Monthly Archives - May 2019

China Gearing Up for All-Out Trade War With United States

If President Trump thought that enacting tariffs on all imports of Chinese goods would bring China back to the negotiating table, he seriously and severely miscalculated. Not only did China retaliate by increasing tariffs on $60 billion worth of imports from the United States, but it also is digging in its heels and refusing to buckle. To hear Chinese state news tell it, the trade war has escalated from a nuisance that would raise prices on consumers to an [...]

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Winning the Lottery Isn’t a Viable Retirement Plan

The past year has seen some really large and nearly record-breaking sums of money won in lotteries. From the $1.5 billion won in Mega Millions in October 2018 to the $768 million won in Powerball in March 2019, many Americans have gotten excited thinking about the things they could do with all that money. Yet despite all that wishful thinking, you would think that most Americans would realize that the odds of winning the lottery are incredibly small, about 1 [...]

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Gold Price Rises on Safe Haven Trading: How Much Further Will It Go?

With President Trump’s revelation that he intends to place tariffs on all imports of Chinese goods, markets went haywire earlier this week. While tariffs on existing imports are rising to 25%, all Chinese imports will soon be subject to punitive tariffs. That will raise the cost of living not just for American consumers but for American businesses as well. With that money essentially being a tax for purchasing Chinese goods, Americans of all stripes will end up spending more [...]

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Printing Money Out of Thin Air Costs You: Here’s How to Defend Yourself

The universal response of central banks around the world to the financial crisis was to create more money. Trillions of dollars worth of new money was created by the Federal Reserve System to respond to the financial crisis, with trillions more created by the European Central Bank, Bank of England, Bank of Japan, and other major world central banks. The result was exactly what central banks wanted: prices for all assets remained elevated. From houses to cars to food and [...]

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Trump Tariff Escalation Risks Igniting Further Trade War

With President Trump’s decision on Friday to raise tariffs on $200 billion of Chinese imports from 10% to 25%, the stakes in the trade war with China just got higher. Trump’s move came while a Chinese delegation was in Washington negotiating a trade agreement, thus scuttling any chances of a successful resolution. China now feels like it has its back up against the wall, and has threatened to retaliate against the tariffs, although just how it will do so [...]

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MMT’s Popularity Means Gold Is More Necessary Than Ever

Along with the Democratic takeover of the House of Representatives has come renewed attention towards a monetary theory beloved by many Democrats and their allies, including Bernie Sanders. That theory, Modern Monetary Theory (MMT) posits that a government cannot ever default on its debt because it can just print money to pay off that debt. Even worse, MMT proponents want the federal government to pay for its purchases by printing new money rather than raising money through tax revenue [...]

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The Many Different Ways to Invest in Gold

By now many investors are aware that stock markets aren’t going to continue rising above their all-time highs. The meteoric rise of the past few years is unsustainable, which is why markets continue to push towards but never break through their previous records. The only way from here is down, with a massive correction on the horizon before markets can recover and make another bull run. Given the underlying weakness of the economy, which will only be exacerbated by continued [...]

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Gold Price Could React to New Inflation Data

With new inflation data coming out this week, the gold price could see a bullish rise if inflation picks up. While official inflation rates always underestimate the actual price increases that most people see, indications of rising inflation could send more investors piling into gold. CPI data from March indicated an 0.4% increase, double the increase that was seen in February. That’s an annualized increase of close to 5%. Year-on-year inflation increased 1.9%, an increase from the 1.5% seen in [...]

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The Ghost of the Past Financial Crisis Has Returned

Everyone who remembers the 2008 financial crisis remembers the role that collateralized debt obligations (CDOs) played in exacerbating the crisis. The way that financial companies packaged together billions of dollars of bad debt, diced and sliced them into securities that they then rated AAA, and sold them to unsuspecting investors seemed to be the epitome of the greed and shady dealing that characterized Wall Street at the time. But while the CDO market declined greatly in the aftermath of [...]

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