Americans owe over $1 trillion in credit card debt and recent polling data indicates they aren’t paying off those balances anytime soon.
According to a CNBC article, nearly half of all Americans carry a balance on their credit cards. Of those, only 30% say they will be able to pay off that balance within the next year.
Is the world really running out of gold?
According to a report in Deutsche Welle, it just might be.
Historically, a Federal Reserve shift from interest rate tightening to a neutral stance has boosted the price of gold, although the effect has not always been immediate, according to a report released by the World Gold Council this week.
It wasn’t long ago that the Fed was talking about multiple rate hikes in 2019 and balance sheet reduction was on “autopilot.” But all of that changed when the stock market started tanking last December. Now we have the “Powell Pause,” and an apparent end to balance sheet reduction on the horizon.
Not too long ago, Peter Schiff said, “The rate hikes of the past have already guaranteed that the economy is headed for recession. It doesn’t matter whether they continue to raise rates in the future. The recession is a done deal.”
In a recent interview, economist and editor of the Gloom, Boom and Doom Report, Dr. Marc Faber, expressed a similar sentiment, saying, “Forget about the coming slowdown because the economy has already been backing up for months and we’re likely already in a recession.”
As we reported last week, consumer debt continues to break records month after month. Americans owe over $4.3 trillion dollars in revolving debt (primarily credit cards), student loans and auto loans. When you factor in mortgages, the number climbs to $13.54 trillion. That figure was $869 billion higher than the previous peak of $12.68 trillion in the third quarter of 2008 (right before the crash) and 21.4% above the post-financial-crisis trough reached in the second quarter of 2013.
But many mainstream analysts downplay this surge in debt. And on the surface, the numbers do seem to indicate the risk isn’t as big as it was prior to the 2008 financial crisis. But as Wolf Richter explains, the averages conceal a different reality.
Jim Grant recently appeared on the Santelli Exchange on CNBC and the conversation quickly turned to this notion that “intellectuals” have the wherewithal to run the economy. Friday Gold Wrap host Mike Maharrey recently explained two very important economic principles that make it impossible for central planners to ever truly succeed. As he put it, they might be smart, but they aren’t smart enough to know they’re not smart enough. Nevertheless, this doesn’t seem to dampen the fatal conceit and hubris of central bankers who think they can micromanage a complex economy.
Grant put it another way. He called it the ignorance that knows not it’s ignorant.
Well, if you’re any kind of news junkie, you probably know that the Senate voted this week to reject President Trump’s national emergency declaration. But fear ye not – there are plenty of other national emergencies on the table!
Federal Reserve Chairman Jerome Powell appeared on 60 Minutes last Sunday to reassure us that the US economy is great. There’s nothing to worry about. So, why the sudden reversal in Fed monetary policy? According to Powell, the central bank is just worried about slowing global growth. But as Mike Maharrey discusses in this week’s Friday Gold Wrap, it’s pretty clear the real problems are right here in the good ol’ US of A. Mike also covers the latest in precious metals news, with a focus on silver.
What is the biggest problem in the US economy? As Peter Schiff put it in a recent podcast, “The big, fat, ugly bubble is deflating and the air is coming out.”
And that is precisely why Peter thinks Jerome Powell recently appeared on 60 Minutes.
This is part of a confidence road show – a dog and pony show.”
