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Weekly Digest: Gold Bulls, Crypto Drop, Consumers Hopeless

4 Minuten lesen
18 Nov 2021

18/11/21: The bull case of gold can also be the bull case of bitcoin, U.S. consumer confidence in the dumpster, Yellen extends the U.S. debt default deadline. And more.

Investment news

⭐ The gold price has hit its highest level in five months this week, growing to $1,866 an ounce, as inflation worries lifted its safe-haven appeal. Overall, gold has gained about $100 over the past eight trading sessions, its longest winning streak since May. (Reuters)

“Until the Fed actually signals an accelerated taper, gold should hold its current $1,850 and $1,875 range with the potential appointment of Lael Brainard as the new Fed Chair, who is considered a super dove, likely to push it above $1,875,” said Stephen Innes, managing partner at SPI Asset Management.

Inflation panic? U.S. consumer confidence plunged to a 10-year low in November, reflecting increased concerns among Americans about hotter-than-expected inflation and the rising price of consumer goods. (Fox Business)

The University of Michigan’s consumer sentiment index fell to 66.8 in November – down sharply from the October reading of 71.7 and well below initial forecasts of 72.4.

"Consumer sentiment fell in early November to its lowest level in a decade due to an escalating inflation rate and the growing belief among consumers that no effective policies have yet been developed to reduce the damage from surging inflation," Richard Curtin, the survey’s chief economist, said in a statement.

Meanwhile, UK inflation surges to a 10-year high of 4.2%, and The Bank of England expects inflation to increase further to around 5% in the spring of 2022 before falling back to its 2% target by the end of 2023. (CNBC)

Eurozone inflation hit a new 13-year high of 4.1% in October, as Europe also battles surging energy prices.

Cryptocurrencies fluctuated with Bitcoin dropping most since September below $60,000 and Ether touching its lowest level this month, amid concerns about inflation, U.S. taxation rules, and China’s crackdown swirl. (Bloomberg)

The drop to $58,661 was the biggest intraday slide since Sept. 24. Second-ranked Ether fell more than 10% before also paring losses.

U.S. President Joe Biden is still deciding whether to reappoint Jerome Powell as the Fed chair or replace him with Fed governor Lael Brainard. He said he could make the announcement in the coming days, ruling out other possible contenders, a person familiar with the matter said. (Bloomberg)

Some U.S. senators have expressed concern over the Fed’s handling of inflation, which has hit the highest level in 30 years. Senator Richard Shelby, an Alabama Republican, said he had not decided whether to back Powell, adding: “My concern with the Fed is that they have missed the inflation issue and they could do irreparable damage to our economy.”

Janet Yellen has extended a deadline for a potential U.S. government default to Dec. 15 from Dec. 3, giving Congress more time to raise the federal debt ceiling. (Reuters)

Congress has been locked in a stalemate over increasing the U.S. debt ceiling, with the clock ticking down and a potential debt default. “It is imperative that Congress swiftly addresses the debt limit. If it does not, America would default for the first time in history. The full faith and credit of the United States would be impaired, and our country would likely face a financial crisis and economic recession,” Yellen said.

Opinion

“Bitcoin and gold bulls are soulmates,” says Peter Boockvar, chief investment officer at the Bleakley Advisory Group.

“Keep in mind that the bull case for gold can also be the bull case for bitcoin. I think bitcoin and gold bulls are sort of soulmates, and that they believe in a stable currency, they believe in a sound money, they tend to be more anti-central bank, so there is a lot of commonality in believes of bitcoin and gold,” he told CNBC.

Boockvar said he doesn’t believe that there “has to be one or the other.”

“They can very much complement each other. And with respect to gold - something that’s been around for 5,000 years - it’s not gonna be just replaced like that by something that’s been around for 13 years,” he added.

What else is happening

The historic traffic jam at the Port of Los Angeles has showing signs of easing, making some good news for the supply chain and the nearing holiday shopping season. (Bloomberg)

The number of import containers stationed at the hub have fallen by a quarter since last month, giving the port more space. This has happened because carriers were threatened with fines if they let cargo linger and prevent other ships from unloading.

But there's still a long way to go. Over 80 containers were anchored off the coast of Los Angeles early this week, and the Los Angeles port yard still has some 65,000 empty containers stationed in its docks.

Almost there. Elon Musk is almost halfway to his promise to drop 10% of his stake in Tesla. (Bloomberg)

He's disposed of about $8.8 billion of his shares since he polled his Twitter followers last week on whether he should sell his stake.

And finally…

The 32-year old artist has earned over $1 million in about 9 months by selling 57 nonfungible tokens, or NFTs, of his artwork. (CNBC)

Amrit Pal Singh, who is based in New Delhi, has been selling Toy Faces, the cartoon-like 3-D portraits of different people and characters, including Malala Yousafzai, Steve Jobs and Frida Kahlo.

 

See you next week!

 

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