There is little doubt that the United States Of America is in an inescapable debt trap. While I am not suggestion any gloom and doom scenario in the foreseeable future, the US dollar is likely to trend lower and the government is likely to try and inflate its way out of the debt trap. Unfortuantely, that has never worked in…
In several articles that I have written in the recent past, I have maintained my bullish view on gold for different reasons. Gold price trend as compared to real interest rates is yet another indicator of bullish times for gold in the coming years. The real interest rate here is the 5-Year Treasury Inflation-Indexed Security. The chart below plots gold…
In simple terms, money velocity is the number of times one dollar is spent to buy goods and services per unit of time. Therefore, if the money velocity is increasing, more transactions are occurring between individuals in an economy and vice versa. Considering the purpose it serves, money velocity is a good indicator of real economic activity. The key reason…
Continued weak recovery in major industrial economies and softer growth prospects for the People’s Republic of China combine to slow growth across much of developing Asia.     This article was first published by the Asian Development Bank (www.adb.org)
Analysis Overview – In the period 1980 to 2015, the dollar has lost 65% of its value with $1 of 1980 worth just $0.35 cents in 2015. One of the key functions of money is that it’s a store of value, but I am of the view that the dollar will never be a store of value again. The chart…
On March 31, 2016, the World Gold Council published a market update - Gold in a world of negative interest rates. The update provides some excellent information on how a significant portion of government bonds are trading with negative yields and presents a case for increasing investments in gold. The chart below that is sourced from the same report puts…
China’s manufacturing and non-manufacturing PMI data for January and February 2016 indicated freefall in economic activity and global financial markets were under stress at the beginning of the year. However, PMI data for March 2016 serves as a breather for policymakers and investors globally. While several concerns sustain for China’s economy (swelling debt and potential banking sector crisis), the latest…
  Growth is slowing across much of developing Asia as a result of the continued weak recovery in major industrial economies and softer growth prospects for the People’s Republic of China (PRC). This will combine to push growth in developing Asia for 2015 and 2016 below previous projections, says a new Asian Development Bank (ADB) report. In its new Asian…
Friday, 01 April 2016 00:00

Is Economic Growth in Its Final Innings?

  Guest Article From Frank Holmes Of U.S. Global Investors   The start of baseball season is still several days away, but a recent survey conducted by Bank of America Merrill Lynch found that 59 percent of U.S. fund managers believe the current stretch of economic growth is in its “final innings.” This is the highest reading since the financial…
Thursday, 31 March 2016 00:00

Expect The Fed To Cut Rates In 2016

Analysis Overview – The Fed is likely to cut interest rates in 2016 and this article discusses the factors for this view and the investment strategy in the current scenario. The Big Slump – When the fed increased rates in December 2015, there were economists talking about at least four rate increases in 2016. However, global economic activity has weakened…