International Forecaster Weekly

The imminent return of the federal government’s debt ceiling is causing agita among money-market traders once again.

Conventional wisdom holds that the risk that Uncle Sam might default by missing a payment on a bill or two is next to nothing.

Nevertheless, investors are wondering if and how the Treasury can slash its giant cash pile to the level the department has indicated would be consistent with its policies and the 2019 act that suspended the limit. 

And they’re concerned about the impact that any such moves could have on short-term funding markets, which underpin much of the global financial architecture.

Why would someone pay me for that type of information? Well, the NASDAQ was in a bubble like we’d never seen. And Companies took advantage of that bubble by splitting their stock, thus making it cheaper for more masses to enter, and the stock would zoom back up. But traders often saw that the minute a split was announced, it would start climbing higher. They wanted in quickly and cell phones weren’t that popular yet. Hence the pager.

If you want to know why prices at your local gas station are so much higher these days than before the pandemic, you only have to look at the number of oil rigs that are up and running off U.S. shores.

We know that the demand for oil has been rising as consumers emerge from Covid hibernation and businesses try to remake themselves to supply them. 

However, oil companies are dragging their feet on ramping up production, new data from Baker Hughes showed last week. And when production doesn't keep up with demand, it drives prices higher. 

So, this weekend we mentioned some of the ills facing us and they’re aplenty for sure. We know they’re coming at us with Central bank digital currency. We know the BIS, IMF, and regional central banks are all in on it and can’t wait.

We write mainly about economic factors in these letters. But in reality, one can never ignore all the other factors that make up economic reality. For instance Political decisions weigh on economic factors. Global partnerships, alliances, wars, trade embargo’s, sanctions, you name it. It all adds up to actually influence your money, your investing and your way of life.

Control. The elitists worship it. They get a form of sexual gratification from it. And boy does it show. From the censorship on social media, where the President of The United States was banned, to the lock downs, the masks, the no travel rules, the shutting down of businesses to you name it.

Yesterday, the U.S. Supreme Court took two steps backwards in the fight for fair and transparent elections — and in the process struck one more blow to our fragile and vulnerable representative democracy.

Friday’s article blog pointed out that in 2018, only 43% of companies in the S&P 500 Index incurred any expenses for research and development.

And just 38, or 7.6%, of companies accounted for 75% of the R&D spending of all 500 companies in the index.

So, I asked, where’s all the corporate cash been going?

Stock buybacks and dividend payments are on the verge of gushing out of Wall Street banks’ faucets and breaking through the proverbial dam. 

Just six months ago, participants in a monthly survey conducted by too-big-to-fail Deutsche Bank were asked, “[What] do you think are the biggest risks to global financial markets in 2021?”

What’s it all mean? Are we at an inflection point in market land now, and the big bull market is over? Probably not just yet. That said, Quad hangovers can indeed extend several days, as traders reposition and rethink their futures roll outs. But make no mistake, the Fed’s statements, along with Bullard’s opinion, has changed the narrative some. We might see a much more volatile next two weeks as they try and square up all of this. Caution is warranted.

Flying below the radar across the country, under the shadow of the better-known student loan crisis, colleges and universities have been having trouble paying their bills.

Axios’ Kate Marino believes there’s a reckoning coming in higher education — especially for smaller, private liberal arts schools — that’s been years in the making. 

Over in Russia they’ve asked all foreign migrant workers to return home by June 15th. Why would they do that? Russia has a labor shortage to begin with, so they use Asian’s to bolster the workforce. Why send them home?

The US has requested that Americans living in Russia should come home. When? By June 15th if possible. Why? Why kick out the migrant workers and why have US Citizens come back? Why will Visa’s to Russia not be given out any more?

But as time went on and I got older and maybe wiser by a brain cell or two, I started to see silver in a whole different light. By the time 2007 rolled around, and I had spent a few years “looking into this stuff,” my opinion swung 180 degrees. I still don’t much like it for jewelry, but that’s the mechanic side of me talking. When properly polished, it has its own form of warmth that I can indeed appreciate. It can look quite nice, as long as you keep the tarnish away.

The bottom line however, no matter what sort of investing/trading you wish to do, the most important thing is your risk management. I’ve been in this game for over 26 years. I’ve seen so many people “blow up” because when the market was hot, and they were making gains every day, that they thought they were geniuses. But, then the market decided to roll over into a bear market, or even just a good correction, and they got crushed, losing it all.  It’s all about risk.