Looks Like It's Time for Fed to Talk Up Another Rate Hike!

U.S. 10-Year Treasury yield is fading fast as money flees Europe. Looks like it's time for a Fed governor to draw the short straw and go out and talk about how multiple rate hikes are imminent.


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Update: Alert the Confusion Brigade. From Marketwatch: 

Philadelphia Fed President Patrick Harker said he backs a December rate increase if the economy continues to grow as expected, while Atlanta Fed President Dennis Lockhart said he expects the Fed to be in a position to raise rates soon.

Fed Gov. Jerome Powell, on the other hand, said the Fed can afford to be patient in gradually raising rates as the economy slowly improves.

Mexican Peso Says Trump Is Gonna Win

Sure seems that way.





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Weekly Gold -- Time for a Bounce?

The Fed has entered a "quiet period" before its next meeting, and gold seems to be going along for the ride. Here's an updated chart. 


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If this channel holds true, gold is primed for a bounce. Potentially a big one.

Other stories of interest ...

ETFs backed by gold account for just 3% of the $3.21 trillion of assets held by investors.

The Fed is in a quiet period, but their agents can still massage the market. Wall Street Journal's Hilsentrath: Divided Federal Reserve is inclined to stand pat http://on.wsj.com/2cRYKiy


Still, we should notice that bond rates are rising. If this correction to the big declining trend turns into a real rally (a big "if"), as gold investors, we have to be honest with ourselves. That could smack gold on the nose, at least temporarily.

China is in a new home-buying boom. Potentially good for commodities.

On the other hand, IEA cuts global oil demand forecast amid ‘wobbling’ Asian demand: http://on.wsj.com/2cSEXQ2 

Oil Bankruptcies Leave Lenders With ‘Catastrophic’ Recovery Rate, according to Moody's. 21% Recovery rate. Ouch.

Wars in Iraq, Afghanistan cost almost $5 trillion ... so far. Man, what could we do with $5 Trillion?  

Gold Channels Down ... Gold Channels Up

Check out this chart from StockCharts.com for GLD




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Why Fischer Contradicted Yellen; Said We'll Have 2 Rate Hikes

Janet Yellen spoke on Friday. She didn't hint at a rate hike in September, gold and the markets soared.

Three hours later, Fed Vice Chair Stanley Fischer came out to say "What Chair Yellen really meant was ..." and completely contracted her.

I don't think it's about gold. I think it's about Treasury yields.



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By the way, Fischer has a history of being full of baloney. The market doesn't remember, but last August he hinted strongly at a September rate hike and it never happened.

Where various Fed governors stand on rate hikes: LINK

Brad DeLong on what Fischer should have said. LINK

Chart of the Day: Gold ETFS

I thew in a materials stock ETF per a request.





Have a great day.

Chart of the Big Squee-ee-eeze in Treasuries ($TLT)

On StockCharts.com Arthur Hill offers a great chart of Treasury prices and yield. 


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And here is the link to Arthur Hill's original story, with a lot more charts