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July Gold News 2016


Global debt out of control

Global debt out of control

Since the 2008 economic crisis global debt levels have exploded. America’s debt to GDP ratio stands at 103%, Japan 240% and Italy 170%. When you take into account unfunded liabilities such as government pensions, the figures are many times worse. In reality there is no chance these debts will ever be repaid. Politicians tell us we are in an era of austerity, yet deficits keep rising. The political class hope we will grow our way out of the problem, but growth is yet to materialise

Since 2008 $60 trillion of debt has been added pushing the worldwide debt load to ...

The warning lights are flashing once again

The warning lights are flashing once again

Earlier this week the IMF and European commission both lowered their growth forecasts for the UK economy. The decision to exit the European Union has “thrown a spanner in the works” of the global economy according to the IMF. They now believe the British economy will grow by an anemic 1.3% in 2017.  

As the economy grinds to a halt this forecast looks optimistic. It now appears more likely we are heading into another recession. Despite leaving rates unchanged in July the Bank of England is widely expected to slash rates when the Open Market Committee meets next ...

 If there was any doubt working families are the ‘new poor’

If there was any doubt working families are the ‘new poor’

The success of a country can be measured by the size and productivity of its middle class. In Britain today, middle income working families are being labelled the “new poor” by the UK’s leading think tank the Institute for Fiscal Studies.

Two out of every three children living in poverty have at least one parent working. The gap between Britain’s poorest households and those on middle income is at its lowest level for 20 years.

The young are suffering the most, with incomes for the under 25’s still languishing at pre-2008 levels. Whilst the over 60’s have experienced a 11% ...

Gold slips as Turkish coup fails

Gold slips as Turkish coup fails

The gold price retreated during Asian trading as safe haven demand for the yellow metal waned after a failed Turkish military coup.

The U.S. dollar has been the main benefactor as investors reversed safe haven trades with calm beginning to return to Istanbul and Ankara.  In retaliation, President Erdogan ordered the arrest of 6,000 people he believes organised the coup against his government. The gold price fell 2% last week, its first weekly decline in seven weeks.

In other news, better than expected U.S. retail sales clearly got traders to start contemplating the Fed may actually raise interest rates this year. ...

Gold rally just starting according to UBS & Credit Suisse

Gold rally just starting according to UBS & Credit Suisse

Following three difficult years for the yellow metal the first six months of 2016 have seen gold surge 28%, its best first half return since 1974.

According to analysts from Credit Suisse and UBS the rally has only just begun. In the short term analysts from both banks are expecting the price to reach $1,400 per ounce. The surge is being spurred on by economic uncertainty, loose monetary policy and anaemic yields on government and corporate paper.

Following the UK’s decision to exit the EU institutional money has flooded into government debt, pushing yields to all-time lows. For the first time in ...

The next financial crisis could start with Italian Banks

The next financial crisis could start with Italian Banks

Concerns over the health of the Italian banking sector is starting to spook the financial markets. Figures suggest 17% of all loans issued by Italian banks have gone bad, which is equivalent to £300bn.

Market volatility following Brexit has hit the sector hard. A perfect storm of low growth, political instability, corruption and low interest rates is undermining the banking sector.

The political elite in Brussels are opposed to an EU bailout, instead they prefer shareholders and junior bondholders to take a haircut. This will not be politically acceptable in as most of the junior bonds have been sold to ...

Deutsche Bank calls for 150 Billion euro Bank bailout

Deutsche Bank calls for 150 Billion euro Bank bailout

The European banking system needs a €150 billion bailout according to Deutsche Bank's chief economist, David Folkerts-Landau.

According to Folkerts-Landau, Europe is extremely sick and must deal with its structural problems now or there is going to be a financial accident.

In the aftermath of Brexit Italian banks have come under considerable pressure and are reported to need a €360 billion bailout. So far Italian cries have fallen on deaf ears, as German politicians dismiss a taxpayer bailout.

Ironically the crisis has ...

The world’s most dangerous bank

The world’s most dangerous bank

Deutsche Bank is Europe’s largest bank and according to the International Monetary Fund (IMF) the world’s most dangerous bank. If Deutsche Bank fails it has the potential to collapse the global financial system. So should we be worried?

Deutsche Bank’s share price has collapsed by over 50% in the last 12 months and now trades at 30 year lows. In simplest terms you can value a banks worth by measuring the difference between the bank’s assets and its liabilities.  This currently stands at 60bn euros which is not a lot when you consider the sheer size of Deutsche Bank loan ...

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