The “resilient” American consumer seems to be running out of gas.
Americans are still running up credit card debt but at a much slower pace. Meanwhile, borrowing for big-ticket items has cratered.
Total consumer debt rose by $5.2 billion in October, according to the latest data from the Federal Reserve. That was a relatively small 1.2% increase.
According to the latest non-farm payroll report from the Bureau of Labor Statistics (BLS) the US economy added 199,000 new jobs in November and the unemployment rate dropped to 3.7%. This was widely viewed as a “strong” jobs report. According to one mainstream analyst, the November employment data “portrays an economy that is easing toward a soft landing and is not on the brink of a recession.”
Peter Schiff wasn’t as impressed. He called it “just another hyped-up jobs report.”
It’s not a good idea to argue about things you don’t know anything about. Most people realize this — until it comes to economics. A lot of people argue economics from a position of ignorance. President Biden is one of those people. In this episode of the Friday Gold Wrap, host Mike Maharrey dissects a couple of comments Biden made last week and teaches some economics along the way. He also talks about the significance of gold’s record-breaking week.
Gold surged to a new record high of $2135 early Sunday morning before pulling back sharply Monday. In this video, Peter Schiff explains why this is a buying opportunity.
After setting the record, gold quickly sold off and consolidated, dropping over $100 back to around $2,020. Some people see the quick selloff as a bearish sign. Peter said he doesn’t think so.
Gold set a new record on Friday and broke it again over the weekend. The spot price went as high as $2,125 in overseas trading Sunday night. In his podcast, Peter Schiff explained why he thinks this bull run is just getting started and gold will go much higher.
In fact, Peter said he thought these records would be broken “many many times over.”
Imagine a bedroom. It looks clean and safe, but there is a monster under the bed that nobody notices. As host Mike Maharrey explains in this episode of the Friday Gold Wrap, that’s basically the condition of the US banking system right now. It appears “sound,” but a closer look reveals a financial crisis is still bubbling under the surface. He also talks about the recent run-up in the price of gold.
No one is talking about the US trade deficit in the current fiscal year, but it is likely to be another record, bringing with it new rounds of trade sanctions and protectionism.
In this article, I explain why the twin deficit hypothesis will apply, bearing in mind a likely budget deficit outturn of $3 trillion and a negative savings rate.
October CPI coming in cooler than expected ramped up expectations that the Federal Reserve is at the end of its inflation fight. In fact, many analysts now expect the Fed to begin cutting interest rates in 2024.
Looking at the bigger picture, inflation’s apparent retreat boosted mainstream belief that the economy will glide to a “soft landing.” With a lot of economic data weakening, the markets anticipate that the Fed will proactively cut rates to preempt a recession and prevent a crash landing. The thinking is as soon as it sees the economy coming in for a landing, it’s going to cut rates to ensure that landing is soft.
Holiday shoppers plan on cutting back on spending and piling on even more debt this year, and nearly a quarter of Americans still haven’t paid off their debt from last year’s holiday spending spree.
These were just a few revelations in a recent WalletHub survey that indicates American consumers aren’t quite as “resilient” as pundits and government people would have you believe.
Deutsche Bank economists say the Federal Reserve will create more inflation in 2024.
OK, that’s not exactly what they said. But that is the implication of their latest forecast.
