The Mess That Greenspan Made - Part 18

Gold and silver prices continue to be range-bound, for gold around $1,300 an ounce and for silver between $19 and $20 an ounce, but with the recent break-out for another safe-haven in Treasuries last week, it’s possible the metals will soon break free of their recent trading ranges as well. Unfortunately for gold bulls, a move to the upside has been made more difficult by the U.S. dollar that is again strengthening, and this appears set to continue amid talk of monetary easing by the European Central Bank that could lead to a weaker euro.

Gold and SilverThe situation in the Ukraine is not improving, but gold traders seem to be getting bored with this story again despite escalating violence and there being no peaceful resolution in sight. Instead, traders pored over a bevy of U.S. economic data last week but, despite clear signs of accelerating inflation in the U.S., this generated little buying interest for gold and silver.

China gold demand has been steady, and U.S. hedge funds made few changes to their gold holdings in the first quarter. Investment banks remain mostly negative about the prospects for precious metals, though less negative than they’ve been over the last six months, as this market seems to be “stuck in neutral” heading into the traditionally slow summer months. The recent elections in India could liven things up if, as expected, the new government relaxes the draconian gold import curbs that have stifled demand there for more than a year.

Precious metals remain stuck in narrow ranges…

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Fed Up

The new documentary Fed Up came to my attention over the weekend, due in part to the appearance of Dr. Robert Lustig, Professor of Pediatric Endocrinology at UC San Francisco, on Friday’s Real Time with Bill Maher.

The movie adds to the discussion about nutritional guidelines and sugar in American diets that, someday, might become significant enough to lead to important change in what we eat as diet is increasingly blamed for out-of-control obesity rates and related problems.

As someone who was on track for “gain a pound a year each year you’re over 30″ up until about five years ago, I can sympathize with one of the first comments in the clip:

The message that’s been pushed on us is “it’s your fault you’re fat”

There are 600,00 food items in America. Eighty percent of them have added sugar. Your brain lights up on sugar just like it does on cocaine or heroin.

When combined with a corporate culture where profits are more important than health along with regulatory capture in government akin to what we see in just about any other big industry and you end up with one of the greatest public health epidemics in human history.

Monday Morning Links

ECB Plans Negative Rate on Bank Deposits – Spiegel
Draghi Isn’t Doubted as ECB Stimulus Awaits – Bloomberg
Concerns grow as real estate cool-down continues – China Daily
Putin orders troops near Ukraine border to return home – AP
China ships reportedly evacuate almost 2,000 from Vietnam – CNA
China, Russia, and Iran have friendly get-together to sort out security in Asia – Quartz
No job and no money? Here’s why it’s the perfect time to move out – Financial Post
Looking for a last minute graduation present? How about crushing debt? – Housing Wire
Smoking gun from the Fed murder of the middle class – The Burning Platform
The Case Against the Bernanke-Obama Financial Rescue – NY Times
High Ho! Disneyland hikes ticket prices by up to 10% – USA Today
The Journeys of Sisyphus – Hussman Funds
Nervous Time – Noland, Prudent Bear

Global stocks lower after weak China housing data – AP
The Many Reasons for the Bond Rally – The Reformed Broker
Stocks are telling you a bear market is coming – MarketWatch
Wall of Worry Rebuilt as Nasdaq Rout Sends Cash to High – Bloomberg
Russell 2000 nosedive means it’s time to take stock of investments – Telegraph
U.S. Yields Approach Six-Month Low Before Fed Minutes – Bloomberg
Gold back over $1,300 as equities weaken – MarketWatch
European Central Banks to Coordinate Gold Transactions – WSJ
China Real Estate Debt Settled In Silver, SGE Premium 5.7 % – In Gold We Trust
Hedge Funds Cut Gold Bull Bets Most in Month – Bloomberg
Give gold ’some credit’ for resilience – Mineweb

The deflation bogeyman – Gresham’s Law
What Thomas Piketty Doesn’t Say – Bloomberg
4 reasons US is recovering…and leaving the world behind – CNBC
Swiss voters reject $25 minimum wage – CNN/Money
Greek Selloff Shows Rush for Exit Recalling Crisis – Bloomberg
China: Biggest Loser In India’s “Modislide” Election – Forbes
China Home-Price Growth Slowdown Spreads as Sellers Discount – Bloomberg
BOE’s Mark Carney highlights housing market’s risk to UK economy – Guardian
Two Housing Markets for the Two Americas – Fiscal Times
“Generation rent” raising demand for multifamily housing – Sober Look
Clueless Geithner: Never saw the meltdown coming – NY Post
Yellen: China’s Financial Woes Manageable – WSJ


Where Few People Drink, They Drink A Lot

Via this item at The Economist’s Daily Chart feature, there are some surprising details about how many people drink in various countries around the world and how much those people who do drink drink in what is yet another example of how seemingly mundane data can produce all sorts of fascinating cultural insights.

In short, where few people drink, those who do drink consume an extraordinary amount of alcohol, perhaps to help them deal with the fact that they are going against the cultural/religious grain in their country.

France leads the way with the highest share of drinkers at 95 percent, but their consumption is relatively low, in line with the rest of the West. To no one’s surprise, Russia and their satellite nations consume the most alcohol on a per capita basis. Lastly, the huge difference between Saudi Arabia and UAE is pretty interesting as they’re right next to each other.

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