There was more optimism about a trade deal this week. There was also more pessimism about a trade deal this week. Markets reacted accordingly. But there was some other interesting news out there. Jerome Powell lectured Congress about the national debt and last month’s inflation data came in hotter than expected. Host Mike Maharrey covers these stories and more, and basically ignores the trade war gossip, on this episode of the SchiffGold Friday Gold Wrap podcast.
American consumer debt pushed to a new record of $4.15 trillion in September. Part of that equation – the continued surge in the levels of student loan debt.
Student loan balances jumped by $32.9 billion in the third quarter this year, pushing total outstanding student loan debt to a new record of $1.64 trillion. Student loan balances have grown by 5.1% year-on-year.
Over the last decade, student loan debt has grown by 120%. Student loan balances now equal to 7.6% of GDP. That’s up from 5.1% in 2009.
News of a possible “phase 1 trade deal” and movement toward a resolution of the Brexit fiasco have buoyed stocks and put a lid on silver and gold this week. But positive vibes on these two fronts overshadowed a lot of economic data that came out this week that was less than ideal. It seems the American consumer might be getting close to being maxed out. In this episode of the SchiffGold Friday Gold Wrap podcast, host Mike Maharrey digs into a big pile of debt and more.
Gold and silver are down this week. There was some more hopeful trade war news and stronger than expected economic data that drove markets this week. In this episode of the Friday Gold Wrap podcast, host Mike Maharrey covers it, plus some news that’s being mostly ignored. And he ponders a question: should we be looking at the economic glass as half-empty or half-full — and why?
Americans continue to drive the economy along spending money they don’t have. Consumer debt increased yet again in July, setting another record, according to the latest data released by the Federal Reserve.
Total consumer debt surged $23.4 billion in July, driven by a huge jump in credit card balances. The big rise in consumer indebtedness took analysts by surprise. Bloomberg said the increase “exceeded all estimates” in a survey of economists. Overall, consumer debt increased by an annual rate of 6.8% after a 4% increase the previous month.
The price of gold whipsawed this week, driven up and down by various headlines. In this episode of the Friday Gold Wrap, host Mike Maharrey covers some of the big news that moved the markets. But he said that we need to keep our eyes on the big picture. All of this is happening in front of a backdrop of surging debt driven by central bank policy. How much do we owe and what does it mean for the future? Mike talks about it.
The bond market flashed a major recession warning sign as the yield curve inverted this week. Meanwhile, Trump whipsawed markets when he appeared to blink in the never-ending trade war with China. That made for an interesting week for gold. In this week’s Friday Gold Wrap podcast, host Mike Maharrey breaks down the events of the last few days and their impact on precious metals. He also remembers an important day in history that went mostly unnoticed in the mainstream.
Consumer debt is driving American economic growth.
Total outstanding consumer debt surged over $4.1 trillion in the second quarter of 2019, according to the latest data released by the Federal Reserve.
American indebtedness grew by 4.9 over the year, and the quarterly gain from Q1 to Q2 came in at $60 billion — the biggest second-quarter increase since Q2 2016. Over the last 12 months, American consumers have piled on an additional $208 billion of debt.
As gold has rallied over the last few months, silver has lagged behind. The silver-gold ratio spread to near-record levels. This tells us that silver is extremely undervalued compared to gold. But last Tuesday, that spread began to narrow ever-so-slightly and silver crossed a key price level on Thursday. Could this be the beginning of the breakout in silver we’ve been expecting? On this episode of the Friday Gold Wrap podcast, host Mike Maharrey breaks down what’s going on in the silver market along with the big leg-up in gold this week. He also highlights the ever-growing levels of consumer debt and tells you the latest on China’s move to dump US bonds.
Americans are buying stuff. Retail sales were stronger than expected in June. Auto sales increased by 0.7% after a similar rise in May, helping boost total retail spending. Overall, retail sales were up 0.4% last month. The Commerce Department revised May sales down from 0.5% to 0.4%.
Increasing retail sales would seem to be a good sign for the economy, but the latest consumer credit numbers reveal an underlying problem. Americans are buying a lot of this stuff on credit. How long can consumers keep running up credit cards before the bubble bursts?