3 Minute Gold News
A Quick Read for Busy People
A 3 minute synopsis of an interview with Jim Rickards, New York Times bestselling author of The Death of Money, by Deirdre Bolton from Fox Business News.
Topics:
Eurozone
Russia
Interest Rates
Bonds and Oil
2015
Jim Rickards
Fox Business News
Deirdre Bolton
EUROZONE
The Eurozone as a whole is the largest economy in the world, it has a larger population than the United States, and has 10,000 tonnes of gold.
If the Anti-Euro party wins in Greece then it’s going to be a disaster for Greece, but It’s been Jim’s view all along that the Eurozone will stay together.
RUSSIA
The Russian economy is collapsing and Russia has inflation, but it’s denominated in rubles. If you pay in US dollars then you actually have deflation.
INTEREST RATES
The whole world expects the US Fed to raise interest rates around the middle of 2015.
The Fed has always said they’re data dependent, and the data is going to come in weak. The year 2014 is going to be the same growth of 2 – 2 1/2% that the US has had for seven years, so they’re not out of the depression they’ve been in.
Jim doesn’t see how they can raise interest rates in the face of the weak data.
If they do raise rates then the stock market will fall apart. If they don’t raise rates then the stock market could end the 2015 year higher on the easy money.
BONDS AND OIL
There’s nothing wrong with high grade corporate bonds, but a lot of the corporate bond market is junk debt or lower rated debt.
A lot of that debt went into energy development and that’s going to fall out of bed — it already has with the lower price of oil.
Those projects were priced with oil being between $80 – $130 US per barrel, but with oil between $50 – $60 that’s going to mean massive defaults — but not right away.
They can struggle through for a while, but late 2015 look for defaults.
The energy debt and emerging markets corporate debt is upwards of $10 trillion, and even with just 20% defaulting that’s twice as big as the sub-prime crisis.
The US government bonds are going to head in the direction of Japan, and there’s going to be a major rally in 10-Year Treasury notes, but corporate bonds are a completely different story.
2015
If the Fed raises rates and the US dollar remains strong, then on a scale of 1 – 10 it’s a 9 that in late 2015 or early 2016 there will be a major credit crisis like 1997-1998, as energy and emerging market debt collapses.
If the Fed doesn’t raise rates then it means more easy money, which will create asset bubbles that collapse eventually.
They might keep the game going for another year.
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Lithuania Joins the Eurozone Today
Gold is the Second Best Performing Currency of 2014
Greece Snap Election on Jan. 25th
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Best wishes to all readers for a beautiful and unique 2015.
There’s been 23,000 visitors to this site in 2014.
Thank you.
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words and music Elaine Diane Taylor
© 2014 Intelligentsia Media, Inc. All rights reserved. SOCAN/ASCAP
from the album Preparing for the Fall available soon on iTunes
Another Week on Wall Street
words and music Elaine Diane Taylor
© 2013 Intelligentsia Media Inc. All rights reserved. SOCAN/ASCAP
from the album Coins and Crowns available on iTunes
Elaine Diane Taylor 