The Following Article was originally posted on CoinWeek.com on March 13, 2013 8:56 PM

Jim Kingsland passed on Thursday, March 7, 2013. He was forty-nine years old. His funeral was held in New City, New York, on Monday, March 11. In addition to being a coin collector, Jim was an influential journalist and financial analyst in the New York Metropolitan area. He was also the author of a book on “Coin and Precious Metal Values,” which was published in 2010 by Random House.

As it is clear enough that his family is very saddened by Jim’s death, it makes sense here to provide some background regarding his career and his ties to the coin collecting community. Most collectors are not aware that Kingsland was a force in the mainstream media for coverage of news events that related to rare coins or bullion.

I am glad that I had the opportunity to meet Kingsland and talk to him about matters relating to rare coins, writing and broadcast journalism. I did not, though, know him well. Scott Travers had a long professional relationship and personal friendship with Jim. Travers is the author of a perennial best seller, The Coin Collector’s Survival Manual, and other books.

Travers was extremely familiar with Kingsland’s radio show on an AM channel in the New York area. “Maurice Rosen, PCGS founder David Hall, CoinAge editor Ed Reiter, Barry Stuppler, David Ganz, Greysheet publisher Shane Downing, and ANA President Tom Hallenbeck all participated in Jim Kingsland’s popular, live radio show that reached eleven million listeners in the Middle Atlantic States,” Travers declares.

Maurice Rosen recollects that “my fondest memories of Jim were when we were co-speakers at coin convention educational events. I was always impressed with his keen knowledge of the precious metals markets and the economic, monetary and political factors influencing their prices. Jim was a rising star in numismatics; it’s tremendously sad his ascent was cut short.”

John Albanese, the founder of the CAC and the primary founder of CoinPlex, remembers Kingsland. “Even before Jim worked for CoinPlex, I listened to his radio show. He was an expert in gold bullion markets and knowledgeable about financial markets in general.”

Travers emphasizes that “Kingsland was an important voice in the coin community.” Indeed, Scott points out that “Jim was an essential conduit between the coin industry and global media outlets. With just a phone call, he could get [coin related] news on major TV new shows.” Travers reveals. He had important positions with Bloomberg, CNBC and Fox.

“Kingsland’s first important position was at Bloomberg,” Travers notes. “Mike Bloomberg had hired him away from 1010 WINS [radio station]. Kingsland assisted in the launching of the extremely successful Bloomberg terminal for financial services. Later, Kingsland was [instrumental] in having coins and other collectibles listed on the Bloomberg terminal. In the early 1990s, Mike Bloomberg introduced him to me,” Scott fondly recollects.

After Kingsland bravely battled serious illnesses, John Albanese offered him a job. “He worked for CoinPlex during our formative stages and helped us get off the ground. Jim will be missed,” John says.

Travers remembers Kingsland’s collecting activities. “He collected silver dollars because they are large and easy to grade. He had problems with his eyesight.”

“Towards the end of his career, Jim became a field producer and the webmaster for Fox Business Network,” Scott adds. Kingsland continued to be a force “behind the scenes,” who often had coin collectors in mind.

©2013 Greg Reynolds

As Written on 1/20/13
Greetings everyone!

First, I remain hospitalized with liver and kidney failure. this commentary will be brief and may contain some typos and some punctuation errors.

so here we are, already half way thru January with a gold price in the $1680 range. I am actually pleased to see gold at this level. The naysayers have been wrong about an imminent collapse for gold and other metals.

The financial world is ever more levered up with debt. A majority of Americans realize that government spending, the financial gods pay no attention to the people; the printing and budget less, reckless spending remains the objective of the financial psychopaths.

These negative financial factors IMHO will only mean a stronger gold price. I think the dollar will suffer due to the consequences from what is going on durjhing the paradigm we find ourselves in.

I often do not comment on silver. Until the CME lowers margins further, silver will move more slowly to the upside in my opinion.

Have a great day!

Jim Kingsland is off today due to illness. If you haven’t, please be sure to watch this video.

Gold may be weak again due to year end selling pressure, but its bull market remains intact.

Goldcore has graciously given CAMI permission to put its educational video about gold on the CAMI site.

This is definitely worth a watch. If the pace is too fast, use the players pause button to read the information more slowly. If the music is not your style, turn the volume down. I like both the pace and the music. This is a well done presentation!

12/10/12

Japan has slid into recession, China’s exports are weaker than expected, Europe remains Europe and whether the Fiscal Cliff leads to a constitutional crisis over the debt ceiling are but a brief laundry list for investors to contend with. Stock futures are flat to a bit lower and a stronger bid has come back to gold futures.Not to sound like a broken record, but Fiscal Cliff developments and other headlines will have the greatest impact on markets.

Technicals matter too, I realize, but they do not predict sudden events, though I fully recognize that technicals can play an important role in measuring the potential length of a move within the markets. Apple, for example, is a curiosity with it’s so called death cross chart pattern formation. $500 would not be a surprise, but it won’t happen in a day.

A few weeks back I had noted that if gold weakened $1675 looked to be a bottoming point. It had moved very close to that area last week. It’s climb bach above 1700 is a positive, but year end weakness could persist if gold has trouble again with the 1730 to 1750 range.

A Gold Video

This is the video of the year. This is the gold bullion vault of the Bank of England. A Chemist (University of Nottingham’s chemistry Professor Martyn Poliakoff)  gives the tour. It’s a must watch from the perspective of seeing the amount of gold in storage.

Published on Dec  7, 2012 via Youtube

12/7/12
Labor Market
This may sound a bit crass, but there’s nothing like smell of B.S. in the morning. 7.7% unemployment in November should be viewed as better news regarding the labor market, but that headline figure is clouded by another 540,000 people having left the labor force in last month. The labor force participation rate, at 63.6, remains at multi decade lows (think at the level when Ronald Reagan was President. With the increase of 540 thousand more people out of the labor force, the total number of people no longer being counted is 88.8 million. Is that a good thing? No.

I will never be able to spin this data positively so long as hundreds of thousands of people each month are statistically reported as leaving the workforce.
–
Flying Under the Radar – CFTC Charges Against 12 Commodities Firms
Here’s a little piece of news that has gone virtually unnoticed. The system is corrupt to the core which is one of the  reasons it shall fall apart. Anyone think this will result in crippling fines, or jail time for the people and firms allegedly involved? Haha.. think wet noodle punishment should there be convictions.
From the Commodities Futures Trading Commission:
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced that on December 5, 2012, it filed a civil injunctive enforcement action in the U.S. District Court for the Southern District of Florida against Hunter Wise Commodities, LLC; Hunter Wise Services, LLC; Hunter Wise Credit, LLC; Hunter Wise Trading, LLC; Lloyds Commodities, LLC; Lloyds Commodities Credit Company, LLC; Lloyds Services, LLC; C.D. Hopkins Financial, LLC; Hard Asset Lending Group, LLC; Blackstone Metals Group, LLC; Newbridge Alliance, Inc.; United States Capital Trust, LLC; Harold Edward Martin, Jr.; Fred Jager; James Burbage; Frank Gaudino; Baris Keser; Chadewick Hopkins; John King; and David A. Moore. The complaint charges these entities and individuals with fraudulently marketing illegal, off-exchange retail commodity contracts. The complaint alleges that Hunter Wise Commodities, the orchestrator of the fraud, has taken in at least $46 million in customer funds since July 2011.
According to the CFTC complaint, the defendants claim to sell physical metals, including gold, silver, platinum, palladium, and copper, to retail customers in retail commodity transactions. Under the defendants’ retail commodity transactions investment contract, customers allegedly make a down payment on certain quantities of physical metals, usually 25 percent of the total purchase price. Defendants allegedly claim to arrange loans for the balance of the purchase price, and advise customers that their physical metals will be stored in a secure depository.
The complaint further alleges that these statements were false, and that the defendants do not purchase any physical metals, arrange loans for their customers to purchase physical metals, or arrange for storage of physical metals for any customers participating in their retail commodity transactions. Instead, all the transactions are just paper transactions, according to the complaint. Defendants allegedly do not own or sell metals to customers; customers are charged storage and insurance fees on metals that do not exist; and are charged interest on loans, which are never made by the defendants.
The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) of 2010 expanded the CFTC’s jurisdiction over transactions like these, and requires that such transactions be executed on or subject to the rules of a board of trade, exchange or commodity market, according to the complaint. This new requirement took effect on July 16, 2011. The complaint alleges that all of the defendants’ financed commodity transactions after July 16, 2011, were illegal. The complaint also alleges that the defendants defrauded customers in all of these financed commodity transactions.
David Meister, the CFTC’s Director of Enforcement stated: “Here is a prime example of how the Dodd-Frank Act provided the Commission with additional strong authority to go after wrong-doers, such as, as alleged in the complaint, individuals who prey on people looking to make retail investments in commodities like gold and silver. We will use this new authority to the fullest extent possible.”
In January 2012 the CFTC issued a Consumer Fraud Advisory (see Advisory under Related Links) regarding precious metals fraud, saying that it had seen an increase in the number of companies offering customers the opportunity to buy or invest in precious metals. The CFTC’s Consumer Fraud Advisory specifically warned that frequently companies do not purchase any physical metals for the customer, instead simply keeping the customer’s funds. The Consumer Fraud Advisory further cautioned consumers that leveraged commodity transactions are unlawful unless executed on a regulated exchange.
In its continuing litigation against the defendants, the CFTC is seeking preliminary and permanent civil injunctions in addition to other remedial relief, including restitution to customers.

Jim again: Folks, metals manipulation is real. While that may sound like conspiracy theory talk, it’s not.
–
Gold and Morgan Stanley
Following up on yesterday’s call on Goldman Sachs proclaiming the coming end to the gold bull market – not everyone agrees: MORGAN STANLEY: Here Are 4 Reasons Why Gold Is Our Favorite Commodity For 2013 http://www.businessinsider.com/morgan-stanley-gold-2012-12?0=moneygame … via @themoneygame
I am inclined to agree with Morgan Stanley. It’s not just because I am a long term fan of gold. I agree with MS due to future fundamentals ranging from ever increasing sovereign debt to changes to banking regulations that will make gold a Tier One asset. It’s a no brainer to have strong exposure to gold and it’s true nature as a hedge against unthinkable catastrophic financial developments.
–
Guns and Gold
Smith & Wesson announces a 48% Surge in revenue. The firearms maker boasts $21.2 million quarter… http://bit.ly/YIOco4 . As Washington and specifically the present Administration appear to be on a course to gut the 2nd amendment more people are buying guns.
The surge in gun sales coincides with the recent report that U.S. gold coins had their strongest November sales in 14 years http://reut.rs/WzuPa5 . There are people paying attention to what’s going around them.
Will gold rise next week? Quoting from ZeroHedge.com…
UBS and Nomura have suggested that gold could rise next week as the Federal Reserve may announce further easing at the FOMC meeting – on Tuesday (11/12/12) and Wednesday (12/12/12). Nomura said it is worth considering whether the FOMC will announce further easing to replace so called ‘Operation Twist’. The research house noted that gold remains at the same level as during the October meeting, which suggests gold has not yet priced in any move by the FOMC – creating an opportunity for gold bullion buyers. Regardless of whether the FOMC actually eases at this point – Nomura thinks there is a non-negligible probability – gold is likely to rise. Therefore, Nomura expects gold to rise and prices in this probability as the December meeting approaches, just as gold rose when the September meeting was approaching
Read more here: http://www.zerohedge.com/news/2012-12-07/gold-%E2%80%98storm%E2%80%99-could-rise-sharply-next-week-fed-say-ubs-and-nomura

An interesting little video clip

America’s debt load visualized in $100 bills. In my opinion there is no way out unless a economic game changer comes along.

Perhaps the U.S. should mint a few trillion dollar platinum coins! CNBC: The Trillion-Dollar Coin Is Back http://soc.li/63pL2zN
–

Have a day!

12/6/12

Goldman and Gold

They’ve become bearish on gold at Goldman Sachs. From its report:

“Improving US growth outlook offsets further Fed easing
Our economists forecast that the US economic recovery will slow early in 2013 before reaccelerating in the second half. They also expect additional expansion of the Fed’s balance sheet. Near term, the combination of more easing and weaker growth should prove supportive to gold prices. Medium term however, the gold outlook is caught between the opposing forces of more Fed easing and a gradual increase in US real rates on better US economic growth. Our expanded modeling suggests that the improving US growth outlook will outweigh further Fed balance sheet expansion and that the cycle in gold prices will likely turn in 2013. Risks to our growth outlook remain elevated however, especially given the uncertainty around the fiscal cliff, making calling the peak in gold prices a difficult exercise.”

Read more: http://www.businessinsider.com/goldman-calls-the-end-of-the-gold-bull-market-2012-12#ixzz2EIAdzVtj

Jim again: Believable if the economy does strengthen 2^nd half of next year.  Eventually there will be a turn in this cyle of economic malaise, but with the Fed saying it’s on hold through 2014, a strong 2^nd half 2013 is hard to fathom at this point.

The Tax Man Cometh

Notices from payroll departments to employees are starting to go out. It goes something like this:

“Important changes to your tax withholding amounts effective January 1, 2013

The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 that was signed into law in December 2010 will expire on December 31, 2012. What this means to you:

· The temporary 2% cut in employee Social Security withholding (from 6.2% to 4.2%) effective on January 1, 2011, will expire, and the rate will change back to 6.2%.

· The Social Security wage base is increasing from $110,100 to $113,700, resulting in the maximum tax being increased from $4,624.20 to $7,049.40.

· In addition, the Patient Protection Affordable Care Act of 2010 increases the Medicare part A payroll tax by 0.9% (from 1.45% to 2.35%) for all income above $200,000.
Other possible changes effective January 1, 2013:

Tax-related provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) also are set to expire on December 31, 2012 impacting Federal Income Tax withholding. What this means:

· The 10% income tax bracket is eliminated; the lowest bracket will be 15%. The top four brackets will change as shown below. To:

25% to 28%
28% to 31%
33% to 36%
35% to 39.6%

· Optional flat rate tax on Supplemental Wages up to $1 million in a year increases from 25% to 28%.

· Mandatory flat rate on Supplemental Wages over $1 million in a year increases from 35% to 39.6%.

The information above reflects the legislation currently in effect. If the laws change, we will send an update as early as possible in January 2013.”

Jim Again: This yet another indicator of just how money hungry the Federal government has become and it’s only going to get worse.  This is not about taxing just the so called “rich”. Everyone is going to take a hit – don’t be fooled.

Let’s face it, the country has already gone over the fiscal cliff and has managed to catch hold of a branch sticking out from the cliff. But the branch is about to give way to deeper and darker fiscal abyss.

The biggest misconception ever is playing out before our eyes. The Washington insiders want you think that their games involving raising taxes and reducing spending  will ultimately solve our fiscal woes and all will live happily ever after. If both sides reach an agreement by the end of the year, it will merely be a pennies on the dollar salve to a problem that over the next 20 years is actually $100 trillion in size when future liabilities for Social Security, Medicare and other government programs are factored in. It’s as if most fail to grasp the true size and scope, or what is really at stake. Even in the realm of trillions of dollars, should the present negotiations bear 1.6 trillion in enhanced revenue and a piecemeal $400 billion in cuts (as proposed by Obama),  those targeted amounts are nothing when compared to the overall size of snowballing government costs that will be unrelenting until the last of the baby boomers are dead.

Related: IRS finalizes new tax for medical devices in healthcare law http://reut.rs/Vnq81V via @reuters

What’s The Solution?

Your Federal government can only do patches to its very leaky fiscal dam.

The solution could lie in what I like to call “the Next Big Thing”. Unfortunately, the next big thing could come a bit too late. Goldman Sachs recently noted the U.S. could become energy independent by the end of the decade.

Read more  here: http://www.goldmansachs.com/gsam/docs/fundsgeneral/general_education/economic_and_market_perspectives/ps_us-energy-revolution-tpd.pdf

Others say the U.S. could even become a dominating energy exporter by the end of the decade which would enable the country to regain the upper trading hand vs China and other countries who are dependent on oil imports.  I also believe that Biotech could deliver a game changing surprise by way of a cure for a major disease that could tremendously boost the cash flow (wealth) of the nation.

New innovation had better come sooner rather than later. It is clear to me that the approach of higher taxes, spending cuts and ever increasing debt only puts the country deeper into the hole and comes up woefully short. Right now, the outlook for the economy looks very bad, but a real Next Big Thing could come to the rescue.

Yes, history does rhyme and not all history lessons have bad outcomes. The bozos in Washington have no solutions. It’s the innovators across the fruited plain who will come up with the solutions, not the political tripe.  

–

12/5/12

Jim Kingsland is off today due to illness. If you haven’t, please be sure to watch this video.

Gold may be weak again due to year end selling pressure, but its bull market remains intact.

Goldcore has graciously given CAMI permission to put its educational video about gold on the CAMI site.

This is definitely worth a watch. If the pace is too fast, use the players pause button to read the information more slowly. If the music is not your style, turn the volume down. I like both the pace and the music. This is a well done presentation!

Best,
Jim K

12/3/12

First things first. Our sympathies to the family and friends of Johnathan Auerbach. From the NY Times:

JONATHAN L. AUERBACH

AUERBACH–Jonathan L., beloved husband and father, international businessman and avid supporter of the arts, died November 29 in New York City. He was 70 years old. Jonathan is survived by his wife, Annie Luce, and his four children, Gabrielle, Jake, Nick and Sasha, his father Joseph Auerbach, and sister Hope Pym. He was a founder and managing director of Auerbach Grayson& Company, which provides international securities research, execution and settlement for U.S.institutions. The firm, which he started in 1993, was the capstone of a career in international securities trading and marketing that spanned more than 40 years. Jonathan was a graduate of Yale University. After his graduation from Yale he served in the U.S. Army. A multifaceted person with wide-ranging interests, Jonathan was involved in art, theater, film, environmental advocacy and vintage car road rallies. In May this year he took part in the Trans-America Rally in his 1951 Chrysler New Yorker, navigated by his son Jake, and they drove over 4000 miles from New York City to Vancouver. He also competed in several motoring events and rallies outside of Trans-America including the Mount Washington ‘Climb to the Clouds’ and the New Jersey ‘Vintage Grand Prix.’ He served in leadership roles at the Shakespeare GlobeCenter in the United States and the GlobeCenter in London, which he helped found. He produced the acclaimed underground film “Vortex,” which was selected for the New York Film Festival and other major festivals, and appeared in the film Belladonna, which premiered at the Whitney Biennale. Jonathan was also committed to providing opportunities for young people. He combined this passion with his love of international business by establishing a number of internship programs that gave students the opportunity to participate in the development of capital markets in emerging countries. He also started a scholarship fund at his alma mater, Noble and Greenough School, in Dedham, MA, to provide assistance primarily for students from emerging markets. He also served as a trustee of the Dwight School. Jonathan had a deep affinity forAfrica as a developing nation. His friendship with conservationist and Nobel Peace Prize recipient Wangari Maathai inspired him to support the Green Belt Movement with a reforestation project in the Machakos District of Kenya. Memorial service to take place in January.

Published in The New York Times on December 2, 2012

 A Sandy thought: Over 300k cars lost in the hurricane. Expect better sales numbers in the near term for autos.

Wall Street

No one in the fiscal cliff saga lobbed any nuclear bombs on the Sunday tv talk show circuit. Yes, the treasury secretary seems very confident that the republicans will go along with tax increase. The republican rhetoric presented a countenance of surly defiance. At at the end of the day both parties feed themselves from the same financial trough and are likely not to allow the country to go over the cliff (read 11^th hr agreement) because it would hurt the DC elite as much as the pesky people of the country.

The prevailing winds in Washington are also starting to give a whiff of the pungent odor of taking the debt ceiling responsibility away from Congress to the relief of those sissy’s in Washington. Why have limits? We are in the realm of relativism – do whatever you want. This would fit perfectly into society.

I see market upside potential if they get through the fiscal cliff and the separate issue of the debt ceiling.

Though one should be aware of technicals. The Three Peaks and  a Dome chart pattern is showing up again. In this environment, it is not advisable to married to any direction (long, short) and instead to be nimble. Hedging, very important.

 Gold

People are buying gold: Last 30 days have seen the largest physical gold sales on record. Interesting.. http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2012/11-2/20121201_Gold.png …

Oopps: Austrian central bank inadvertently reveals that they are leasing out most of their goldhttp://goo.gl/2Ptzr

The active contract for Gold at the COMEX is now the February contract as of today.

U.S. Gold Coins Set For Strongest November Sales In 14 Years http://bit.ly/YpyPAG

How Gold Fields Got Rid Of 90% Of Its South African Workers Without Firing Anyone http://bit.ly/YpA6rA

11/30/12

Who do you suppose wrote this:

“Obama offers plan for ‘cliff,’ not compromise”

Finished Guessing? None other than the Washington Post. Funny that the lefty Washington Post calls Obama out for being stubborn. All I can say in reaction is to follow the bouncing ball otherwise known as the stock market.  On CNBC there is a link to a report from a “pro” who says stocks will sell off today. His guess is as good as yours. If the market should sell off no doubt it would be due to nervous folk fearing what political rhetoric will be spewed on the Sunday morning talk shows.

–

The latest economic data. More good news! (not)

The headline says it more: “Tapped Out US Consumer Makes, Spends Less In October, Real Income Falls For Third Month”

The spin is this latest poor showing for these number is due to Sandy. But let’s be real, Sandy wreaked it’s havoc in the last four days of the month, and it’s likely that ahead of the storm there was increased spending for pre storm preparation. Spin Spin Spin. For those who think 2013 is going to be a barn burner of an economic year, I would say think again, or buy more lottery tickets.

–

Gold

One of the major factors in favor of gold that I have been harping on recently is coming changes in Basel III banking regulations. The big news is that gold is headed for Tier One asset designation under the new banking rules.  Here is fresh information. Gold: The Solution To The Banking Crisis? | ZeroHedge http://www.zerohedge.com/news/2012-11-29/gold-solution-banking-crisis

Related: Visualizing The World’s Gold Mines And Deposits http://www.zerohedge.com/news/2012-11-29/visualizing-worlds-gold-mines-and-deposits …

Have a Weekend!

11/29/12

Fiscal Cliff Schizophrenia

Yesterday the stock market took Obama at his word and warmed up to the Obama idea that a fiscal cliff agreement could be reached before the DC rabble goes home for Christmas vacation. That sent stocks into rally mode. The Market will go up on warm and fuzzy rhetoric and it will go down if any of the so called leaderships so much as breaks wind the wrong way. That’s the outlook for the market over the coming month, or until the holiday break. My money is still on  the idea that when push comes to shove that even the DC fools are not total fools and shall come reach an unholy accord that will result in unintended consequences. One notable unintended consequences are the big dividend payouts we’re already seeing as 2012 draws to a close.

This chart says that whatever political nuts agree to, they are dealing with a big problem. More are getting a clue about just how deep in the hole the government is, but many are unaware – so long as the government cheese keeps coming.

My note to chart maker. I like the size and scope that is shown, but this is not just Obama’s problem, it’s also a problem of the Congress. Obviously even to cut $10 trillion over ten years would not make a meaningful dent. The U.S. is broke.

What’s Up With Gold?

It was down yesterday, but is up today. And when it was down yesterday, heavy enough buy volume came in to take gold off its lows. How do you suppose that happened?

The chart below shows a large trade of 15,000 contracts sold at just after 8 a.m. ET yesterday (Tuesday morning).  You can’t make this stuff up. Some other players jumped in and dumped another 20,000, or so contracts. That’s 3.5 million ounces of paper gold, or a lot of gold sold in a peculiar way in that it wasn’t gradually sold to maximize profit. While the intraday price of gold was slammed to 1,708, it recovered to about 1,715 by the end of the day. Shorts in $GLD have their hands full and are hoping for another takedown. I chalk this up to typical expiration shenanigans just days before contract expiration on Friday for the December contract. Either that, or some fund was forced to liquidate, or a fund thought it could coax more investors to sell than actually did. Plain fail.

The red verticle bars in the lower of the two charts represent volume. The Upper chart is the price of gold.

More Evidence About the Near Moribund Economy

Earlier in the week, I talked about that lousy Durable Goods Orders numbers. That report happens to be one of the better quality reports that the government releases in my opinion and it showed economic ugliness. Today the infamous GDP report was released – the report that comes with all sorts of odd and just plain bad adjustments – as if someone on a web dating site were to advertise themselves with a picture from 25 years ago, or whatever.

I am feeling ill today, so I will let http://zerohedge.com put it succinctly…

“One glance at today’s second read of Q3 GDP may leave some with the false impression that the US economy is soaring, because after sliding to 1.3% in Q2, and after a preliminary read of 2.0% in the first Q3 estimate, today’s print, which missed estimates of a 2.8% print, did nonetheless rise to 2.7%. “A stunning success”, the administration sycophants would say. Absolutely wrong. Because a quick glance at the underlying numbers shows the true picture of the economy which contracted far more than most expected, with personal consumption collapsing to 1.4% Q/Q, on hopes of a 1.9% rise, and down from 2.0%. In fact, at 0.99% personal consumption expenditures – the core driver of 70% of the US economy – were a tiny 36% of the headline number. Ironically today’s second GDP revision was far worse when analyzed at the component level, than the first Q3 estimate, which while lower overall at 2.0%, at least had personal consumption nearly 50% higher at 1.42%, or well over half of the total contribution. So what drove “growth” in Q3? Nothing short of the most hollow and worst components of GDP: Government Spending, which soared to 0.67% of the annualized number, the first positive print in years, and of course, Inventories, which were responsible for 30% of the headline number. Finally, and most importantly, Fixed Investment, aka CapEx, was a meager 0.1%, or the lowest GDP contribution since Q1 2011. Without CapEx there is no corporate revenue growth (and future hiring intentions) period.”

Who needs CAPEX, right? Just send money to Washington and they will spend it the right way. Uh huh.

If I miraculously recovered (eg. diabetes went away, damaged liver – from my diabetic coma of a few years ago – repaired itself, I could see 20/20 with glasses) I would go looking for a job in the government sector. That’s where future job growth is going to be as terrible as that sounds.

On that note,

Have a Day!