Welcome to this week’s Market Wrap Podcast, I’m Mike Gleason.
Coming up we’ll hear from the one and only Gerald Celente of the Trends Journal and TrendsResearch.com. Gerald goes off on the Fed and the presidential reality show as he calls it in a highly entertaining interview and also gives us a look into how gold and silver will do after the election. You’ll definitely want to stick around for my conversation with Gerald Celente, coming up after this week’s market update.
Well, we suggested there was the potential for volatility in markets to escalate this week, and that’s exactly what’s happening. As the stock market sold off, precious metals prices surged ahead of the Federal Open Market Committee’s policy announcement.
As of this Friday recording, gold prices are up 2.1% for the week to trade at $1,303 an ounce. Silver shows a weekly advance of 3.6% to bring spot prices to $18.46. Also on the move is platinum, gaining 2.3% since last Friday’s close to trade at $1,006 per ounce. Palladium, meanwhile, little changed thru Thursday is rallying a bit today and now comes in $634, now showing a 1.8% weekly gain.
On Wednesday, the Fed left interest rates unchanged as expected. The official statement contained no major surprises and few linguistic deviations from the previous one. Policymakers made the case for an improving economy and a future rate hike. The reaction in the markets was largely subdued.
Financial Times Report
John Authers: I can't remember an FOMC meeting ever causing such little interest. This is where the market puts the chances that rates stay unchanged for the whole year, i.e. that we don't get a rate raise next month. It seems there's about an 80% shot that we do. The big risk that we don't (get a rate increase in December) comes across from the risk that Donald Trump is elected president next week, which is a growing risk.
The consensus on Wall Street is that Janet Yellen and company will finally hike rates in December. But that doesn’t necessarily mean they will. Fed officials still say they are data dependent. What’s unsaid is that they are also stock market dependent. The sell-off in stocks this week can be attributed largely to jitters over the election. Market gyrations could continue depending on how the results come in.
Yes, in case you haven’t heard, there is an election next Tuesday. And in recent days, the polls have narrowed dramatically. Just a couple weeks ago, it appeared a Hillary Clinton victory was all but inevitable. Some in the media declared the election to be effectively over. Now those same smug partisans masquerading as reporters are having to process new polling data showing Donald Trump in a dead heat with Hillary Clinton nationally.
The dramatic turnaround for the Trump campaign comes as a slew of scandalous and potentially incriminating revelations hit Team Hillary. Reams of classified information winding up on Anthony Weiner’s computer; attempted cover ups inside the Justice Department; revolt within the FBI; pay for play scandals in The Clinton Foundation; collusion between top DNC officials and establishment media outlets; and rigging the debates. Yes, the hits just keep on coming.
Despite her scandals and personal unpopularity, Hillary Clinton still has a structural advantage on the electoral map. All she needs to do is hang on to the “solid Democrat” and “lean Democrat” states. Trump, on the other hand, has to win all the Republican states, plus win Ohio, Florida, and all the other swing states, plus find a way to flip one of the Democrat-leaning states such as Virginia, Pennsylvania, or New Hampshire.
It’s a tall order. But if the national momentum surge Trump has enjoyed over the past week carries over into next Tuesday, then we could see some normally blue parts of the country light up red.
A Trump win figures to be bad for the stock market, bad for the dollar, and good for precious metals – at least in the near term. Over time, investors may come to like Trump’s tax cuts. But for now they don’t like the uncertainty a potential Trump presidency would bring.
Unfortunately for the stock market, uncertainties may persist even if Hillary Clinton emerges victorious. Will she face indictment or impeachment? Will she even be sworn in as president or will she heed calls to step down and hand over the presidency to Tim Kaine?
Will social unrest spread if the election results are contested? Needless to say, whoever is finally sworn in come January will have to preside over a very divided country. Moreover, the next president will have to preside over a $20 trillion national debt with projections for rising deficits in the years ahead.
Eventually, the cold hard reality will set in that regardless of who occupies the Oval Office, and regardless of which party controls the Senate, meaningful fiscal reforms will be politically impossible. For investors, it’s not a question of whether the deficit spending will continue, but what the consequences of it will be. One big consequence is likely to be a weakened and globally discredited dollar.
Well now, without further delay, let’s get right to this week’s exclusive interview.
Mike Gleason: It is my privilege now to be joined by Gerald Celente, publisher of the renowned Trends Journal. Mr. Celente is a highly sought after guest on news programs throughout the world and has been forecasting some of the biggest and most important trends before they happen, for more than 30 years now. And it's always a real honor to have him on with us. Mr. Celente, welcome back and thank you very much for joining us again.
Gerald Celente: Well thank you Mike.
Mike Gleason: The fed just kicked the can down the road here again on rate hikes, opting against any increase at this week’s meeting. Market's still think they will inch up rates in December. Is this just more bluster or do you think they will actually tighten anytime soon?
Gerald Celente: You know the Fed should called out for the frauds that they are. Let's call a spade a spade. These low life central banksters, who raised interest rates for the first time in nearly 10 years last December, just about a year ago, 11 months ago, had said that they were going to raise rates 4 times in 2016. One little low life shill, FOMC, how about an FUC? I don't want to use the last letter, because then I would sound as though I was being disrespectful to these low-life little SOB's. And what they did, keep shooting their lying mouths off for almost a year saying they were going to raise rates, raise rates four times after they raised them last December. And all they keep doing is keep saying that to push down the price of gold. Because their failure, as evidenced by the tepid economic growth, not only in the United States, but all the central banks. Whether it's negative interest rates coming out of Japan and the EU. Whether it's near zero interest rate policy in the United States. It has done nothing, nothing to increase global growth for the majority of the people.
Those aren't empty words, for example here in the USSA we've seen 95% of the wealth go to the 1% since 2009. Those are facts. So these little Fed flunkies are doing nothing more than shooting their mouth off in an attempt to drive down gold prices, because what gold shows is that these fiat currencies backed by nothing, these digital currencies backed by nothing, and printed on nothing are worth nothing. So now the Fed, maybe they'll raise interest rates in December. Big deal. It will be the second time. What are they going to raise, 25 basis points? And that will be the second time in what? Over 11 years? This is a war against the savers. It's a war against we the little people used to put money in safe deposits, and we used to a get a return on the investment, a term called, "interest rates." And now there are none.
What they're doing only is to keep the phony equity markets alive. Do you need any more proof Mike? Then look back at last month. Oh it's only October a couple of days ago, what do we see? 500 billion dollars in merger and acquisition activity, thanks to cheap money that the Feds give their friends. And stimulus programs of government buy backs, whether it's in Europe, or Japan, and corporate bonds. So not only government bonds, but corporate bonds. The whole thing is a sham. The Federal Reserve is a disgrace. You look at their track record, one failure after another. But you know what they have a lot of? Is bad attitude. And the little presstitutes suck up and buy it, and the politicians bow down and take it, and they shove it onto us, and we're the ones who pay for it.
Mike Gleason: We're just a few short days away from learning the outcome of one of, if not the most anticipated elections in history. It certainly gets crazier by the day. A week ago the bombshell story about the FBI reopening the case on Hillary Clinton's email abuses, where state secrets may have ended up on cyber stalker Anthony Wiener's laptop. Trump was trailing leading up to that, but now it looks like he may actually pull this thing out with just a few days to go here. So what are you expecting to happen next Tuesday Gerald?
Gerald Celente: It's anybody's guess. We've been saying this…first we called Trump the winner, we called Hillary Clinton a winner before Trump got in. Then we've been calling Trump a winner for the better part of a year. We said that the only thing that could destroy Trump's chances was himself. And he's done a pretty good job of that as well. Right now it's just up in the air because each day there's new data coming out, information from WikiLeaks. And as you pointed out, last Friday the FBI said they're going to look deeper into her private email servers that she used when she was Secretary of State. And that's taken a big hit on her, and you can see it in the poll numbers. So this thing is really up for grabs.
And what's really important about this Michael is that we're just looking at WikiLeaks going into one person's email, Podesta, one. Could you imagine if they looked into the many emails of the people in politics, and in government that are lying to us in front of our faces and doing dirty deals behind our backs? Again, this is only one. So there’s a lot more to come out here, and then you're seeing the new WikiLeaks (info) showing how the Clinton campaign was getting inside information from the Department of Justice. What justice? Just us, they're spelling it wrong. It's J-U-S-T U-S. It's one piece of information after another that's showing how the government is controlled by so few, and the elites really do run the game.
And by the way, that's the popularity that's going toward Trump. It's the anti-elitist movement, and of course he's a pop-populist as we see it. He's not the real deal compared to what's going on in Europe with the alternative for Deutschland, the AFD Party. The Freedom Party in Austria. La Pen's Party in France. So he's playing into that discontent, but again this thing is just up in the air, and we don't think it's going to be decided until election eve. And it will be a close vote, and it's anybody's guess.
Mike Gleason: That leads me right into my next question with Trump there. He has been given a fair amount of credit as a political outsider, and someone who can bring reforms to Washington. On the one hand we can see the establishment fighting him, and it does not appear he is beholden to the usual roster of undesirables for raising money. He's already wealthy. We give him points for that, but on the other hand, a lot of what he's promising sounds pretty status quo. He wants to strengthen Social Security and entitlement, spend more on the military, borrow and spend a fortune on infrastructure. He hasn't talked much about addressing the Federal Reserve debt deficits, the issues that are driving the American empire toward collapse Gerald.
Gerald Celente: No, none of them have. Again, look at these stupid debates. They're not debates, they're game shows. It's the presidential reality show. "Here you go Mike, you have 2 minutes to answer a question on what your foreign policy is with domestic policy on the economy." What imbecile would answer a question like that in 2 minutes? If somebody said that to me I'd say, "Screw off, who are you talking to? This takes more than 2 minutes to go through." And that's what they've done. So you haven't had any real discussion, deep discussion about policies, it's only sound-bytes. And as you pointed out, Trump wants to build the military even bigger. On military we spend more than the next 10 countries combined. Bigger? For what? And as you point out about Social Security, and as his economic policy with tax breaks, they're going to help the 1% more than anybody else. Again, there are no real policies, but again his popularity is because he's also coming out against NAFTA, and the trade deals.
And today, in the current times, we still have Obama promising to push through the Trans-Pacific Partnership as soon as the elections are over. So that's his popularity. There's really no policies. There's no policies about making America a self-sustaining economy, which is one of our top 10 trends for 2016. You're seeing that happening, by the way, in China. China is importing less and less, making more and more, and selling it to their own people rather than even exporting it. That's the future. But Trump again isn't talking about that, and Clinton, we heard her… she's in favor of more open borders, and more globalization. So we know what the stand is. Whoever wins, we feel the American people will ultimately lose.
Mike Gleason: Gerald we've been seeing the markets behaving as if a Trump victory is bad news. As Trump has surged in the polls, stocks have been selling off a bit, and precious metals have been catching a bit. What is your take as to what the election might mean for the markets?
Gerald Celente: Short term if anything, it's just a short term hit. Just go back to Brexit, look what happened. Look at the panic in the markets before and after Brexit, the volatility index. And then after Brexit was over, a couple of months later the Dow hit new highs. So it will only have a temporary effect on the markets, as we see it. Unless something very radical happens, and of course we do believe, however, that if Trump wins it will be bullish for gold, and you could already see the gold spikes that have happened since Hillary Clinton has been declining more in the polls, and Trump's popularity has been rising. That's significant to watch, because one of the things that Trump does come out and say is what a fraud the Federal Reserve is, and how a giant bubble is being inflated. And it's not only the bubble in the United States, it's the real estate and equity bubbles in many parts of the world. Particularly China, there's bubble after bubble in industry after industry, and sector after sector.
So that's where he's really dead on, on calling it out what it is. Again, this is old news to us. In our Trends Journal, back in 2010 we said the Federal Reserve’s actions weren't going to bring a recovery, it was just a cover up. And the cover up has been very simple. Again, record merger and acquisition activities that has further instilled the multinational globalization trend, which means it hurts entrepreneurs. And the second one of course is stock buy backs with the cheap money that has boosted equity markets. But look, the last spots 6 quarters, the Fortune 500 companies reported loss of profits, negative profits in 6 quarters. You can see what's going on.
Then take a look at the global situation. Was global trade down the first half of the year, nearly 1%? Take a look at the big shipping companies, the troubles that they're in. Take a look at the United States. In the first 9 months of this year, our import and export trade is down nearly 500 billion dollars. You want to talk about globalization? How about saying it's not working and there's a global slow down.
So when you put all the pieces together and look at a global-nomic viewpoint, there's a global recession underway. And now there's also general recognition that the central banks policies have failed to generate economic growth, and no other better one to look at by the way is then Abe-nomics in Japan. Despite unprecedented negative interest rates and stimulus programs going on for nearly 4 years, the only thing they have to show for it are recessions and negative income, and negative spending.
The same thing in the EU, we're looking at what? Growth for the last half of the year at 1.4% despite negative interest rates, and 80 billion euros a month of quantitative easing, and corporate, and government bond buy backs. So there's no recovery.
Mike Gleason: If we do see a economic slowdown or maybe even a crisis like we saw back in 2008, what do you think precious metals, what do you think will happen to precious metals? Obviously they got taken down a little bit with all the financial assets there in 2007, 2008. Do you think we see a repeat of that, or will gold and silver act as true safe havens, and potentially go in the other direction?
Gerald Celente: We see gold and silver as the ultimate safe haven, there's no question about it in our mind. Again, the only thing that they're doing is talking down gold by saying that the dollar is going to increase in value, which means of course gold is based on dollar value. The stronger the dollar gets, if people are feeling they’re getting higher interest rate returns on a dollar they’d rather hold dollars rather than gold. But the dollar in all of the currencies are going to be under severe pressure in an economic down turn. And what it will mean is that central banks will come up with more schemes. By the way, the new scheme that they're all talking about now – that (point to the fact that) the central banks have failed – is government stimulus. By the way, that's what they're doing in China. Do you know what, China's debt to GDP ratio is going to be hitting 260% this year? 260%. It's a whole sham. It’s one big bubble.
So yes – and we don't give financial advice, we're trend forecasters, but only speaking for myself, I'm very bullish on it. Well, we're bullish on gold in terms of our forecast. Again, all you have are cheap digital currencies backed by nothing, and printed on nothing. So why would you want to own those? Again, look at what's going on around the world. Whether it's Venezuela with their what? Nearly 600% inflation rate. Look at the problems in Argentina, despite the new government (leader, President) Macri. People are protesting already, inflation's skyrocketing. Take a trip to Brazil, what are you looking at? You're looking at the worst recession in 100 years. And then you look at all these oil rich countries that are suffering, and resource rich countries.
So this is only going to prove more painful. If in fact they raise interest rates, the dollar becomes more valuable and all these countries, particularly their emerging markets have to pay off their debt in dollars as their currencies decline. By the way, that's one of the big fears the Fed has. They talk about it very infrequently, but that's really the big issue. It's the global debt bubble. So if the dollar becomes more valuable, and these emerging markets and corporations that have borrowed so much have to pay it back with more expensive dollars as their economies declining, you have a crisis of proportions we've never seen before in the history of the world.
Mike Gleason: Yeah, certainly seems like an untenable situation there, and obviously a stronger dollar is going to hurt all that like that you mentioned. Now as we begin to wrap up here, this has been a very contentious campaign season, probably more divisive than we've ever seen in this country. Now you've always been on the leading edge of predicting political and social unrest, what are your thoughts on the potential fallout in the months following this election here Gerald.
Gerald Celente: Well first of all one of our top trends I can tell you (about) – and we're going to have a conference here in December, in Colonial Kingston New York, we own three of the buildings on the most historic four corners – one of the trends we're looking at is a great populous movement. This is basically the end of the Republican party. There's nobody there, that's why Trump was able to win. Look at the people, you got a little bunch of nobody’s going no place. Whether it's McCain, Jed Bush, Paul Ryan, there's nothing, it's empty. Lindsay Graham, McConnell, all running on zero. You're going to see the end of the conservative movement, and a big push towards populism. I'm saying that also because should Hillary Clinton win, there will be a huge populous movement that will be very, very much anti-Clinton, and anti-Democratic party. And there's going to be a very long period of socio-economic and political unrest in the United States following this election, particularly if Clinton wins.
And as Trump said, and again, I'm not voting for either of them, neither of them represent my values. I want to make that very clear, they do not represent my values, I don't vote for the lesser of two evils. So having said that, Trump is particularly on trend when he says that considering the FBI actions being taken against Clinton, if she wins, that administration is going to be under a lot of legal turmoil for quite a long time. So it will be a very divisive campaign. On the other hand, if Trump wins the Democrats and the liberals, they're not much of fighters. They fold really quickly. For example, you have liberals that pretend to be pro peace, you know, quiche eating liberals. They talk out of both sides of their mouth. So they claim to be peaceniks and peace loving, and here they're voting in a woman with more blood on her hands than just about anybody out there that's running for office.
I say that cause she was responsible for the overthrow of Gaddafi in Libya, and anybody could go to Google, put in, "Hillary Clinton, CBS News, Gaddafi," and you can hear her say when she was asked by the CBS News reporter, "How did you feel when you found out Muammar Gaddafi was killed?" And not only was he killed, he was sodomized with a sword on video, and cut up to pieces, and just killed in just a grotesque manner. She straightens up and she said, "We came, we saw, he died. Hee-hee, hee-hee" They should have taken her out of there in a strait jacket. And then you look at what Gaddafi has to go, Assad has to go, she wants a no fly zone in Syria.
So the liberals are hypocrites. Because they claim on one hand that they love peace and love, and they are voting for a woman who has more blood on her hands than almost equivalent to her husband, who of course was bombing Iraq on a daily basis, four times a week basically when he was president. Put on sanctions on Iraq, they killed over 500,000 people. Again, you could go to YouTube, Madelyn Albright, Leslie Stall, when they ask secretary Albright who was Secretary of State under Clinton how she felt was the price of the 500,000 young kids under 5 years old, worth the price of the sanctions. That was according to a UN number, and she said, "Yes it was." Of course Bill Clinton's Yugoslav war. Hillary Clinton's pro Afghan and pro Iraq war. They're war criminals. Nothing more, nothing less.
So what I'm saying is that you will not get it back because they're such cowards on the liberal end, they won't fight a Trump presidency. They'll fold. They're not fighters. On the other hand if Clinton wins you're going to see a lot more outrage about her being in office, considering the amount of WikiLeaks coming out that are adding great questions to the legitimacy of her campaign, and the ethics of the Clinton Foundation. That's not going to go away.
Mike Gleason: Well we'll leave it there Mr. Celente. Thank you so much for joining us again, we always love having you on. And I appreciate your candid insights as usual. Now before we let you go, as we always ask you to do, please let folks know more about how they can get their hands on the tremendous information you put out, both online and with the Trends Journal Magazine, as well as anything else that's going on there at the Trends Research Institute.
Gerald Celente: They could go to TrendsResearch.com and they could subscribe to the Trends Journal. Of course we do a Trends in the News Broadcast each weekday night, a Trend Alert each week, a Trends Monthly. We have conferences, we have one coming up here in December 2nd on the top trends of 2017. Also, for people that can't afford it, there's a discount request page. It's only $99 anyway. But if you can't afford it, we know people are having difficult times, we try to make it available to everyone. It's the only place we believe you're going to find history before it happens. That's not an empty slogan. Look what's going on in the media just as we speak. Reuter's announced a 4% cutback of their staff. New York Time's, major layoffs. Wall Street Journal, major layoffs. Gannett News Service, major layoffs. You're not getting news anymore, you're getting sound-bytes, you're getting Facebooked, you're getting tweeted, and you're getting Google Newsed.
If you want real news to prepare for the future, avoid the dangers and benefit from the opportunities. I truly suggest you consider the Trends Journal.
Mike Gleason: Certainly a strong advocate for it here. We get a copy of the Trends Journal Magazine in the office here every month. It's truly fantastic stuff, and definitely urge people to check that out. You will not be disappointed, it really is fantastic information and very well put together as well I might add.
Well excellent stuff, I hope we can catch up with you again real soon as we sift through the post-election fall out. I hope you have a great weekend, and thanks for being so generous with your time Mr. Celente.
Gerald Celente: Thank you so much for having me on, and thank you for all that you do.
Mike Gleason: Well that will do it for this week. Our sincere thanks to Gerald Celente, publisher of the renowned Trends Journal. For more information the website again is TrendsResearch.com. Be sure to check that out.
About the Author:
Mike Gleason is a Director with Money Metals Exchange, a precious metals dealer recently named "Best in the USA" by an independent global ratings group. Gleason is a hard money advocate and a strong proponent of personal liberty, limited government and the Austrian School of Economics. A graduate of the University of Florida, Gleason has extensive experience in management, sales and logistics as well as precious metals investing. He also puts his longtime broadcasting background to good use, hosting a weekly precious metals podcast since 2011, a program listened to by tens of thousands each week.