Just like hurricane’s today- Financial perfect storms brew far off the coast where nobody is paying attention. But the signs are there and the winds should have been paid attention to.
- ISM New York index expected a 67—Actual Forecast 65
- ISM manufacturing new orders index expecting 62.1–actual forecast 51.1
- ISM manufacturing prices expecting a 60.7— actual forecast 54
- ISM manufacturing PMI expecting a 59.3— actual forecast 54.1
- ISM manufacturing employment expecting 58.4–actual forecast 56.1
The US economy is experiencing a massive home sale decline. As home sales decline so do home values. As home values decline the wealth effect begins to evaporate. American’s will feel less inclined to spend- or better yet to borrow and spend.
The cause and effect is being shown in a slow down in manufacturing. As manufacturing slows down, jobs will be cut, as shown in the manufacturing employment weakness. Not even a trade war with China has increased domestic output for American consumption.
The US economy is dependent on spending. Its all about spending, spending, and more spending.
Before of this spending tenement in our economy- we can’t afford to raise interest rates much higher. Raising the cost of borrowing chokes off our main economic driver.
If we aren’t raising interest rates much higher- and the stock market is influx- than we have one bull market waiting on us.
Gold and silver are sitting at a tipping point. Gold has just crossed into a net long position by commodity traders. Shorts will be on the run.
Buy gold and silver before the bubble. Last frontier of the bull markets before 2020.