Fed Hikes; Silly Myths about Interest Rates & Gold Persist The Fed finally acted this week – upping its benchmark Federal Funds rate by 0.25%. Now that the speculation over whether the Fed will hike has been put to rest, analysts are busily speculating about what the Fed’s move means for the economy and markets….
It is unsettling to deal with the probability that we are closer to a bearish decline in stocks than a bullish reboot. Investment account values will wane. Household net worth will diminish. And when stock prices near their lowest ebb, the typical investor will decide that buying is impractical. However, if one prepares for inevitable…
So here we have it – the first rate hike in nearly a decade. The Fed hiked rates a quarter point on the federal funds rate in a unanimous vote. This is the overnight rate member banks get when they need to borrow to meet reserve requirements. Dropping that little pebble in the pond ripples across the…
It appears that the Central Gold Trust, Sprott Gold and Sprott Silver have all sold some bullion to return their cash assets back into the black. The only one that did not have to sell was the Central Fund. Although it has the currently worst discount to NAV, it has one of the better cash…
Gold prices are cheap in the face of unprecedented and coordinated global quantitative easing among central banks. However, if the Fed makes good on its promise to gradually raise interest rates, then gold prices might get even cheaper. Once some semblance of supply-demand equilibrium can be restored to the energy markets to stabilize oil prices, this removes…
For an economy that is supposed to be on the verge of overheating, or at least moving decisively in that direction, there are an inordinate number of indications of a cyclical stall and termination rather than some beginning (or ripening). I’m not referring exclusively to economic indications, either, such as the Federal Reserve’s own industrial…
McDonald’s Corporation (MCD – Analyst Report) has only just begun its turnaround, but already investors believe. Shares of this Zacks Rank #1 (Strong Buy) recently hit an all-time high. Is it too late to get in? McDonald’s is the iconic American burger chain. It operates over 36,000 restaurants around the world. For the last few years, McDonald’s has…
The Federal Reserve has finally begun to tighten short-term interest rates, announcing a quarter percentage point increase Wednesday in the target range for the federal funds rate to 0.25 percent to 0.5 percent. I believe the Fed will push rates up for about two years. Long-term rates will rise less rapidly, but for just as…
Ho hum. Another manufacturing report, and another debacle. The Philly Fed report came in much worse than expected and is back in contraction at -5.9, below the Econoday Consensus estimate of 1.2 and even below the lowest economist’s estimate of -5.0. The negative headline, below Econoday’s low-end estimate, isn’t even half of story for the December Philly…
General Mills Inc. (GIS – Analyst Report) reported soft second-quarter fiscal 2016 results, missing the Zacks Consensus Estimate for sales and only managing to deliver in-line earnings. Moreover, the company lowered the previously issued sales and earnings outlook for fiscal 2016 to account for the Green Giant business divesture. Shares declined 1.8% in pre-market trading. General Mills divested…
