Still Askew
US producer prices rose far more than expected in July, the government said Thursday.
The PPI gauge for final demand rose 1% last month, matching June's gain, and extending a long streak of elevated monthly prints (figure below). The market was looking for a comparatively modest 0.6% gain. The range of estimates from nearly five-dozen economists was 0.2% to 0.8%, so the headline was hotter than the highest forecast.
The data came on the heels of a July CPI report which suggested the most acute
And yet Gold languishes in a bear market while the fed prints trillions, multi trillion dollar deficits and inflation at 40 year highs. Something doesn’t smell right!
Maybe nobody wants gold because folks have finally come around to the reality that it’s an inert piece of metal with no internal rate of return and no real-world use (gasp!)
If gold can’t rally when US reals are languishing in deeply negative territory, then one wonders when it can rally.
It’s had a good run. Serving as a reliable store of value across centuries despite being totally useless is a pretty impressive accomplishment. Maybe it’s time to retire it.
Crypto fanatics would argue they have already replaced precious metals as an alternate store of value. Barring some catastrophic breakdown in the vast networks spanning the globe on par with a global EMP, gold really has no purpose as a store of value. People aren’t mailing slabs of heavy yellow stuff USPS to each other in exchange for goods and services.
I’m always amused by those moments when H’s rhetoric serendipitously aligns with crypto/blockchain geeks!
Because that’s illegal, otherwise, yeah I think they’d be fine with it.
Heisenberg you silly romantic. Gold is used for jewelry! Most of the female sex like jewelry for its attributional value and beauty. How about the utility of diamonds at their really silly monopolistic prices? Cubic works equally well for me. Tell my wife that though! Haha!
Women aren’t the only group that wears gold. I have more than my share. It does have many industrial uses, many in high tech. Got some in my mouth, too. My gold “hoard’ was all bought at less that $1200/oz. Love it.
I could say the Earth was flat and it would be less controversial than me saying gold is worthless.
I do own gold, just like every other investor on the (round) Earth, btw. But in the bare minimum amount I can get away with and still call myself “prudent” in a traditional sense of the word.
(I still own no crypto)
Gold just hasn’t been the same since Disco…Puka shells too…though I do agree with RIA in that the female population of the world will likely keep its price at reasonable levels…folks in developing countries who accumulate it to hedge their volatile currencies as well…the latter will probably evolve to cryptos but it will take a fair amount of time…
finally. so glad to see gold dismissed, and some negative news inthe msm too, about how awful its performance has been this calendar year. gold had been beating the sp500 the past 3 years until Feb and was tied going into mid year 2021…for 3 years. now that price has been difficult..’everybody’ knows that gold not a place to be. studies of long term prices of gold do hold that its a hedge for inflation. shorter term gold rises alongside a growing economy….and in the very short term its a ‘fear’ play.