Thursday Conversation - Alasdair Macleod

39

We kick off our new weekly series with an old friend, Alasdair Macleod of GoldMoney. Be sure to give this a listen.

Ove the course of this discussion, Alasdair and I discuss:

  • the deepening trade war between the US and China
  • the link of a rising dollar with higher US interest rates
  • the long-term impacts if a global bond market selloff
  • the gradual move away from a strictly dollar-reserve system

I think you'll enjoy this new, weekly format. And thanks to Alasdair for his time and support. He was A2A guest #1 back in 2013 so it was a treat to have him be guest #1 for this series, too.

TF

  39 Comments

mike97
Oct 4, 2018 - 3:16pm

1st

Another bad day in Chinese golden week. Why do I suspect that the bullion banks not China are still controlling the prices. NVO and RNX getting hammered. Now to listen to one of the good guys.

RickshawETF
Oct 4, 2018 - 3:53pm

Silver

Silver

AGXIIK
Oct 4, 2018 - 4:22pm

25 BPS might not seem like much

but, as I'm coming in third, this recovering banker is watching the UST 10 yr like a hawk

25 BPS might not seem like much but when pressed against $250 trillion in world wide debt, it makes a much bigger impression than Kav did when he allegedly groped Ford. 25 BPS makes a dent. Right now my clients are asking me when to expect an uptick in their rates. Yesterday, I tell them and more tomorrow. I got Free beer tomorrow too

Bankers gotta eat, yanno

A 3% rate on $250 trillion is $7.5 trillion. Just write that check to any bank of your choice. They're waiting.

For scale purposes, $7.5 trillion is 10% of $75 trillion world GDP

Or a little more than entire worldwide net worth...ex Bush, Rothschild, Rockefellers et al

Another quarter point ain't that much. Right? Just $625 billion.

That's half the increase in $1.4 trillion rise in US national debt. Nothing to see there, right?

I know that not all loans are driven by UST or prime rate. But enough are that a rising rate tide tends to sink a lot of boats

If anyone thinks that 25 BPS is the last rate bump, someone missed Goon Powell's memo. Tres mas in 8 months

That's why I like third place. 3 more hikes. Tres Mas I think I'll have a triple whisky in celebration.

You game Rickshaw? Maybe a Bulleit Bourbon for you? Bottoms up!

Speaking of bottoms up, hold on to your pantaloons, it's gonna get frisky when we hit 4% on the 10 year UST

Blythesshrink
Oct 4, 2018 - 4:33pm

Alasdair was a great choice

Alasdair was a great choice for the first guest.

Wizdum
Oct 4, 2018 - 6:27pm

now, curious..AGX

your clients rates.. interest of savings?

-wiz

streber
Oct 4, 2018 - 7:39pm

Whoa!

$rut

$spx

stockcharts . com

AGXIIK
Oct 4, 2018 - 8:11pm

Wizdum that's interest paid

Mostly small business loans and commercial real estate financing. Banks are quoting uptick of 25 BPS on prime and same for long term commercial paper. I know it disappointing, given borrowers are very used to the last 10 year NIRP ZIRP rate paradigm. Powell wants to normalize rates. How many times have I heard that BS. Betcha he ain't a borrower.

3 more rates and we have a real problem. Derivatives, EM debt, residential, multifamily, commercial, central bank, hedge funds, stock buy backs, petro loans, hard money loans, indirect swaps, overnight paper, all treasuries. The only thing TU on rates are EU Pee you! short term paper at negative rates.

Problem with rate pops, long term paper and bonds, 10 year plus, sees double digit value declines when rates rise. At some point in time the AAA paper sees really hard value erosion. I hear tens of trillions of this paper is tied to derivative bets in the hundreds of trillions. i can't spell quadrillions; it's that scary a problem

That goes toes up and we are going to see some banks fail, that's central banks fail. I cannot even speculate how bad the stock markets get hit but all assets classes are roto screwed for a millennium

Keep stackin' cuz gold and silver might catch a bid

This message was not approved by Martin Armstrong because he posits trillions flowing to safe harbor of US assets will keep the band paid until maybe 2020 and then all bets are called

While walking today I was kind of Rain manning the numbers on world financing, loans, prices of this and that, GDP flat, inflation rise, nature of loans (quality and subprime) reading solid thinkers on all these subject. Having been through 1981 crap fiesta with rates at 20%,1986 flash crash, 1991-3 RE/Bank/sub prime S&L crash, the costs of 2001 tech wreck and 2006-2009 fail, I think we are peaking, with the little engine perched on the top of the 29,000 ft tetons, engine on the down hill, caboose on the uphill side and the Pullmans filled with peeps, straddling the peak, half way between lost and found.

My gut tells me are in the equivalent of the first third of the 2006-7 time period, when all signs were flashing yellow but everyone thought the band had some tunes left on the sheets. We could easily see this fiasco continue for another 12 months before a really big fail. Like Sun Tsu says, I just sit by the river watching the body of my PM and stock portfolio float by. Maybe 6 months left in other scenarios. I dont see levitating until 2020 but I could be wrong and gave been many times

scoremore
Oct 4, 2018 - 8:30pm

RUT roh...

Streber you were right about it dropping from that 50 DMA...

https://www.tradingview.com/x/IjQyd2oO/

Orange line is 50 DMA, Blue is the 200DMA...

Wonder if it will go to the 200 DMA and bounce?

Wizdum
Oct 4, 2018 - 8:47pm

well..

they just keep creating currency
nobody (< 3%) knows what/how dollars happen.
~50% think the US govt just makes them
its just going to get worse

i never asked "what is money?"
until i was 19

...19

that was over 20 yrs. ago
took a long time to get to here

-wiz

Wizdum
Oct 4, 2018 - 8:51pm

$rut

i bought some SRTY yesterday..
..on somebody's advice here

well, they commented n the Russell 2000 rolling over...
so.. I used that
made 5%
sold it today at 2:30

thanks TFMetals !!
-wiz

Key Economic Events Week of 2/24

2/25 9:00 ET Case-Shiller home prices
2/26 10:00 ET New home sales
2/27 8:30 ET Q4 GDP second guess
2/27 8:30 ET Durable Goods
2/27 11:30 ET Goon Evans speech
2/28 8:30 ET Pers Income and Spending
2/28 8:30 ET Core Inflation
2/28 9:45 ET Chicago PMI

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Key Economic Events Week of 2/24

2/25 9:00 ET Case-Shiller home prices
2/26 10:00 ET New home sales
2/27 8:30 ET Q4 GDP second guess
2/27 8:30 ET Durable Goods
2/27 11:30 ET Goon Evans speech
2/28 8:30 ET Pers Income and Spending
2/28 8:30 ET Core Inflation
2/28 9:45 ET Chicago PMI

Key Economic Events Week of 2/17

2/18 8:30 ET Empire St Manu Idx
2/19 8:30 ET Producer Price Idx
2/19 8:30 ET Housing Starts & Bldg Perms
2/19 2:00 ET January FOMC minutes
2/20 8:30 ET Philly Fed
2/21 Fed Goons all day at Chicago Conf.
2/21 9:45 ET Markit flash Feb PMIs

Key Economic Events Week of 2/10

2/11 10:00 ET Job Openings
2/11 10:00 ET CGP Hump-Hawk House
2/12 10:00 ET CGP Hump-Hawk Senate
2/13 8:30 ET CPI
2/14 8:30 ET Retail Sales
2/14 9:15 ET Cap Ute & Ind Prod
2/14 10:00 ET Business Inventories

Key Economic Events Week of 2/3

2/4 10:00 ET Factory Orders
2/5 8:15 ET ADP Employment
2/5 9:45 ET Markit Service PMI
2/5 10:00 ET ISM Service PMI
2/6 8:30 ET Productivity & Unit Labor Costs
2/7 8:30 ET BLSBS
2/7 10:00 ET Wholesale Inventories

Key Economic Events Week of 1/27

1/28 8:30 ET Durable Goods
1/28 10:00 ET Consumer Confidence
1/29 10:00 ET Pending Home Sales
1/29 2:00 pm ET FOMC Fedlines
1/29 2:30 pm ET Powell presser
1/30 8:30 ET Q4 GDP first guess
1/31 8:30 ET Pers Inc and Spending
1/31 9:45 ET Chicago PMI
2/2 10:00 pm ET Chiefs win SB LIV

Key Economic Events Week of 1/13

1/14 8:30 ET CPI
1/14 9:00 ET Goon Williams
1/15 8:30 ET PPI and Empire Fed
1/16 8:30 ET Retail Sales and Philly Fed
1/17 8:30 ET Housing Starts
1/17 9:15 Et Cap Ute and Ind Prod

Key Economic Events Week of 1/6

1/7 8:30 ET US trade deficit
1/7 10:00 ET ISM Services PMI
1/7 10:00 ET Factory Orders
1/8 8:15 ET ADP employment
1/9 8:00 ET Goon Chlamydia speech
1/9 1:20 ET Goon Evans 2:00 ET Goon Bullard
1/10 8:30 ET BLSBS
1/10 10:00 ET Wholesale Inventories

Key Economic Events Week of 12/16

12/16 8:30 ET Empire State Manu Idx
12/16 9:45 ET Markit flash PMIs Dec
12/17 8:30 ET Housing Starts and Bldg Perms
12/17 9:15 ET Cap Ute and Ind Prod
12/19 8:30 ET Philly Fed
12/20 8:30 ET Final guess Q3 GDP
12/20 10:00 ET Pers Inc and Spending
12/20 10:00 ET Core Inflation

Key Economic Events Week of 12/9

12/10 8:30 ET Productivity and Unit Labor Costs
12/11 8:30 ET CPI
12/11 2:00 pm ET FOMC fedlines
12/11 2:30 pm ET CGP presser
12/12 8:30 ET PPI
12/13 8:30 ET Retail Sales
12/13 10:00 ET Business Inventories
12/13 11:00 ET Goon Williams speech

Key Economic Events Week of 12/2

12/2 9:45 ET Markit Manu PMI
12/2 10:00 ET ISM Manu PMI
12/2 10:00 ET Construction Spending
12/4 9:45 ET Markit Services PMI
12/4 10:00 ET ISM Services PMI
12/5 8:30 ET Trade Deficit
12/5 10:00 ET Factory Orders
12/6 8:30 ET BLSBS
12/6 10:00 ET Wholesale Inventories

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