By David Treece
Getting used to the illogical is becoming the norm, so get ready to buy a safe. In Japan interest rates were cut to below zero, which according to Bloomberg News has caused many Japanese people to buy safes for their homes. The article stated that in the new upside-down world borrowers get rewarded and savers penalized.
We stated last week that banks were set to announce their worst earnings since before the Great Recession, and true to reports Goldman Sachs reported terrible earnings in the first quarter. But like all the major media outlets they continue to "peddle fiction" by stating that this is a short-term issue and America is in an economic recovery. If this is truly the case, why has the Federal Reserve remained in emergency measure mode? If they were not in emergency mode, interest rates would have continued to increase, but Fed Chair Janet Yellen has yet to continue her stated objective to increase interest rates in 2016.
The Financial Times reported that central banks in Japan and Europe are feeling the impact of negative interest rates, because the return that they were making on their reserves has been dried up. If interest rates go negative, parking money at banks costs the saver. And when it happens in America, please know that it's a last-ditch effort to stimulate a sinking economy.
According to Bloomberg News, Deutsche Bank has settled a lawsuit in which they admit that they have manipulated the price of silver and gold. When this is revealed, it is easy to understand why China wanted to establish their own pricing structure for precious metals. Much misinformation surrounds the physical precious metals market, and a common refrain that gets parroted is that "gold is volatile." We investigated this claim and found it to be fictional. We added a page to our website that proves that gold has been extremely stable over the last thirty years and in fact it has experienced a 66.3% increase in price in the last thirty years. Again, those who say gold is volatile need to do their homework. Click here to go to our new webpage.
You may be saying this is all great, "But the unemployment numbers are down to 5%. Surely that means the economy is recovering." Just like the price of gold and stock market trading, the employment numbers are fudged to lead you to believe something that just isn't the truth. The funny thing is that the government is like a kid with its hand in the cookie jar. It lets you see the chocolate on its mouth. The government's own Bureau of Labor Statistics shows that only 63% of able-bodied American workers are working. That means 37% of people who could work are not working. What does that say about the economy? It tells me that there is an underclass existing that most working Americans have no awareness of.
These facts are not written to scare you, but to explain to you why your house needs to be in order. We do not have a crystal ball, and our timing is not God's timing. However, when presented with these facts the least you can do is to prepare financially.