Forbes: "Every Investor Must Own Gold"
Gold last traded at $1,282. Silver at $16.94 an ounce.
News Summary: Precious metal ended higher Wednesday as President Trump disbanded business advisory groups. U.S. stocks struggled after release of Fed minutes.
In The Age Of Cyber-Terrorism, Every Investor Must Own Gold - Forbes
"Take it from 'Dr. Doom': own some physical gold and keep it out of the banking system....In a recent Metal Masters interview with the Hard Assets Alliance, he noted that the biggest geopolitical risk for Americans today is not a conventional war but rather cyber-attacks that could take down the U.S. power grid. In such a scenario, gold would become an irreplaceable medium of exchange. But it's not the only reason to own gold today....The Fed largely ignores gold as an asset, he says, because 'gold is an embarrassment to central banks.' Regarding a possible war, Faber believes it's unlikely that anyone will ever invade China or the United States. He thinks the true vulnerability lies in 'wars that are fought not with tanks-they are fought by, say, somebody could switch off the light in New York, or the electricity, or the Internet. If you switched off the Internet, what would happen?' This is where the merits of gold bullion become obvious, he says: 'In these times, you actually want to have access to something physical that is a recognized medium of exchange.'"
China's debt boom could lead to financial crisis, IMF warns - The Telegraph
"China's economy is reliant on too much debt and the enormous boom in credit risks leading to a new financial crisis, the International Monetary Fund (IMF) has warned. GDP in the world's second largest economy is set to grow by 6.7pc this year and 6.4pc next year, better than the 6.6pc and 6.2pc growth rates that the IMF forecast earlier this year. Stronger global growth has given China a lift, as has extra government spending. But in the years ahead, risks will grow as China's extraordinary debt bubble keeps on building. Growth in China has been propped up by rapid increases in debt in recent years. 'Nominal credit to the nonfinancial sector more than doubled in the last five years, and the total domestic nonfinancial credit-to-GDP ratio increased by 60 percentage points to about 230pc in 2016,' the IMF found. Those debts are expected to rise to almost 300pc of GDP in 2022.... 'International experience suggests that China's current credit trajectory is dangerous with increasing risks of a disruptive adjustment and/or a marked growth slowdown,' the report said. Its analysts studied 43 large credit booms and found that almost every single one resulted in a sharp slowdown or a financial crisis."
Americans' debt level notches a news record high - Reuters
"Americans' debt level notched another record high in the second quarter, after having earlier in the year surpassed its pre-crisis peak, on the back of modest rises in mortgage, auto and credit card debt, where delinquencies jumped. Total U.S. household debt was $12.84 trillion in the three months to June, up $552 billion from a year ago, according to a Federal Reserve Bank of New York report published on Tuesday. The proportion of overall debt that was delinquent, at 4.8 percent, was on par with the previous quarter. However a red flag was raised over the transitions of credit card balances into delinquency, which the New York Fed said 'ticked up notably.' Loosening lending standards have allowed borrowers with lower credit scores to access credit cards, Andrew Haughwout, an in-house economist, said in the report. 'The current state of credit card delinquency flows can be an early indicator of future trends and we will closely monitor the degree to which this uptick is predictive of further consumer distress,' he said."
DALIO: Risks are rising, and everybody should put 5% to 10% of their assets in gold -BusinessInsider
"Geopolitical risks are rising, and everyone needs to consider an allocation to gold. That's according to a Bridgewater Associates note to clients released on Wednesday, penned by founder Ray Dalio and staffers Bob Elliott, Steven Kryger, and Neil Hannan. Bridgewater, based in Bridgeport, Connecticut, is the world's largest hedge fund firm, managing about $160 billion firmwide across strategies. 'When it comes to assessing political matters (especially global geopolitics like the North Korea matter), we are very humble. We know that we don't have a unique insight that we'd choose to bet on ... We can also say that if the above things go badly, it would seem that gold (more than other safe haven assets like the dollar, yen, and treasuries) would benefit, so if you don't have 5-10% of your assets in gold as a hedge, we'd suggest you relook at this. Don't let traditional biases, rather than an excellent analysis, stand in the way of you doing this (and if you do have an excellent analysis of why you shouldn't have such an allocation to gold, we'd appreciate you sharing it with us.)' Dalio has long been of the view that investors should have at least some allocation to gold, saying as much in an interview with Business Insider's Henry Blodget earlier this year."
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