Exploring Finance

The BLS provides an employment picture of the US on the first Friday of every month. It estimates how many jobs were added or subtracted by sector. While some of the assumptions may be controversial (e.g. the birth/death model) and job numbers are prone to revisions, it remains the most widely anticipated statistic each month by […]

“Just because something is inevitable, does not make it imminent, but eventually the future arrives” The US Government is on an unsustainable debt trajectory. Even though the Federal Reserve has acknowledged this fact, most mainstream pundits consider it a distant problem or even not an issue at all. They argue that debt fears have raged […]

The US Trade Balance shows the deficit and surplus of US trade for Imports and Exports. A deficit occurs when imports are greater than exports. When the Trade Balance is in deficit (which it has been for decades), it accounts for one of the two components of the Twin Deficits. The Fiscal Deficit accounts for […]

The CFTC Commitment of Traders (COTs) report is released once a week and shows a breakdown of open interest by trader category. As discussed in the gold/silver pricing analysis, Open Interest can be a major factor in the metal price. The CFTC breaks down open interest by:

This analysis focuses on gold and silver data provided by the Comex/CME Group. The Comex (or CME Group) is a global derivatives market that allows for trading in futures contracts. They allow two parties (a long and a short) to speculate or hedge in specific commodity markets and guarantee the transaction in the process. The majority […]

The Federal Reserve has three primary tools to conduct Monetary Policy: reserve requirements, the discount rate, and open market operations (Quantitative Easing). Open market operations are how the Fed uses its balance sheet to provide liquidity to the market. More details can be found here. The Fed defines Open Market Operations as:

M2 Money Supply is measured by the Federal Reserve to calculate the amount of Money in the financial system. The Fed defines M2 as: Seasonally adjusted M2 is constructed by summing savings deposits (before May 2020), small-denomination time deposits, and retail MMFs, each seasonally adjusted separately, and adding this result to seasonally adjusted M1. Historically, […]

This analysis focuses on gold and silver data provided by the Comex/CME Group. See the article What is the Comex for more detail. Silver: Recent Delivery Month First Position Day is when contracts must post 100% margin to stand for delivery. Once delivery begins, contracts can settle in cash, or more contracts can be opened […]

The US Budget Analysis shows the deficit or surplus of the US Federal Government. A deficit occurs when spending (outlays) is greater than income (receipts). When the US Budget is in deficit (which it has been for over 2 decades), it accounts for one of the two components of the Twin Deficits. The trade deficit […]

Many variables can drive the price of gold and silver. These include Fed meetings/speeches, inflation data, jobs numbers, risk appetite, etc. Some people speculate that the price is suppressed and manipulated by the banks and Fed. While coordinated suppression is not impossible, there are other more probable explanations for gold and silver price action. This […]