become far more precarious over the past 40 years, despite the rising GDP and “wealth” as measured in phantom capital.
This reality is expressed in the portmanteau word precariat, combining proletariat (someone whose livelihood comes from their labor) and precarious: outside of government employment, work has become far more precarious. Where it was still common 40 years ago to work for a company for much or most of one’s career and have a private-sector pension, now private-sector pensions have vanished, replaced by self-managed 401K funds, and private-sector work is characterized by a series of not just job changes but career changes.
The source of one’s livelihood can dry up and blow away almost overnight, and to fill the hole many turn to gig-work with zero benefits that saddles the worker with self-employment taxes (15.3% of all earnings, as the “self-employed” gig worker must pay both the employee and the employer shares of Social Security-Medicare payroll taxes).
This isn’t true self-employment, of course, as true self-employment means the owner-worker can hope to extract the full value of their labor; in contrast, much of the value of the gig work is skimmed off by corporate platforms (Uber et al.). The gig worker is a precariat wage-slave, not a self-employed owner of their own labor and enterprise.
Forty years ago, households with healthcare insurance being driven into bankruptcy by medical bills was unknown. Now this is commonplace. We’re forced to ask, what exactly does “insurance” even mean if our share of the medical bills is so burdensome that we’re forced into insolvency?
…click on the above link to read the rest of the article…
Birth Dearth or Baby Boom?
A new debate on where global population may be headed
Lots and lots of babies!Upgrade to paid
Writing in the Wall Street Journal earlier this week Greg Ip and Janet Adamy explored the possibility that the world’s population may peak and begin to fall far sooner than demographers have previously projected:
The world is at a startling demographic milestone. Sometime soon, the global fertility rate will drop below the point needed to keep population constant. It may have already happened.
Fertility is falling almost everywhere, for women across all levels of income, education and labor-force participation. The falling birthrates come with huge implications for the way people live, how economies grow and the standings of the world’s superpowers.
Source: UN 2022The United Nations, in its World Population Prospects 2022, projected in its medium variant scenario that global population would peak in the 2080s at about 10.4 billion people. The WSJ reports that figure represents a substantial drop from U.N. projections just five years earlier: “In 2017 the U.N. projected world population, then 7.6 billion, would keep climbing to 11.2 billion in 2100.”
The Institute for Health Metrics and Evaluation (IHME) at the University of Washington in 2020 projected a global population in 2100 of about 1.5 billion less than the United Nations:
In the reference scenario, the global population was projected to peak in 2064 at 9.73 billion (8.84–10.9) people and decline to 8.79 billion (6·83–11·8) in 2100.
Both the U.N. and IHME foresee projected 2100 population to be less than demographers had previously projected. The trend in population projections for these organizations is down.
In contrast, the International Institute for Applied Systems Analysis (IIASA) in a recent update to its Shared Socioeconomic Pathways scenarios increased its 2100 population projection by more than 1 billion people in its “middle of the road” scenario:
…click on the above link to read the rest of the article…
How Powell Destroyed His Inflation War as he Eats the Poor
I’m going to save discussion of today’s CPI report for my Deeper Dive this weekend because it requires digging deep into the numbers involved in the report to show why it is not the game-changer for the new trend in inflation that the stock market made it out to be today. Not even close. It could, of course, become a first blip in the direction of a new downward trend against the rising trend for inflation that has held all year, but this year’s trend, so far, remains firmly anchored.
Even Minneapolis Federal Reserve Bank President Neel Kashkari said today, after the CPI report came out,…
that he is unsure how restrictive monetary policy is right now, and that borrowing costs should stay where they are as U.S. central bankers take stock of inflation. “The biggest uncertainty in my mind is how much downward pressure is monetary policy putting on the economy? That’s an unknown,” Kashkari told the Williston Basin Petroleum Conference in Bismarck, North Dakota. “And that tells me we probably need to sit here for a while longer until we figure out where underlying inflation is headed before we jump to any conclusions.”
In fact, another article out today claims, as I’ve been claiming here, that Fed policy is not restrictive at all; and that’s the interesting point for the day I want to focus on as I think the article says it well:
Time and again, Jerome Powell has made it clear. Financial conditions, the Federal Reserve’s key lever for cooling the US economy, are tight.
HOWEVER …
After an $11 trillion rally in US equities since late October — and the sudden revival of meme-stock fever — many on Wall Street think he’s dead wrong…
…click on the above link to read the rest of the article…
May 17, 2024
The Decay of Everyday Life
So where does this leave us? We’re on our own.
This month I’ve described what can be summarized as The Decay of Everyday Life: the erosion of the fundamental elements of everyday life: work, opportunity, social mobility, security and well-being, which includes civility, conviviality and a functional, competent social-political order.
In other words, Everyday Life includes far more than the financial statistics of Gross Domestic Product (GDP), the stock market, wealth and income. Everyday Life is fundamentally about relationships, agency (i.e. control of one’s life and ownership of one’s work), the fulfillment of life’s purposes (livelihood, family, friends, community and self-growth), leisure time and the experiences of everyday living, both the stressors and the joys.
As I’ve explored in recent posts, the experiential elements of Everyday Life have decayed over the past 40 years: life is more difficult and less secure in ways that are not offset by technological advances. Indeed, the most highly touted technological advances (Internet and mobile phones) have increased the burdens of shadow work and introduced new pathways of addiction and stress that have reduced well-being. Rather than being free, they include structures of control that we have yet to grasp, much less limit.
Here are my recent posts:
Precarious: One Misfortune Away from Insolvency
Squeezed for Decades, America’s Working Class Is Finally Up Against the Wall
Lost in the Vast Wasteland of Social Media
Hikikomori and Lying Flat: When “Making It” Becomes Hopeless
Withdrawing from the Rat Race Is Going Global
The Decay of Everyday Life echoes the title of one of the more important books I’ve long recommended, The Structures of Everyday Life Civilization and Capitalism, 15th-18th Century Volume 1 by Fernand Braudel. The book outlines how changes in the economic structure led to changes in everyday life.
…click on the above link to read the rest of the article…
“The Economics Just Don’t Work”: Demand For Electric Semis Plunges Due To High Costs
For the last year, we’ve been writing extensively about how high costs and low demand have made EVs uneconomical – and, as a result, unpopular to produce – for the auto industry.
It turns out unionized employees extorting you on labor costs while the government mandates you produce a money-losing product isn’t a combination that leads to prosperity and profit. Go figure.
Now, it isn’t just car manufacturers that are balking from the idea of all electric vehicles: the trucking industry, once expected to eventually make the shift to all electric as well, is seeing tepid demand for new rigs, according to a new Wall Street Journal article.
“The economics just don’t work for most companies,” Robert Sanchez, the chief executive of Ryder, said earlier this month.
Ryder’s experience highlights the difficulties state and federal governments encounter in encouraging truckers to transition from polluting diesel rigs to zero-emissions vehicles, the report says.
It also indicates that significant improvements in battery weight, range, and charging times are necessary for battery-electric trucks to effectively compete with diesel rigs in the cost-sensitive freight industry.
Rakesh Aneja, head of eMobility at Daimler Truck North America, told Wall Street Journal: “Quite frankly, demand has not been as strong as what we would like.”
Aneja said orders for its Freightliner eCascadia battery-electric semi truck are about the same this year as they were in 2023.
Battery-electric trucks are about three times more expensive than diesel rigs, the Journal notes. And while federal and state programs help offset purchase costs, significant hurdles remain due to high operating costs and setup challenges.
Truckers find these electric trucks difficult and costly to run, with installation of on-site charging facilities taking years. These trucks travel less than half the distance of diesel rigs per charge and require several hours to recharge.
…click on the above link to read the rest of the article…
Hezbollah launches first-ever Lebanese airstrike on Israeli base
The resistance group used, for the first time, a drone equipped with two missiles to attack Israel’s Metulla site
(Photo credit: X)Hezbollah launched the first-ever Lebanese airstrike on an Israeli target on 17 May, using a never-before-seen drone for the operation.
“In support of our steadfast Palestinian people in the Gaza Strip and in support of their brave and honorable resistance, the Islamic Resistance attacked at 1:38 pm on Thursday 5/16/2024 the Metulla site, its garrison, and its vehicles with an offensive drone armed with two S5 missiles,” Hezbollah said in a statement on Thursday afternoon, marking the sixth of 13 operations that day.
“When it reached its designated point, it fired missiles at one of its vehicles and the elements gathered around it, killing and wounding them. After that, it continued its assault on its designated target and hit it accurately,” the statement added.
The resistance group released footage of its drone strike on Metulla. Two missiles are seen being fired from each side of the drone, which then descends towards its final target and explodes.
Three Israeli soldiers were injured – with one seriously wounded – in the drone attack.
Coinciding with Israel’s brutal assault on Rafah and its relentless attacks across the Gaza Strip, Hezbollah has stepped up its operations in recent days.
While it has increasingly deployed the use of attack drones in its operations over the past several months, this is the first time a drone equipped with missiles has been used to attack targets from above – not only since the start of this war but for the first time in Lebanon’s history.
Hebrew news outlet Channel 13 noted on 16 May that Hezbollah’s attacks have become bolder and more sophisticated, and are resulting in more Israeli casualties.
…click on the above link to read the rest of the article…
Why the dollar will lose its status as the global reserve currency
By the early 400s, the Roman Empire was coming apart at the seams and in desperate need of strong, competent leadership. In theory, Honorius should have been the right man for the job.
Born into the royal household in Constantinople, Honorius had been groomed to rule, practically since birth, by the finest experts in the realm. So even as a young man, Honorius had already accumulated decades of experience.
Yet Rome’s foreign adversaries rightfully believed Honorius to be weak, out of touch, divisive, and completely inept.
He had entered into bonehead peace treaties that strengthened Rome’s enemies. He paid vast sums of money to some of their most powerful rivals and received practically nothing in return. He made virtually no attempt to secure Roman borders, leaving the empire open to be ravaged by barbarians.
Inflation was high. Taxes were high. Economic production declined. Roman military power declined. And all of Rome’s foreign adversaries were emboldened.
To a casual observer it would have almost seemed as if Honorius went out of his way to make the Empire weaker.
One of Rome’s biggest threats came in the year 408, when the barbarian king Alaric invaded Italy; imperial defenses were so non-existent at that point that ancient historians described Alaric’s march towards Rome as unopposed and leisurely, as if they were “at some festival” rather than an invasion.
Alaric and his army arrived to the city of Rome in the autumn of 408 AD and immediately positioned their forces to cut off any supplies. No food could enter the city, and before long, its residents began to starve.
Historians have passed down horrific stories of cannibalism– including women eating their own children in order to survive.
…click on the above link to read the rest of the article…
