The macro has moved through a time of moderately rising inflationary concerns when economies were cycling up, many commodities were firm and risk was ‘on’. Contrary to the views of inflation-oriented gold bugs, that was not the time to buy gold stocks.
As I have belabored again and again, the right time is when the inflation view is on the outs, gold is rising vs. stock markets, the economy is in question, risks of a steepening yield curve take center stage (the flattening is so mature now that steepening will be a clear and present risk moving forward) and by extension of all of those conditions, confidence declines.
In short, the improving sector and macro fundamentals I’ve been writing about for a few months now continue to slam home as the cyclical world pivots counter-cyclical. And what do you know? Gold stocks are reacting as they should. Well, it’s about time, guys!
The technicals had already made some constructive moves as noted in an NFTRH subscriber update on December 4th. The update concluded as follows… Continue reading "Gold Stocks Acting As They Should"
“The Harbinger of Doom”? Of course, we (well, the media) are talking about the yield curve AKA Amigo #3 of our 3 happy-go-lucky riders of the macro. I have annoyed you repeatedly with this imagery in order to show that three important macro factors needed to finish riding before a situation turns decidedly negative.
Amigo 1: SPX (or stocks in general)/Gold Ratio
Amigo 2: 30 Year Treasury Yield
Amigo 3: Yield Curve
In honor of Amigo 3’s arrival to prime time let’s have a good old fashioned Amigos update (going in reverse order) and see if we can annoy a few more people along the way.
Clicking the headline yields a Bloomberg article all about various yield curves and all the doomed news you can use, including a hyperactive interview with an expert bringing us all up to speed on the situation. Continue reading ""Harbinger Of Doom": Amigo 3 In Play, But Real Doom Awaits"
There is a lot of talk now about a flattening of the yield curve. This talk has been among the most intense right here at the website you are reading at this moment. A flattening curve is commonly viewed as bad for gold, and according to Mark Hulbert, is an indicator of a coming recession.
But is the curve really flattening or is this all hype based on Janet Yellen's press conference comments? Here is a chart the likes of which we have been using in NFTRH for many months now, the 30 year vs. the 5 year yield.
Here we should lend some perspective. Okay Beuller, I ask you what is different this time from the last flattening? Continue reading "Is The Yield Curve Really Flattening?"