The last article highlighted the strange things going on in the gold market. Specifically:
- Cash settlement instead of delivery for February
- Increased open interest in March
- Slightly higher spread cost in April.
Recent weeks have seen several flashing yellow signs in the gold market.
The Federal Reserve released the minutes from its January FOMC meeting on Wednesday (Feb. 16). While there was some talk about taking on inflation, it doesn’t appear the central bank is really serious about an inflation fight. In his podcast, Peter Schiff talked about the most recent inflation data and the Fed’s response. He said the central bank is quickly running out of minutes.
Gold continues to flow out of COMEX vaults at a rapid pace. Inventory fell 3% in the last month alone.
This analysis focuses on gold and silver within the Comex/CME futures exchange. See the article What is the Comex? for more detail.
St. Louis Federal Reserve President James Bullard unwittingly let the cat out of the bag and revealed the central bank doesn’t have the stomach to do what’s necessary to take on surging, persistent inflation.
Federal Reserve Chairman Jerome Powell “retired” the word “transitory” as it relates to inflation back on Nov. 30. Just two-and-a-half months later, we’re seeing a new word bandied about to describe inflation — persistent.
Less than a week after the January CPI data came in even hotter than anticipated (again), we got yet another signal that persistent is a much better word for the inflation situation. Producer prices (PPI) doubled expectations, charting the biggest increase in eight months.
Another hotter than expected CPI print in January put even more pressure on the Federal Reserve to do something about inflation. Suddenly, there is talk of a 50 basis point interest rate hike at the next FOMC meeting.
But “doing something” is is easier said than done, particularly in this zombie economy.
SchiffGold managing editor and host of the Friday Gold Wrap podcast Mike Maharrey joined Mises Institute President Jeff Deist on WHBO radio to talk about inflation and the Federal Reserve, Mike explains how the Fed has gotten itself stuck in a tight spot. To be sure, it has an inflation problem. But a legitimate fix would create its own set of problems.
In a nutshell, the central bank is damned if it does and damned if it doesn’t.
Chinese gold consumption boomed during the January holiday season. This continued the 2021 trend where Chinese gold demand climbed back above prepandemic levels.
After CPI came in hotter than expected yet again in January, Peter Schiff appeared on Fox Business along with Chief Investment Officer and Portfolio Manager of Solutions Funds Group Larry Shover. Peter said that the inflation tsunami is just getting started and the Fed is powerless to fight it.
The US Treasury realized a monthly surplus of $118.7 billion in January. It was the first budget surplus since September 2019 and the largest since it realized a $160 billion surplus in April of 2019.
The surplus was driven by high revenue from a continued surge in Individual Taxes. This was combined with shrinking expenditures due to the expiration of the child tax credits that ended on December 31. The surplus for the month also was helped by $70 billion in proceeds from a wireless spectrum auction.
