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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

Mike · Oct 4, 2018 - 3:16pm

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

Craig Francis · Oct 4, 2018 - 4:22pm

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 for the first guest. yes

Wizdum · Oct 4, 2018 - 6:27pm

your clients rates.. interest of savings?

-wiz

streber · Oct 4, 2018 - 7:39pm

$rut

$spx

stockcharts . com

Craig Francis · Oct 4, 2018 - 8:11pm

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

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

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

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

Ozymandias · Oct 4, 2018 - 9:02pm

on the street where I live. Many of the houses in my neighborhood have been being upgraded and placed on the market. It is a fifty year old pleasant, stable neighborhood where most of the long term residents are either dying or moving into retirement homes, etc. On my block there are currently three homes that have undergone such an upgrade and are on the market at what seems to me to be very high prices. One has now been leased out because the owner could not find a buyer. This house has had two sales contracts on it in the past six months which did not go through for reasons I don't know. The other two houses now have "For Sale or Lease" signs instead of "For Sale" signs. It seems to me that it is going to get worse rather than better. I don't know what kind of interim or short financing they have on these properties but I suspect they might be hurting. The rising rates have to be making a bad situation worse for them.

I'm just going to Keep Stacking and GO ASTROS!!

canary · Oct 4, 2018 - 9:24pm

The US economy is going like a train. The European economy is going like a train, Japan seems to be doing well, and China has something going.....

Isn't that what the Central Bankers have been telling us for quite sometime?

Btw...I respect Alasdair a lot.

canary · Oct 4, 2018 - 9:37pm

From ZH: A quick side note on the ISM non-mfg survey: as we discussed earlier, if payrolls follow the employment component, tomorrow's jobs number should print in the 500,000 range, the highest since 1983. If that happens, look for 10Y yields to shoot into low earth orbit. smiley

Bill · Oct 4, 2018 - 11:03pm



lakedweller2 · Oct 4, 2018 - 11:21pm

They want their guy confirmed no matter what it costs. 

Jim xxxx · Oct 4, 2018 - 11:44pm

think things are going to improve in Washington DC, if we believe that an earthly man can cover our sins, if we hope the schools will return to the 3 R's, if we believe the stock brokers look out for our interests, if we take the chemo/radiation for our sickness, if we believe the radical left will wake up and consider the citizens, if we hope for the removal of snowflakes from our high schools and colleges, if we trust the SCOTUS to make decisions for the good of the nation, if we look for Hollywood and Disney to offer wholesome films for the family, without the demonic and perverts, if we look for the inner cities to lay down their weapons and love their neighbors, if we believe the millions of homeless will seek employment and learn to throw trash into garbage cans, if we hope that the drug companies will only sell safe drugs, if we believe that the perverted parades will disband, if we believe that Jesse and Al will wake up and help the black community without compensation, if we believe that Damascus will become a city of peace and be rebuilt, if we believe that Israel will settle its conflicts with a peace treaty, and if we believe that gold/silver and bitcoin will blast to the moon and soon, then we have become dreamers and better make sure our homes and lives are not visited by a thief of all mankind. jmo Jim

onesong · Oct 4, 2018 - 11:47pm

hyper linking or whatever that's called... how'd you do that?

Now if true... does G/S go down tomorrow to the earth's core or to China come Monday?

I've spent four lonely days in a brown LA haze

And I just want you back by my side.

Edit: Couldn't help myself.

L G · Oct 5, 2018 - 1:28am

"Today's Market Comments:

Big down day Thursday, October 4th. Stocks may have topped on our most recent Phi mate turn date, which was scheduled for October 2nd, but looks to have actually occurred a day later on October 3rd. Stocks plunged Thursday, then recovered a portion of the decline later in the day, but ended down. The reason financial news networks gave for the decline was that long-term interest rates rose, and further they spun the rise in interest rates as a good event, an indication of a robust economy. Nonsense. The Fed's Quantitative tightening policy of selling $80 billion of securities every month, a large chunk long term, has flooded the market with supply, causing bond prices to drop and required rates of return to rise. This economy is not rip roaring, the stock market is topping, and a major bear market and decline is at high risk of beginning soon, with a recession to follow.

There are 19 Hindenburg Omen observations on the clock, an extraordinary quantity associated with an official H.O. potential stock market crash signal. At best, this indicator is telling us the stock market is in a fragile condition. At worst, a plunge is coming. Bearish divergences are all over the place as shown in last weekend's report.

Techs really took it on the chin Thursday, and all our key indicators for the NASDAQ 100 generated New Sell signals Thursday. Our Blue Chip Purchasing Power Indicator and Demand Power / Supply Pressure Indicator generated new Sell signals Thursday. Small caps got hit hard. New NYSE 52 Week Lows skyrocketed to 426. Over 70 is considered to be high. The stock market currently sits at its greatest risk of a crash since September 2008. This does not mean a crash is certain, but many of the conditions that typically precede crashes are in place right now."

canary · Oct 5, 2018 - 1:48am

Come Monday, gold's not headin' to San Francisco for a weekend show....goes to Shanghai , instead.

Come Monday, it'll be all right.

We can go hikin on Tuesday...smiley

Ron Estrada · Oct 5, 2018 - 7:24am

 Are you ready to see arrests?

Are you ready to see PAIN?

Are you ready to be part of history?

Q

 DECLAS COMING?

NARRATIVE SHIFT IN FULL FORCE.

UK / AUS ASSISTED ROGUE ELEMENTS OF THE US GOV'T TO TAKE DOWN A DULY-ELECTED CANDIDATE/PRESIDENT.

Q

My own Q journey started around November or December 2017. I was curious after reading and watching You Tube videos from Q Anon researchers/detectives across the world. Q had to convince me over and over and over that Q was connected to President Trump and military intelligence. Finally around this summer after close to a 100 CONFIRMATIONS I was 100% convinced that Q was for REAL!!! Their plan has been long, detailed, and cleverly constructed to trick the Deep State into making many revelations along the way. Now it seems they are spilling the beans on one another in an attempt to survive. Very shortly we will see Brett Kavanaugh confirmed to the Supreme Court and then the declassification of documents will BLOW AWAY the propaganda, lies, and crimes that have subjected us for decades. NOW IT APPEARS THAT Q SAYS TO GET READY! 

lakedweller2 · Oct 5, 2018 - 8:38am

What does she look like?

· Oct 5, 2018 - 8:39am

Payrolls at only 134,000 vs expectations of at least 185,000. Wages as expected.

https://www.zerohedge.com/news/2018-10-05/september-payrolls-miss-big-just-134k-jobs-added-earnings-come-line

Mickey Silverstone · Oct 5, 2018 - 8:41am

no surprise.

lakedweller2 · Oct 5, 2018 - 8:45am

62+%

Mickey Silverstone · Oct 5, 2018 - 8:55am

when they play with numerators and denominators you can get desired results. Need to look at no longer in workforce

lakedweller2 · Oct 5, 2018 - 9:03am

Yes. 37%+ not in work force and I bet that is low as 3.7% unemployment means McDonalds is fully employed with some nuclear physicists in line for the next assistant manager.

edit: In reality, JPMorgan former trading desk people who have been replaced by algos.

Mickey Silverstone · Oct 5, 2018 - 9:06am

Remember the entire report is a survey, a small sample, where bls and census workers at all levels can change whatever they can change whenever they want.

Thomas More · Oct 5, 2018 - 9:14am

https://www.zerohedge.com/news/2018-10-05/vix-flash-crashes-stocks-pumpn...

whipsawing themselves around. As a Turdite you gotta love that kind of storyline. 

· Oct 5, 2018 - 9:22am

Trump boards his backup Air Force One with toilet paper stuck to his shoe. <eye roll>

Orange · Oct 5, 2018 - 9:26am

He probably did that on purpose and may signify something.

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The TFMR Silver Round

Key Economic Events week of 6/11:
6/12 Trump-Kim summit
6/12 8:30 ET CPI
6/13 8:30 ET PPI
6/13 2:00 ET June Fedlines
6/13 2:30 ET CGP presser
6/14 8:00 ET Count Draghi presser
6/14 8:30 ET Retail Sales
6/14 10:00 ET Busi.Inv.
6/15 9:15 ET Ind. Prod

Key Economic Events week of 6/4:
6/4 10:00 ET Factory Orders
6/5 9:45 ET PMI Svcs
6/5 10:00 ET ISM Svcs
6/6 8:30 ET Intl Trade and Productivity
6/8 10:00 ET Wholesale Trade

Key Economic Events week of 5/28:
5/30 8:30 ET Q2 GDP 2nd guess
5/31 8:30 ET Personal Income
5/31 9:45 ET Chicago PMI
5/31 10:00 ET Pending Home Sales
6/1 8:30 ET BLSBS
6/1 9:45 ET PMI Manu Index
6/1 10:00 ET ISM Manu Index
6/1 10:00 ET Const Spend

Key Economic Events week of 5/21:
5/22 10:00 ET Richmond Fed
5/23 9:45 ET PMI Composite
5/23 10:00 ET New Home Sales
5/23 2:00 ET May FOMC minutes
5/24 10:00 ET Existing Home Sales
5/25 8:30 ET Durable Goods
5/25 9:20 ET Chief Goon Powell speech

Key Economic Events week of 5/14:
5/15 8:30 ET Retail Sales and Empire State Fed
5/15 10:00 ET Business Inv.
5/16 8:30 ET Housing Starts
5/16 9:15 ET Industrial Production
5/17 8:30 ET Philly Fed

Key Economic Events week of 5/7:
5/9 8:30 ET PPI
5/9 10:00 ET Wholesale Trade
5/10 8:30 ET CPI
5/11 8:30 ET Import/Export Prices

Key Economic Events week of 4/30:
4/30 9:45 ET Chicago PMI
4/30 10:00 ET Pend Home Sales
5/1 9:45 ET PMI and ISM Mau Idx.
5/1 10:00 ET Const. Spending
5/2 2:00 ET FOMC fedlines
5/3 9:45 ET PMI/ISM Svcs.
5/3 10:00 ET Factory Orders
5/4 8:30 ET BLSBS

Key Economic Events week of 4/16:
4/16 8:30 ET Retail Sales, One Fed Goon speech
4/16 10:00 ET Business Invt.
4/17 9:15 ET Industrial Prod., Four Goon speeches
4/18 Two Goon speeches
4/19 8:30 ET Philly Fed, One Goon speech
4/20 Two Goon speeches

Key Economic Events week of 4/9:
4/10 8:30 ET PPI
4/10 10:00 ET Wholesale Trade
4/11 8:30 ET CPI
4/11 2:00 ET March FOMC minutes
4/12 8:30 ET Imp/Exp Prices
4/13 Fed Goon Speeches...Rosengren 7:30 ET, Bullard 9:00 ET, Kaplan 1:00 ET

Key Economic Events week of 4/2:
4/2 9:45 ET PMI Mfg Idx
4/2 10:00 ET ISM Mfg Idx and Construction Spending
4/4 9:45 ET PMI Svcs Idx
4/4 10:00 ET ISM Svcs Idx and Factory Orders
4/5 8:30 ET Intl Trade
4/6 8:30 ET BLSBS

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