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Soaring gold prices and gold miners

As markets lose faith in the Fed’s ability to manage its easing pivot, gold and silver prices are soaring to new records notwithstanding hardening long bond yields. For investors wanting to participate in this trade, the choice seems to be between physical gold bullion, paper gold certificates or those mining the stuff. Those with a […]

Japanese MMT – the last domino to fall

Rising wage settlements and the falling Yen may have finally forced the Bank of Japan to reverse its negative interest rate policy, if recent media leaks ahead of its March meeting are to be believed. Behind this however, is the inexorable pressure to fund structural deficit spending when previous debt monetisations are cascading through into […]

More misdirection from US jobs data

Once again it is amusing to see the monthly US non-farm payroll statistics get used to provide cover for the usual misdirection by the US Fed/Govt. The approved message markets are meant to take from the BIS guesstimate of an improving trend in private sector net job additions in September (of almost +260k MoM), is […]

Rising US federal debt and maturites pose uncomfortable truths for ‘no/soft’ landing assumptions

As of the 1st September, US Federal debt was estimated to be nudging $32.6 trillion, having been increasing by approx +$1.4 trillion per quarter following the abandonment of the debt ceiling and the last vestiges of Congressional constraint. Annually, that represents almost $7tn of new debt, which together with a further $7.5tn of existing debt […]

NVIDIA – an anatomy of a valuation

Since the start of the year, NVIDIA’s stock price has trebled, while the consensus EBITDA has ‘merely’ doubled, even reaching out to FY25. While inevitably reflecting a medium term multiple expansion to bridge that gap, the actual mechanism is not some sort of opaque PEG type ratio, but the systematic relationship between growth and the […]

June US employment running warm, rather than hot – albeit a bit of a red herring for US Fed rates

If yesterday’s 10 year yield bounce to over 4% was a function of a more aggressive further interest rate rise by the Fed this month after the June ADP figures, then today’s cooler employment estimates for June from the BIS in its non-farm payroll figures may help dampen some of those fears. All this however, […]

Equity’s siren call into early stagflation

Has the US Federal Reserve lost control of the narrative? Much as it has tried to sound hawkish, its actual actions into the first half of this year have instead communicated a lack of real resolve, which along with the political retreat on fiscal control with the abandonment of the ‘debt ceiling’, has left equity […]

Treasury yields after debt ceiling ‘can-kicking’

Kabuki theatre remains alive and well in DC, and yet again, after all the histrionics from both sides of the aisle, the government will just keep spending money it doesn’t earn. While details have yet to be released, it seems the best result that Speaker McCarthy could secure was a budget cut of a measly […]

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