October 2018 - Goldco

Monthly Archives - October 2018

Saudi Arabia and the petrodollar

The Saudi Crisis Is a Major Factor That Could Blow Up Markets

Unless you’ve been living under a rock for the past three weeks, you’ve undoubtedly heard of the furor surrounding Saudi Arabia’s alleged torture and murder of dissident journalist Jamal Khashoggi at the Saudi consulate in Istanbul. The reaction from the West has been strong and steady, with numerous luminaries pulling out of a major investment conference that had been scheduled in Saudi Arabia. But while there have been threats of “punishment” in the event that Saudi Arabia is found [...]

Stock markets are due for a correction

Big Stock Gains Won’t Protect You Against the Coming Crash

Eight months after the stock market turbulence that rocked markets in February, the markets are at it again. Near-record drops, severe slides, and big bouncing recoveries are back again. But while many mainstream financial analysts continue to urge investors to buy the dip, arguing that stock markets are still a great investment, those who remember the events of 2007-2009 and the suffering that stock market investors had to endure would argue otherwise. Markets are still near all-time highs and [...]

The Fed's loose monetary policy is to blame for a weak economy and crashing stock markets

The Fed Is to Blame for Crashing Stock Markets, But Not for the Reasons That President Trump Thinks

President Trump last week placed the blame for crashing stock markets on the Federal Reserve and its decision to continue raising interest rates. The President thinks that’s crazy and wants the Fed to keep interest rates low to keep the economy humming along. And while Trump stated that he doesn’t want to fire Fed Chairman Jerome Powell, the public pressure on Powell from Trump will undoubtedly grow stronger in the coming weeks and months, particularly when stock markets continue [...]

Crashing stock markets are trying to send a message

Markets Are Sending a Message – Are You Listening?

If weakness in the stock market earlier this year didn’t wake up investors and make them realize the underlying weak fundamentals of the US economy, hopefully last week’s stock market declines did. Just as much of the stock market’s growth over the past few years has been driven by tech stocks, so has much of the decline been driven by those stocks too. And with tariffs starting to affect international trade and drive up prices for consumers, economic growth [...]

How best to save for retirement

What’s Keeping Most People From Saving for Retirement?

The dream of every American is to retire comfortably and securely. After decades of working in an office, at a factory, or in a school or hospital, people want to be able to relax and enjoy their golden years in retirement, seeing the sights and having the experiences that they didn’t have time for while they were working. But for more and more Americans that dream is moving further and further away from reality. Why is that occurring, and [...]

A stock market crash is around the corner

All Signs Are Pointing Towards a Crash – Are You Prepared?

Those of us who criticize the Federal Reserve’s conduct of monetary policy are often ignored and sidelined during boom times. We’re supposedly the ones who are crashing the party, harshing the market’s vibes, always predicting doom and gloom. Well, there’s a reason for that, and that’s because the Fed’s inflationary monetary policy will always end in a recession or depression. A boom that is artificially induced through creation of new money and credit will always end in a bust, [...]

Trade relations with China are worsening

Continuing Deterioration of Relations With China Could Worsen the Coming Financial Crisis

For anyone hoping for a restoration of normal trade relations between China and the United States, last week’s Bloomberg report on Chinese government hardware hacking came as a devastating blow. If the allegations are true that Chinese spies managed covertly and surreptitiously to place microchips into servers used by Amazon, Apple, and other large American corporations, that will just provide more ammunition for the Trump administration to maintain its current position towards China or even to enact more tariffs [...]

Dig behind the numbers to assess asset performance

Dig Behind the Numbers to Find the Best Investments

While most investors know that past performance is no predictor of future performance, they nonetheless look at past performance as a potential indicator of the future. Particularly when you’re looking at mutual funds or index funds, judging fund managers on their ability to pick the right assets for a fund can be a very important part of doing your homework. But if you’re relying just on the numbers provided in fund prospectuses you could find yourself missing out on [...]

The Fed's accommodative monetary policy isn't over

Has the Fed Really Ended Its Accommodative Monetary Policy?

The Federal Open Market Committee (FOMC) voted last week to raise interest rates yet again, setting a target range this time of 2.00-2.25%. While that was expected by everyone and had been priced in already by markets, what took some people by surprise was the fact that the FOMC’s statement for the first time in years omitted the statement that the “stance of monetary policy remains accommodative.” That had many observers claiming that this latest interest rate bump marked [...]

Insider stock selling

Insider Stock Selling Increasing as Buybacks Reach Record Highs

According to the latest estimates, stock buybacks will have reached an all-time high of $1 trillion this year. That’s a 46% increase from last year, and far higher than the previous high reached in, you guessed it, 2007. And that estimate could even be conservative, given that we’re still only three quarters into the year and stock prices have in recent weeks climbed back to record highs. Those high stock prices have spurred corporate insiders to dramatically increase their rates [...]