Put your trust in gold

[ad_1]
<div _ngcontent-c14 = "" innerhtml = "

American confidence in institutions, from the federal government to the banks to the banks, has deteriorated for decades. Sixty years ago, three quarters of Americans thought that the government would act "most of the time" or "almost always". Today & # 39; hui, only one in five record level, think that our leaders make the decisions in the best interests of the country.

The news media are just as badly off. A new survey notes that Americans believe that "false information" is currently a bigger problem than violent crime, illegal immigration and terrorism.

Take a look at the chart below, based on Gallup polls dating back to 1973. What about news papers, TV news or, more recently, newsworthy? Online information, the faith of Americans is gradually eroding. Last year, the percentage of Americans who reported having "a lot" or "a lot" of confidence in newspapers was at an almost record low of 23%. Trust in television and online information was even weaker.

So where can you still trust the often cynical world of today? Friends and family. Our churches and other religious organizations. Our jobs

As an investor, I continue to trust gold as a store of value in times of economic and geopolitical uncertainty. He behaved exactly as I expected. In response to growing global trade concerns and the weakening of economic indicators, investors have been investing in the yellow metal, pushing its price up for a remarkable eight consecutive days starting last Friday. We have not seen such a series of victories since June 2014, as gold traded for 10 consecutive days.

By the end of last week, it was close to its 2019 peak of about $ 1,356 an ounce, which should prompt even more investors to withdraw and participate.

Indeed, a number of warning signs suggest that investors should proceed with caution while US economic expansion is 10 years old. Growth in global manufacturing is reversed for the first time since 2012, with the Purchasing Managers' Index (PMI) falling by a record 13 months in May.

This weakness has been highlighted in the monthly reports on automatic data processing (ADP) jobs by the federal government and payroll service providers. The Labor Department reported Friday that employment in the United States grew by only 75,000 in May, well below the 175,000 expected.

According to ADP, the United States added 27,000 jobs, making May the weakest month in terms of job gains in more than nine years. I do not know about you, but I can not help but read this as a direct negative consequence of the White House's growing trade war with China and earlier in the world. threat to impose a tariff on all imports from Mexico. The goods-producing sector in the United States was the hardest hit: construction lost 36,000 jobs, natural resources and extractive industries 4,000 and manufacturing 3,000.

The Mexican tariff of 5% was "suspended indefinitely," according to Trump on Friday night, in exchange for Mexico doing more to stem the flow of illegal immigration to the United States.

As I explained elsewhere, fares are essentially taxes and, as such, they are inflationary. This has historically supported the price of gold.

In addition to Walmart and Costco, a number of retailers told customers and investors that prices will go up thanks to the Chinese tariff. Discount retailer Five below said that it would probably be necessary to increase the prices of some items above $ 5 for the first time. General Dollar and Dollar Tree both warned buyers that they would "face higher prices as 2019 progresses".

Discussing the trade war, Michael Cembalest of JPMorgan, which hosts the "Market look" podcast, reminded listeners last week of an article written in August 2015 by Larry Kudlow, director of the Trump National Economic Council, and Trump's former choice for the Federal Reserve Board of Governors, Stephen Moore. In the article, titled "Why Trump's protectionist measures will hurt the economy" Kudlow and Moore compared Trump, then a candidate, to Herbert Hoover, the last Republican "trade protectionist".

"Trump aspires to be a 21st century Hoover with a modernized 1930 Smoot-Hawley fare platform that has plunged the United States and the global economy into a depression of more than 39, a decade and a collapse of the banking system? "

For better or for worse, we may have an answer to this question in the weeks and months to come.

What does the gold / silver ratio tell us

The gold / silver ratio is another sign of slowing economic growth. This ratio tells you how much ounces of money it takes to buy an ounce of gold. Last week, he crossed the 90 mark for the first time in 26 years, which means the money has not been as undervalued compared to gold since the first year of Bill's first term. Clinton.

The reason is that half of the money demand comes from industrial applications. When demand cools, the price of money drops. One of the main uses of metal is semiconductors, whose sales have declined. According to Association of Semiconductor Industry (SIA), Global sales reached $ 32.1 billion in April, a decrease of 14.6% from the same month last year. This is the deepest drop since the financial crisis.

The purchase of money could then be a challenging game, but I also recommend you keep a 10% weight in gold. Although the price of the yellow metal jumped last week, it is not yet fully overbought when you refer to the 14-day relative strength index (RSI). There may be additional upside potential, especially if Trump revisits the Mexican tariff.

For all information related to this position click here.

">

American confidence in institutions, from the federal government to the banks to the banks, has deteriorated for decades. Sixty years ago, three-quarters of Americans believed that the government would act "most of the time" or "almost always". Today, only one in five people, a near-record low, believes that our leaders make decisions in the best interests of the country.

The news media are just as badly off. A new survey reveals that Americans believe that "false information" is currently a bigger problem than violent crime, illegal immigration and terrorism.

Take a look at the chart below, based on Gallup polls dating back to 1973. What about news papers, TV news or, more recently, newsworthy? Online information, the faith of Americans is gradually eroding. Last year, the percentage of Americans who reported having "a lot" or "a lot" of confidence in newspapers was at an almost record low of 23%. Trust in television and online information was even weaker.

So where can you still trust the often cynical world of today? Friends and family. Our churches and other religious organizations. Our jobs

As an investor, I continue to trust gold as a store of value in times of economic and geopolitical uncertainty. He behaved exactly as I expected. In response to growing global trade concerns and the weakening of economic indicators, investors have been investing in the yellow metal, pushing its price up for a remarkable eight consecutive days starting last Friday. We have not seen such a series of victories since June 2014, as gold traded for 10 consecutive days.

By the end of last week, it was close to its 2019 peak of about $ 1,356 an ounce, which should prompt even more investors to withdraw and participate.

Indeed, a number of warning signs suggest that investors should proceed with caution while US economic expansion is 10 years old. Global growth in the manufacturing industry reversed for the first time since 2012, with the Purchasing Managers' Index (PMI) registering a record 13-month decline in May.

This weakness has been highlighted in the monthly reports on automatic data processing (ADP) jobs by the federal government and payroll service providers. The Labor Department reported Friday that employment in the United States grew by only 75,000 in May, well below the 175,000 expected.

According to ADP, the United States added 27,000 jobs, making May the weakest month in terms of job gains in more than nine years. I do not know about you, but I can not help reading this as a direct negative consequence of the White House's growing trade war with China and the earlier threat of imposing a customs duty on all imports from Mexico. The goods-producing sector in the United States was the hardest hit: construction lost 36,000 jobs, natural resources and extractive industries 4,000 and manufacturing 3,000.

The Mexican tariff of 5% was "suspended indefinitely," according to Trump on Friday night, in exchange for Mexico doing more to stem the flow of illegal immigration to the United States.

As I explained elsewhere, fares are essentially taxes and, as such, they are inflationary. This has historically supported the price of gold.

In addition to Walmart and Costco, a number of retailers told customers and investors that prices will go up thanks to the Chinese tariff. The discount retailer Five Below has indicated that it would probably need to increase the prices of some items over $ 5 for the first time. Dollar General and Dollar Tree both warned buyers that they would "face higher prices as 2019 moves forward."

Discussing the trade war, JPMorgan's Michael Cembalest, who hosts the "Eye on the Market" podcast, reminded listeners last week of an article written in August 2015 by Trump's director of the National Economic Council, Larry Kudlow, and his former choice for the Federal Reserve. Board of Governors Stephen Moore. In the article titled "Why Trump's protectionist measures are going to harm the economy," Kudlow and Moore unfavorably compare Trump, then a candidate, to Herbert Hoover, the Republic's last "trade protectionist."

"Trump aspires to be a 21st century Hoover with a modernized 1930 Smoot-Hawley fare platform that has plunged the United States and the global economy into a depression of more than 39, a decade and a collapse of the banking system? "

For better or for worse, we may have an answer to this question in the weeks and months to come.

What does the gold / silver ratio tell us

The gold / silver ratio is another sign of slowing economic growth. This ratio tells you how much ounces of money it takes to buy an ounce of gold. Last week, he crossed the 90 mark for the first time in 26 years, which means the money has not been as undervalued compared to gold since the first year of Bill's first term. Clinton.

The reason is that half of the money demand comes from industrial applications. When demand cools, the price of money drops. One of the main uses of metal is semiconductors, whose sales have declined. According to the Semiconductor Industry Association (SIA), global sales reached $ 32.1 billion in April, a decrease of 14.6% from the same month last year. This is the deepest drop since the financial crisis.

The purchase of money could then be a challenging game, but I also recommend you keep a 10% weight in gold. Although the price of the yellow metal jumped last week, it is not yet fully overbought when you refer to the 14-day relative strength index (RSI). There may be additional upside potential, especially if Trump revisits the Mexican tariff.

For complete information on this post, click here.