More than 186 US banks well-positioned for collapse, SVB analysis reveals Rising interest rates, which brought down the U.S. banking system’s asset market value by $2 trillion, combined with a large share of uninsured deposits at some U.S. banks, threaten banks’ stability. The perfect mix of losses, uninsured leverage and an extensive loan portfolio, among other factors, resulted in the fall of Silicon Valley Bank (SVB). Comparing SVB’s situation with other players revealed that nearly 190 banks operating in the United States are potentially at risk of a run. While SVB’s collapse came as a reminder of the fragility of the traditional financial system, a recent analysis by economists showed that a large number of banks are at risk from uninsured deposit withdrawals. It read: “Even if only h

U.S. dollar likely to continue to hammer the Euro currency(Kitco News) - The U.S. dollar index is a basket of six major global currencies weighted against the greenback. The USDX this week hit a 20-year high, supported by rising U.S. interest rates and safe-haven demand for the greenback and for U.S. Treasuries that are purchased in U.S. dollars. It’s not just that the U.S. economy is stronger or that U.S. interest rates are out-pacing the rate rises in other major economies. Rather it’s a combination of the latter and the fact that the Euro zone is facing an energy crisis and rising inflation that have sapped its countries’ economies and in turn put keen downside price pressure on the Euro currency against the U.S. dollar.It’s important to note that price trends in the currency markets te

What Is Stagflation?Stagflation is characterized by slow economic growth and relatively high unemployment—or economic stagnation—which is at the same time accompanied by rising prices (i.e. inflation). Stagflation can be alternatively defined as a period of inflation combined with a decline in the gross domestic product (GDP).KEY TAKEAWAYSStagflation refers to an economy that is experiencing a simultaneous increase in inflation and stagnation of economic output.Stagflation was first recognized during the 1970s when many developed economies experienced rapid inflation and high unemployment as a result of an oil shock.1The prevailing economic theory at the time could not easily explain how stagflation could occur.Since the 1970s, rising price levels during periods of slow or negative economi

Cathie Wood Watch: Ark Snaps Up More Tesla Shares Cathie Wood's flagship Ark Innovation ETF dropped 67% last year, and is down 80% from its February 2021 peak. Celebrity money manager Cathie Wood of Ark Investment Management, bought shares of her favorite young technology stocks last year as they slid. Ark’s chief executive has been a particularly big buyer of electric vehicle titan Tesla (TSLA) - Get Free Report since October. It has suffered from production problems, and there is concern that sales growth will slow. Investors also are worried that Chief Executive Elon Musk is preoccupied with his newly-bought Twitter. Tesla shares plunged 65% in 2022. Wood pounced on them Dec. 30, with Ark Innovation ETF (ARKK) - Get Free Report purchasing 221,748 shares, worth $27.3 million as of the De

Asia facing ‘stagflationary’ risks, IMF official warnsSenior official points to Ukraine war, soaring commodity prices and China’s economic slowdown as risks to the region.Asia faces a “stagflationary” outlook, a senior International Monetary Fund (IMF) official warned on Tuesday, pointing to the Ukraine war, soaring commodity prices and China’s economic slowdown as risks to the region.While Asia’s trade and financial exposure to Russia and Ukraine are limited, the region’s economies will be affected by the crisis through higher commodity prices and slower growth in European trading partners, said Anne-Marie Gulde-Wolf, acting director of the IMF’s Asia and Pacific Department.At the same time, inflation in Asia is also starting to pick up just as China’s economic slowdown is adding to press

Wall Street Faces Billion-Dollar Losses on Sinking Buyout Debt(Bloomberg) -- Investment bankers in the US and Europe are bracing for potentially billions of dollars in total losses on big-ticket leveraged buyouts as they struggle to offload risky corporate debt that’s plunging in value amid a sweeping market selloff.The biggest hit, which could amount to about $1 billion, may come from the take-private of Citrix Systems Inc., which a group of lenders led by Bank of America Corp., Credit Suisse Group AG and Goldman Sachs Group Inc. signed in January, according to people with knowledge of the deals and the terms at which banks underwrote them.Each of the three lead banks could face losses in excess of $100 million, said the people, who asked not to be identified when discussing private trans

EU Nears Price Cap Agreement On Russian Seaborne Oil U.S. Deputy Treasury Secretary Wally Adeyemo said he was encouraged by the news about the tentative agreement on the price cap -- an idea supported by the United States and the other Group of Seven (G7) leading industrialized nations -- adding that he expects the European Union to iron out details and reach a final agreement. EU countries have wrangled for days over the details of the price cap. Poland, which had pushed for the cap to be as low as possible, had as of late on December 1 not confirmed its support for the deal, Reuters and AFP reported. The initial G7 proposal last week was for a cap of $65-$70 per barrel with no adjustment mechanism. Poland, Lithuania, and Estonia rejected that level because Russian Urals crude, the main v

Commodity prices from copper to wheat are collapsing - and that could flip global inflation into deflation, says SocGenGlobal inflation is likely to swing to deflation in the next six months, Societe Generale said this week. The bank said such a development would follow what's been a fast collapse in commodity prices. Agricultural prices have been part of a rout that's also seen copper and oil prices yanked lower. From oil to metals to wheat, prices for natural resources have slumped from this year's highs and the fast deceleration will likely lead what's been a hot inflationary environment into a deflationary period in the coming months. That's the view from Societe Generale's co-head of global strategy Albert Edwards who in a note published Thursday looked at the "stunning collapse" in t

Gold is 'undervalued' and could see 'aggressive move to the upside,' despite Fed rate hikes - Luke Alexander (Kitco News) - Fed rate hikes have put downward pressure on the gold price, but gold will eventually break out aggressively, said Luke Alexander, CEO and President of Newcore Gold (TSX-V: NCAU), a Vancouver-based gold miner. Gold's price fell by 8.6 percent over the year, despite U.S. inflation peaking at 9.1 percent in June. Alexander mentioned that as the Fed raises rates, the U.S. dollar would continue to perform well, which will be an "overhang on the gold price." He added that when "expectations start to change, I think that's when we'll start to see gold perform… It could be a very aggressive move to the upside." "[Gold] is undervalued in terms of the momentum that I see in th

China Considers Relaxing Ban On Imports Of Australian Coal China is considering a partial easing of its more than two-year ban on imports of coal from Australia amid signs of improving bilateral relations, sources with knowledge of the matter told Bloomberg on Wednesday. China’s National Development and Reform Commission discussed this week the idea to allow four large Chinese coal importers to make new purchases of Australian coal this year, Bloomberg’s sources said, noting that such imports could resume as early as April this year. The four importers that could potentially be allowed to buy Australian coal are China Baowu Steel Group Corp, China Datang Corporation, China Huaneng Group Co, and China Energy Investment Corporation, according to Bloomberg. China enacted an unofficial ban o

Elon Musk Nods As Cathie Wood Raises Alarm On Trillion-Dollar Auto Debt Market Facing 'Serious Losses' ZINGER KEY POINTS The prices of used cars are likely to fall due to a shift in consumer preference toward EVs, said Cathie Wood. Manheim Used Vehicle Value Index showed that wholesale used-vehicle prices had fallen 3% in September from August. Cathie Wood, the founder of ARK Investment Management, is skeptical about the auto debt market, explaining how a fall in the residual value of gas-powered autos could lead to serious losses. What Happened: Wood tweeted, “Given the accelerated consumer preference shift toward electric vehicles, used car prices and the residual value of all gas-powered autos are likely to plummet, causing serious losses in the $1 trillion auto debt market." Given the

Rich Dad Poor Dad's Robert Kiyosaki Changes His Mind About Treasury Bonds — Says 'Time to Open My Closed Mind'The famous author of the best-selling book Rich Dad Poor Dad, Robert Kiyosaki, says it’s time to open his closed mind after listening to economist Harry Dent. He is now buying 2-year U.S. Treasury bonds despite repeatedly saying he does not invest in anything printed by the Federal Reserve or Wall Street.Robert Kiyosaki Influenced by Harry Dent, Buys Treasury BondsThe author of Rich Dad Poor Dad, Robert Kiyosaki, is opening his “closed mind” and buying 2-year U.S. Treasury bonds after listening to economic forecaster Harry Dent.Rich Dad Poor Dad is a 1997 book co-authored by Kiyosaki and Sharon Lechter. It has been on the New York Times Best Seller List for over six years. More tha

From inflation to recession: US retailers keep faith in the consumerWall Street is busy fretting over how far the US Federal Reserve will go to rein in inflation to its 2 percent target. A recession looks imminent and the latest comments by Fed chief Jerome Powell at an annual meeting of central bankers in Jackson Hole, Wyoming, leave little to the imagination when it comes to the central bank’s inflation fight.Rate hikes won’t slow even if the US economy does not slip into a recession. A recession coupled with inflation is deadly for corporate earnings and that is driving investors away from stocks.But if we parse through the management commentary by US companies that have declared their results so far, the outlook isn’t so bleak. Some companies are in sync with the market in their worrie

JPMorgan Sees ‘Stratospheric’ $380 Oil on Worst-Case Russian CutGlobal oil prices could reach a “stratospheric” $380 a barrel if US and European penalties prompt Russia to inflict retaliatory crude-output cuts, JPMorgan Chase & Co. analysts warned.The Group of Seven nations are hammering out a complicated mechanism to cap the price fetched by Russian oil in a bid to tighten the screws on Vladimir Putin’s war machine in Ukraine. But given Moscow’s robust fiscal position, the nation can afford to slash daily crude production by 5 million barrels without excessively damaging the economy, JPMorgan analysts including Natasha Kaneva wrote in a note to clients.For much of the rest of the world, however, the results could be disastrous. A 3 million-barrel cut to daily supplies would push bench

Nvidia Is on Sale and Cathie Wood Is a Big Buyer (Bloomberg) -- A rebound for Cathie Wood’s exchange-traded funds may depend in part on an equally battered large-cap technology stock that’s been a long-time favorite of hers -- Nvidia Corp ETFs controlled by the growth stock proponent’s ARK Investment Management LLC have been loading up on Nvidia shares, purchasing more than 400,000 in September, according to the firm’s daily trading disclosures. ARK funds held more than 675,000 shares as of June 30, according to data compiled by Bloomberg. Nvidia shares have plunged 55% this year, the biggest drop among tech stocks with market values of $100 billion or more. Sales growth has slowed at a time when valuations for rapidly expanding companies have come under intense pressure amid soaring inter

Expect a big rally in stocks after the war is over and a bigger rally in commodities in next few years: Jim Rogers"I am not worried about seven rate hikes not for a while because now the central bankers are scared because of the war and that is one reason that I suspect we are going to have a big rally before too much longer," says Jim Rogers, Investor and Author, Street Smarts: Adventures on the Road and in the Markets.Jim Rogers commentedI have been saying we should buy commodities for the last few months and even longer because we had seen a lot of money printing. Whenever there is money printing, prices go higher and especially if there is a war. Crude is on the boil, rising to levels we have not seen since 2008. It, of course, impacts India a lot. We are one of the largest energy cons

Will the banks trigger a stock market crash, again? This century is still young, but it’s already brought three stock market crashes. Isn’t that scary? It was the dot com bubble first, which burst and sent shares crashing. We were hardly back on our feet, when the big bank crunch sent shares down again. Then after a calm 10 years or so, the Covid virus hit. Now there’s talk of a new crash, and the banks are in the firing line again. But will it happen? The last bank crash was led by the US. This time, it’s also the US leading the way. S&P 500 down The S&P 500 perked up a bit in the past week. But it’s still down 17% from its early 2022 high, in a bit over a year. I don’t think that on its own is anything to panic about. But comparison with the FTSE 100 since the year 2000 is intere

79% of Warren Buffett's $338 Billion Portfolio Is Invested in Just 6 Stocks Warren Buffett has vastly outperformed the S&P 500 since becoming Berkshire Hathaway CEO in 1965. Because of Buffett's success, investors closely monitor Berkshire's quarterly 13F filings. Despite owning stakes in 49 securities, 79% of the Oracle of Omaha's investment portfolio is tied up in only a half-dozen stocks. The Oracle of Omaha tends to bet big on the companies he believes in. Few, if any, investors have a larger following than Berkshire Hathaway (BRK.A 0.35%) (BRK.B 0.17%) CEO Warren Buffett. That's because the Oracle of Omaha, as he's now known, has vastly outperformed the benchmark S&P 500 since he became CEO in 1965. Through the end of 2021, Berkshire Hathaway's Class A shares (BRK.A) delivered

3 Hydrogen Stocks to Buy for the $11 Trillion Breakout Technological advancements and falling renewable energy costs have led to a new era of scalable “Green Hydrogen” production. Thanks to its unmatched energy density, hydrogen outplays battery electricity when it comes to range, recharging times and emissions. Hypergrowth investors should take a good hard look at these emerging hydrogen stocks. Today, electric vehicles are all the rage. They’re at the epicenter of the world’s shift to cut carbon emissions dramatically and rapidly for a cleaner future. But EVs weren’t always at the forefront of the Clean Energy Revolution. Indeed, back in 2003, it was all about hydrogen. In his 2003 State of the Union address, then-President George W. Bush said, “the first car driven by a child born today

JPMorgan model says stocks in free fall mean recession is a lock The US stock market is sending a crystal clear signal on its view of the economy — a recession is all but imminent. That’s the verdict from a trading model created by JPMorgan Chase & Co strategists. It’s now saying the S&P 500’s 6.5% rout since the Federal Reserve turned extremely hawkish last week implies a 92% probability of US recession, up from 51% in August. Other assets are also flashing a similar warning. Pricing of base metals now carries a recession probability of 96%, up from 84% in August. The sharp repricing in everything from stocks to Treasuries and the dollar shows markets finally accepting clarion signals from a parade of Fed officials that they are willing to accept an economic slump as the price fo