The federal government continues to spend money at an insane rate and is running up budget deficits reminiscent of the Great Recession era.
With one month left to go, the federal budget deficit for fiscal year 2019 eclipsed $1 trillion in August, according to Treasury Department data released last Thursday.
Corporations are piling on the debt.
Last week, companies borrowed $74 billion in the US investment-grade bond market. It was the largest corporate debt increase for any comparable period since they started tracking such things in 1972.
As Bloomberg put it, Russia’s bet on gold looks better every month.
The Russian Central Bank’s gold reserves have topped $100 billion thanks to continued buying and surging prices.
The silver market in India has enjoyed massive growth over the last several years. Demand for the white metal has increased from around 3,000 to 6,000
tons over the last five years, according to Chirag Thakkar, CEO of the Indian bullion company Amrapali Gujarat.
The Silver Institute interviewed Thakkar for the latest edition of Silver News.
China added another 5.91 tons of gold to its reserves in August, bringing its total official gold purchases on the year to almost 100 tons, according to data released by the People’s Bank of China over the weekend.
It was the ninth straight month of gold purchases for China as it continues efforts to diversify reserves away from the US dollar.
During a CNBC interview, former Federal Reserve Chairman Alan Greenspan said gold prices are surging because investors are looking for hard assets that they know will have value in 20 or 30 years.
Gold-backed ETFs added another 122 tons of gold globally in August and total holdings are nearing all-time highs.
Total ETF gold holdings have reached 2, 733 tons. That’s just 52 tons away from the all-time high reached in 2012 when the price of gold was 9% higher, according to the most recent data released by the World Gold Council.
Central banks continue to gobble up gold. Globally, the world’s central banks added another net 13.9 tons of gold to their reserves in July.
While this was the lowest net increase in global central bank reserves since August 2017, the number was skewed downward by a significant gold sell-off by Uzbekistan. Gross purchases by the world’s central banks came in at 36.4 tons, according to the latest data released by the World Gold Council.
Has QE4 already started?
For the first time since October 2014, the Federal Reserve has bought a significant number of US Treasurys. Over the past two weeks, the Fed purchased $14 billion in US bonds.
During a recent interview on RT America, Peter Schiff said investors should stay away from the dollar, not only because of the looming recession, but because its days as a reserve currency could be numbered.
Is this just hyperbole, or could the US dollar really fall off its throne? America’s enemies would certainly like to see it happen. And increasingly, so would its friends.
